Efficiency and Effectiveness as Management Concepts

Management is one of the possible ways of how any kind of work should be organized. Management is all about coordination and the possibility of overseeing the activities different people should complete efficiently and effectively. The concepts of efficiency and effectiveness are closely connected and should be balanced in the sphere of management (Kreitner & Cassidy, 2012); still, they also have several differences and characteristics that should be mentioned (Kondalkar, 2013).

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Robbins and Coulter (2015) offer a good explanation of how these two terms should be defined. Their book helps to understand that efficiency is the quality of the work that should be done to get the best and the biggest output and benefits from the minimum of resources and efforts spent, and effectiveness is the quality of the methods used to achieve the goals set (Robbins & Coulter, 2015). In other words, when people work efficiently, they aim at doing everything properly using any means available; when people have to work effectively, they should choose the most appropriate (right) means to complete the work on a good level.

The main difference between effectiveness and efficiency is the goals of these concepts: efficiency is about the quality of the methods used to achieve the goals, and effectiveness is about the quality of the outcomes expected from the activities.

To comprehend better this slight difference, it is possible to consider the following example. There is a company with two teams of managers that are going to compete and offer their ideas on how to improve the cultural differences existing in the organization. One team offers to create a list of rules and guidelines to be followed by all workers. This is the efficient type of work to rely on. Another team suggests communicating free and discussing all aspects of possible cultural misunderstandings. These are not the most efficient methods; still, the outcomes should be effective indeed.

Example in combine effectiveness and efficiency in the work of the Leatherine Inc.

In the case study under consideration, Leatherine Inc. and its CEO, Ennio Fellini, demonstrate good abilities to combine effectiveness and efficiency in the work of the company. These two concepts have been evolved; still, the necessity to adjust some changes made Fellini shift the facilities to North Africa. As a rule, Leatherine relies on efficient methods like the attempt to follow family traditions, use only natural material for making goods, and consider the consumers’ demands the most and achieved effective results like high incomes, low-cost services, and reputation that attracts the attention of many people in the chosen region.

Now, Leatherine is challenged to change the location and search for a new group of consumers to offer its production. Fellini is obliged to make decisions and check the effectiveness is not decreased (Lopez, 2014). This is why the effectiveness of the company turns out to be influenced by its efficiency. The required changes have to be favorable to the company; therefore, it is necessary to avoid the changes in the material from natural to more eco-friendly or produce less environmental pollution. It is hard for the company to follow such requirements, and the solution to change the location and enter some new countries’ markets seems to be more efficient and winning for the company. Such conditions promote successful and effective development of the events for the company in case only efficient methods are used by its CEO.

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References

Kondalkar, V.G. (2013). Organization effectiveness and change management. New Delhi: PHI Learning.

Kreitner, R. & Cassidy, C. (2012). Management. Mason, OH: Cengage Learning.

Lopez, J.A.P. (2014). Foundations of management. Madrid: Ediciones Rialp.

Robbins, S.P. & Coulter, M. (2015). Management. Tower One, Singapore: Pearson Education.

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