Select the incorrect statement concerning the human factor of performance evaluation.
A) Variances should not be used to single out managers for punishment.
B) Variances must be analyzed carefully to ensure that they are fully understood.
C) Just because a cost variance is labeled as favorable doesn't necessarily mean that the manager should be commended for a job well done.
D) Managers should always be punished for unfavorable variances.

Question

Quizplus · Accepted Answer

Punishing managers for unfavorable variances without understanding the underlying reasons for the variance may lead to demotivation, decrease in productivity and fostering a culture of fear which ultimately will not benefit the organization. Evaluating human factors of performance should focus on understanding the root cause of the variance and identifying opportunities for improvement rather than solely seeking to punish or reward managers.

Select the Incorrect Statement Concerning the Human Factor of Performance