Resource Change creates Production Variance

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Posted on by Arslanguler

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Hi,

When a resource is changed in the production order, whether from Resource Group or Resource, it creates a production variance. Even the cost categories are the same it creates a variance. This is a very normal process, as routings have resource groups and planning assigns a resource within the group.

Any idea or way to avoid this?

Thanks in advance...

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Ankit Batra 1,561 on at

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RE: Resource Change creates Production Variance

Hi Arsalan,

Missed responding earlier. The issue still exists. See details below that you asked.

Product Standard Cost:

Production Variance:

Overview Costing on Production Order:

Thank you for help.

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Arslanguler 149 on at

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RE: Resource Change creates Production Variance

Hi Ankit, I almost sure that we were having no variance from a resource change if only cost category is the same. Do you have screenshots of variance screen (detailed=yes) and Production Order >View Calculation details > Overview Costing TAB

Good luck

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Ankit Batra 1,561 on at

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RE: Resource Change creates Production Variance

Hi Arslan..We are facing the same issue..in our case during item cost rollup the cost is estimated using the resource group and during production order estimation a resource is ultimately selected/estimated. We are overall getting zero variance since the cost categories/cost are exactly the same but we get quantity and substitution variance which nets out each other to zero. Is this what you see as well? It creates lots of noise in GL and in our case the GL accounts for these two variance types are different which adds to the problem.

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Arslanguler 149 on at

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RE: Resource Change creates Production Variance

Back to that old dated question... I know the answer now :)

We had seen that variance is created if the cost category is different on the route. So, you can use different resources in the production order and as far as they have the same cost category, system will not create a variance. So for planning or production purposes, you can use different resources. AX will create variance only if cost category is different. Enjoy :)

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ColbyGallagher 3,666 on at

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RE: Resource Change creates Production Variance

When you say variance, do you mean an actual posted variance when you End the order, or just on the costing sheet on the production order shows resource A under consumed, and resource B over consumed?

What is your production control -> setup-> parameters -> general -> Ledger posting set to?

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Ludwig Reinhard Microsoft Employee on at

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RE: Resource Change creates Production Variance

I understand what you mean but the very nature of the standard cost principle behaves that way. All the best, Ludwig

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Arslanguler 149 on at

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RE: Resource Change creates Production Variance

Hi Ludwig,

Yes we are with standard cost. The resources are so identical in terms of rates, hours, etc... So on monetary view, there is no difference. And they are able to be produced any of those WCs. So having a variance for that change does not seem meaningful.

Thanks for response.

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Ludwig Reinhard Microsoft Employee on at

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RE: Resource Change creates Production Variance

Hi,

You must work with standard costs right? Why you do not want to have a variance if resources are changed? Recording a variance in your case is a main feature of the standard cost model. If you don't want to have this variance you should think whether the standard cost model is what you want\need.

Regards

Ludwig

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