Variance analysis and performance: two empirical studies

Description
When variances are investigated, a substantial amount of information can be generated which is often discarded
once managers have explained the variance to superiors. This paper argues that discarding such information is wasteful
for problem solving. Evidence from two empirical studies, a longitudinal ®eld study in a single organization and a cross
sectional study, is presented which provides evidence that retaining and analyzing this information is associated with
improved performance in problem solving.

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