When using a RAG (Red, Amber, Green) scoring system on control charts for cost and schedule, would you score a variance from green to amber and then to red the further you move away from a zero variance, no matter if it is favorable or unfavorable?
For example: if your baseline for costs was $1,000 and your RAG scoring was green for 0 to 5%, amber for 6% to 8%, red for 9% and greater, would you score red for both a variance of $110 either favorable (under running) or unfavorable (overrun)?
What about if you're scoring revenue? It seems counter-intuitive to report a favorable variance in red if you exceed your plan by x points; however, you are still that far away from plan. Would using "red" in the score to draw attention to the variance, maybe to exploit and enhance whatever is going right, be appropriate? Or does the red score just indicate something bad?