diff --git a/erpnext/manufacturing/doctype/work_order/work_order.py b/erpnext/manufacturing/doctype/work_order/work_order.py
index 8a39f7420e9..a7e1acc524c 100644
--- a/erpnext/manufacturing/doctype/work_order/work_order.py
+++ b/erpnext/manufacturing/doctype/work_order/work_order.py
@@ -382,6 +382,9 @@ class WorkOrder(Document):
 		return holidays[holiday_list]
 
 	def update_operation_status(self):
+		allowance_percentage = flt(frappe.db.get_single_value("Manufacturing Settings", "overproduction_percentage_for_work_order"))
+		max_allowed_qty_for_wo = flt(self.qty) + (allowance_percentage/100 * flt(self.qty))
+
 		for d in self.get("operations"):
 			if not d.completed_qty:
 				d.status = "Pending"
@@ -389,6 +392,8 @@ class WorkOrder(Document):
 				d.status = "Work in Progress"
 			elif flt(d.completed_qty) == flt(self.qty):
 				d.status = "Completed"
+			elif flt(d.completed_qty) <= max_allowed_qty_for_wo:
+				d.status = "Completed"
 			else:
 				frappe.throw(_("Completed Qty can not be greater than 'Qty to Manufacture'"))
 
@@ -809,4 +814,4 @@ def create_pick_list(source_name, target_doc=None, for_qty=None):
 
 	doc.set_item_locations()
 
-	return doc
\ No newline at end of file
+	return doc