The Use of Variance Analysis in Manufacturing

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Recommended: Importance of variance analysis in decision making in a manufacturing industry

Analysis of Variance (ANOVA):
Analysis of variance (ANOVA) is a combination of statistical techniques in which a variance in a certain variable is divided into parts characteristic to various sources of variation. ANOVA provides a statistical evaluation of whether or not the ways of several congregates is equal and generalizes t-test of more than two groups. This technique is usually beneficial in comparing two, three, or more means of given tests, which can help businesses to identify trends. Moreover, the statistical technique is a practical tool that can be used to compare two groups either with a single independent variable or with two independent variables. It can also be used to assess differences in worker responses to employee engagement in a certain organization or to determine variations in employee productivity on specific work shifts depending on certain variables. As a result, analysis of variance is considered as a tool that can be used in manufacturing to improve or repair a process.
Variance Analysis in Manufacturing:
Since it is a statistical tool that can benefit many businesses, analysis of variance can be used across many industries to identify issues or variances between samples. The use of this technique in many industries is attributed to the fact that it is a good statistical tool for testing and a common Six Sigma instrument (“Reasons to Use the ANOVA”, n.d.). In addition to manufacturing industry, analysis of variance can be used in healthcare, service, and food sectors for various purposes.
In the manufacturing industry, analysis of variance can be used to identify the best materials to use to create a product for a customer. For instance, this process can be used by a manufacturing plant to as...

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...xplaining how much variance is caused by utilizing resources or how much is associated with the cost of using resources (Edwards-Nutton, 2008). For example, through standard costing, variance analysis helps to evaluate the costs of materials over time to identify trends and areas of concern.
In conclusion, analysis of variance is an important statistical tool that can be used in many industries such as healthcare, service, and manufacturing industries. In the manufacturing industry, this technique can be used to help in improving or repairing processes. The need to use this tool in process improvement or repair is fueled by the increased focus by manufacturers to become more demand driven. The two major ways in which ANOVA can be used for process improvement or repair include standard costing and comparison of costs, departments, and other manufacturing plants.

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