Differences between Efficiency and Effectiveness? Efficiency vs Effectiveness.
Efficiency and effectiveness are both commonly used management terms. Yet, while they sound similar, they both mean different things.
Difference between Efficiency and Effectiveness:
01. Efficiency refers to doing things in a right manner. Scientifically, it is defined as the output to input ratio and focuses on getting the maximum output with minimum resources. Effectiveness, on the other hand, refers to doing the right things. It constantly measures if the actual output meets the desired output.
02. Efficiency is all about saving time, money or effort. Effectiveness is all about getting the job done.
03. Efficiency focuses on the process or ‘means’ whereas Effectiveness focuses on the end.
04. Efficiency is concerned with the present state. Effectiveness, on the other hand, believes in meeting the end goal.
05. Efficiency will look at avoiding mistakes or errors whereas effectiveness is about gaining success.
Example of Efficiency and Effectiveness in a Call Centre:
Efficiency = output (number of customer service calls taken per hour)
Effectiveness = outcome (customers who are satisfied with the answers received)
In order to be a successful organization, there needs to be a balance between effectiveness and efficiency.