The pandemic showed the world that work can continue in most economic sectors in even the toughest of circumstances, thanks to technology. The resilience of humanity to tide over adversity was evident as we innovated, adapted and moved forward. Now global organizations are at the cusp of redefining the office workspace.
Remote, hybrid and in-office work became standard options as organizations and leaders grappled with adapting. What will work? How to navigate this minefield? There is no data and no predefined success path to follow.
Some things are becoming clear. As noted in Forbes, the belief that remote work leads to decreased productivity doesn’t hold much water. There’s been a bit of a trend back toward at least some in-office time by those who went remote, but at the height of the pandemic, 74 percent of businesses planned to shift permanently to remote work because of the increase in efficiency.
So what is efficiency? How is it different from effectiveness or productivity? Leaders need to understand these terms to improve their business performance.
The Merriam-Webster Dictionary defines “efficient” as something that produces the desired outcome with little to no waste of time or resources. On the other hand, something “effective” has the desired result, implying that resource management is not a factor. Peter Drucker summed it up by saying, “Efficiency is doing things right. Effectiveness is doing the right things.”
In business, efficiency means getting work done with fewer resources or doing more with less. Companies aim to meet their goals without wasting resources, whether time, money, materials, energy or effort. As leaders deliberate with hybrid work models as a workable solution, it becomes increasingly critical to differentiate efficient and effective productivity.
Efficient businesses:
- Identify and prioritize their objectives
- Develop strategies to get the full potential out of their available resources
The Difference Between Efficient and Effective Teams
A business needs to find the balance between efficiency and effectiveness, but this is harder than it sounds. Let’s use a typical example: developing a pitch deck. An efficient and effective team starts with project planning, creating clearly defined roles for each team member and a clear workflow and timeline. They understand their mission and know how to win the client, partner or investor.
- If a team is efficient but ineffective, the pitch deck may be ready in a shorter time, but it may miss the mark regarding the client’s needs. The team focuses on beating the deadline, not on their business goals.
- If a team is adequate but not efficient, they may build an impressive pitch deck, but it takes much longer to present it to the client. Talent may concentrate on excellent graphics or minute pitch details, which eats up the delivery time.
- Some teams are neither effective nor efficient. They can throw something together in time for pitch day. However, nobody has precise tasks on the project, and the communication is poor. Ultimately, they lose the client.
Workplace productivity is a measure of an employee’s efficiency. It considers how much output comes out in a work setting—whether an office, lab or construction site—over a given period.
Workplace productivity statistics can be shocking. Multitasking decreases productivity by 40 percent, and 91 percent of employees daydream during work meetings. However, if you focus on improving efficiency, you enjoy higher productivity in a business.
Here are some effectiveness vs. efficiency best practices.
- Link everyday tasks to company goals. Efficient teams understand how they contribute to business goals every day with better task prioritization.
- Open up the silos. The silo mentality is when specific organizational departments withhold information from others. Silos are severe barriers to efficiency and productivity. Motivate teams to be transparent with their knowledge to achieve a unified vision for the business.
- Embrace automation. In many cases, integrating automation software impacts productivity positively. With the right software solution, you can automate manual processes like inventory updates, customer service communications, employee onboarding materials and procurement processes.
- Find the source of the lag. When you become more mindful of the pain points in the workplace, you can redistribute your resources to the right team and tasks.
The Balance Between Efficiency and Effectiveness
No business can be 100 percent efficient because too many variables are constantly in play. It’s more reasonable to aim for a balance of efficiency and effectiveness. Audit your crucial business processes individually, then make gradual changes to test for improvements. The idea takes time but leads to a more productive organization in the long run.
Conclusion
Whether the business is at the conceptual, piloting stage or fully operational, the clarity between efficiency and effectiveness will help leaders drive a successful organization.
Business leaders can develop tactics, and procedures for planning, managing, making critical decisions, assessing and managing operational risks, and improving how to run business operations to make them more efficient.
An efficient business understands what needs to be done and by whom. More importantly, efficient companies know what not to do. If teams only focus on getting tasks done as quickly as possible, they burn more resources to get there. The role of an efficient leader is to gently nudge the organization using all the best practice pointers to build a highly productive business.
