Overview
Revenue missed budget by €200K this quarter. The finance team reports the miss. The CEO asks: "Why?" The team says "lower sales." But "lower sales" is three different problems: did we sell fewer units (volume variance)? Did we sell at lower prices (price variance)? Did we sell a different product mix (mix variance)? Each has a different cause and a different fix. Without decomposition, the response is "sell more" — which addresses none of the root causes.
Variance Analysis decomposes budget-to-actual differences into their component drivers — separating price, volume, mix, and timing effects across revenue and cost lines, so each variance is attributed to a specific cause with a specific responsible owner.
What you get: - Budget-to-actual comparison at summary and detail levels - Variance decomposition into price, volume, mix, and timing - Department-level variance attribution - Variance trend analysis (recurring vs. one-time) - Materiality thresholds and escalation rules - Root cause investigation framework
Built for: finance teams who report budget misses as single numbers — where decomposing the miss into its drivers changes the response from "sell more" to specific, addressable actions per driver.