Effective / Effectiveness & Efficient / Efficiency
Effective and Efficient OR Effectiveness and Efficiency –
These words are very commonly used in our day-to-day work environment. In any
industry or business (manufacturing or service), a comparison always been made
between individuals or processes or system or anything on the basis of these
two parameters. But meaning or concept behind these two words is bit confusing.
Explaining these 2 words below with a simple example.
Dictionary Meaning
Meaning of Effective is – Having the power to produce a
required effect or effects – Producing a decided or decisive effect.
Meaning of Efficient is – Making good, through or careful
use of resources; not consuming extra – Especially, making good use of time and
energy (money).
Effective mainly concerned about completion of a task
(completed or not) but not on how it has been done (at what cost or resources
consumed).
Effective is to have pre-decided or desired or target
effect whereas Efficient is achieving result with minimal wastages or no
wastages.
Management expects all employees to be Effective and
Efficient and not only Effective OR only Efficient. This task is not easy. Both
Effective and Efficient are subjective and in comparison, to others. Hence, it’s
of most importance to strike a balance between these two. One can’t afford only
to be Effective OR Efficient, but it has to be Effective
and Efficient. Both these concepts are widely used for employee’s
performance measurement and annual appraisals thereby increments.
Both are an important and useful management tools for employee’s
performance indicators / assessment. As both these parameters are interrelated;
should be utilized concurrently. Both these terms are expected to provide
motivation to employees for further improving their performances.
Effective or Effectiveness
Efficient or Efficiency
Let's us understand this further with a help of a very
simple example; real life situation will be more complicated.
Example
Task
Let’s consider a task of picking up a envelop from a place and to deliver it to
another place. A envelop is to be picked up from a Town industrial area which
is about 4 kms away from town bus stand. It has to delivered in another city which
is about 40 kms away from the town and place to be delivered is about 5 kms
from City bus stand. Three different person A, B and C has been assigned the
same task.
Person A
Person A collects the envelop and hires a taxi straight
from Town office to City office. As per the prevailing rates, taxi will cost
him about Rs. 12/- per km and total charge for 49 (4 + 40 + 5) kms will be Rs.
588/- (49 x 12). He will deliver / complete the task in 1.00 Hr. (mainly travel
/ driving time from town office to city office). Means he has completed the
task in 1.00 Hrs at cost of Rs. 588/-.
Person B
Person B collects the envelop from Town office and walks
down to local bus stop near to office. From bus stop, takes a local bus to Town
Bus stand (@ 4 Kms., 0.75 hr, for Rs. 5/-). From Town bus stand intercity bus
to City bus stand (@ 40 kms. 1.50 hrs, for Rs. 50/-). From City bust stand he takes
local bus to City office (@5 kms, 1.00 hrs, for Rs. 8/-) to deliver the
envelop. Means he has completed the task in 3.25 hrs. (0.75 + 1.50 + 1.00) at
cost of Rs. 63/- (5 + 50 + 8).
Person C
Person C collects the envelop from the Town office and
hires a taxi from Town office to Town Bus stand (@ 4 Kms., 0.25 hrs, for Rs.
48/-). From Town bus stand he takes an intercity bus to City bus stand (@ 40
kms., 1.50 hrs., for Rs. 50/-). He hires a taxi from City bus stand to City
office (@ 5 kms., 0.5 hr., for Rs. 60/-). Means he has completed the task of
delivering envelop at City office in 2.25 Hrs. (0.25 + 1.50 + 0.5) at cost of
Rs. 158/- (48 + 50 + 60).
Inference
For our better understanding, let’s summarize the perform
in a tabular form.
|
Person |
Total
Time taken, Hrs. |
Total
Cost, Rs. |
|
A |
1.00 |
588/- |
|
B |
3.25 |
63/- |
|
C |
2.25 |
158/- |
Its evident from the above data that Person A is Very Effective
(taken only 1.00 hr.) but Not Efficient (spend Rs. 588/-). Person B
is Not effective (taken 3.25 Hrs.) but Very Efficient (spend only
Rs. 63/-). But Person C is very impressive as he is Effective
(taken 2.25 hrs.) and also Efficient (spend Rs. 158/-). Person C has struck
a balance between delivery time and cost. In both the parameters Person C is
neither a highest nor lowest but has delivered in optimum time and at optimum
cost. Therefore, Person C is Effective as well Efficient.
In the above example, only 2 parameters; time and cost has
been considered as it was easy to understand. But in real life, there could be
more or different parameters such as quality, productivity and so on.
