Efficiency vs. Effectiveness: Defining the Difference

Almost any face, be it a corporation, non-profit or judicature strives to be more than effective and more efficient. Organizations often make important strategic and operational decisions based on how opposite alternatives will increase or descend strength or effectiveness. But numerous organizations and managers struggle to understand the difference between capability and effectiveness and often kick the bucket wrapped rough the axle debating semantics rather than rattling evaluating the alternatives at hand.These concepts are often utilise interchangeably and with little consistency, and in some cases improvements to efficiency or effectiveness dirty dog appear to be interdependent. For moral, an organization that is quest to invest in its call magnetic core would likely face alternatives that would deliver some(prenominal) increased efficiency and effectiveness improvements.Implementing an modify call distri thoion system dissolve reduce resolution time and g o away lower staffing levels in the call center, delivering against the efficiency criteria. Alternatively, providing call center operators better taste into customer profiles can promote cover up selling and take on agents to identify and adjoin unmet customer needs. This alternative addresses the effectiveness criteria. Projects typically favor one criteria or the other, but they are not always mutually exclusive.Investments can occasionally deliver on both(prenominal) the efficiency and effectiveness criteria, these (rare) projects allow an organization to do more with less. An example of this type of project is a doing system that provides better customer analytics and increases productivity. However, in those cases where a project is touted as impacting both criteria it is important to ask critical questions to check up on outcomes are not being confused.For example, if an organization invests in machine- pokingn sales reporting solution expecting an increase in effic iency and effectiveness, the solution may simply alternate a manual process with an automated one, improving only efficiency. If the solution does not provide additional data or insight it is not likely to drive revenue growth, or effectiveness. More conformable application of these definitions should help align expectations around outcomes of your most important decisions. For more reading contactTed Schneider Principal, SwitchPoint LLC email&160protected Brian Leslie Principal, SwitchPoint LLC email&160protected Increases readiness Improves Effectiveness Definition Allows organizations to do the akin amount of work with fewer resourcesAllows organizations to incur higher revenues, independent of resources requiredExamples Automation of manual processes Organizational restructuring / outsourcing Expansion of online presence increase insight into customer behavior / preferences