What is variance analysis?

< 1 min read

Variance analysis compares actual performance against planned or expected targets.
In one project, we compared actual monthly revenue with budgeted revenue to identify gaps.
It helps quantify the difference as positive or negative variance.
We also analyzed variance by region and product to find root causes.
It supports management in understanding performance deviations.
Variance can be volume-based, price-based, or mix-based depending on the metric.
As a BA, I use it to explain why targets were missed or exceeded.
Overall, it drives corrective actions and better planning decisions.

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