The Need for Prompt and Relevant Corrective Action

Variance analysis attempts to identify discrepancy between actual and planned results.
Adverse/unfavourable variance should be investigated – determine cause i.e. inefficiency or external factor,
Inefficiency could be caused by lack of motivation or inappropriate training.  Steps should be taken to rectify issues.
External factors, such as a downturn in market, are harder to accommodate. May be necessary to amend targets accordingly.
Either cause should be dealt with promptly to avoid an increase in adverse variance.


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