Current market conditions require design and manufacturing companies to continually increase product functionality, reduce design cycles. decrease cost and improve quality One way to improve quality is to minimize the impact parr and process variation has on final product quality. Although companies know they must reduce variation, they are still struggling with executing coherent variation management strategies. To understand why companies still fail to systematically address variation, an ideal model of variation management is proposed, entitled Variation Risk Management (VRM). This model was used to assess the state of industry practice. These results are compared to the current literature available on the subject. It was found that many problems with industry implementation are due to a lack of quantitative models that enable a design ream to make quick and accurate decisions. This paper concludes with a list of interesting challenges facing the VRM field.