What is the difference between process effectiveness and process efficiency?
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In the case of Effectiveness, it has an extroverted approach, that highlights the relationship of the business organisation with the rest of the world to attain a competitive position in the market, i.e. it helps the organisation to judge the potency of the whole organisation by making strategies and choosing the best means for the attainment result.
Show While efficiency refers to how well something is done, effectiveness refers to how useful something is. For example, a car is a very effective form of transportation, able to move people across long distances, to specific places, but a car may not trasport people efficiently because of how it uses fuel. Comparison chartEffectiveness versus Efficiency comparison chartEffectivenessEfficiencyMeaningEffectiveness is about doing the right task, completing activities and achieving goals.Efficiency is about doing things in an optimal way, for example doing it the fastest or in the least expensive way. It could be the wrong thing, but it was done optimally.Effort orientedNoYesProcess OrientedNoYesGoal orientedYesYesTime orientedNoYesUsing Effectiveness and EfficiencyEffectiveness is about doing or using the right things — things that yield positive results. Efficiency is simply about doing things right — i.e., completing a task cheaper or faster. Ideally, individuals and companies find ways to be effective and efficient, but it is possible to be effective, but not efficient, or vice versa, or neither. For example, if a company is not doing well it may decide to train its workforce to use a new technology. The training may go well, with employees learning the new technology in record time, but if overall productivity doesn't improve following the implementation of this new technology, the company's strategy was efficient but not effective. In the following video, William McDonough, co-author of The Upcycle: Beyond Sustainability--Designing for Abundance, speaks about efficiency vs. effectiveness: It is important for managers to understand what to manage, why it's important and how to do it. This is where efficiency and effectiveness come in. By Andrew Gager Maintenance & Operations This article was first published in 2018 and has been updated to reflect current information. Managers need to understand what to manage, why it’s important, and how to do it. This is where the concepts of efficiency and effectiveness come in. By understanding the difference between these two, managers can achieve success.
Efficiency measuresOne measure of maintenance efficiency is total maintenance costs compared to replacement asset value (RAV). Some refer to this as equipment replacement value (ERV). It is defined as the monetary value that would be required to replace the current assets in the organization. It includes production and process equipment, as well as utilities, support, and all related costs. For example, in the past 12 months, I have had some maintenance expenses. My current RAV is $425,000. Here are my home maintenance expenses for the past 12 months:
Total: $13,030 Based on these expenses, the ratio of total maintenance costs to RAV is 3.1 percent — divide $13,030. by $425,000, then multiply the result by 100. This is important because by understanding the costs associated with maintaining assets, managers can determine the best methods to get a company’s RAV ratio down to 3 percent, then 2 percent and finally 1 percent of maintenance cost as a percentage of RAV in order to reach operational and maintenance success. Managers are responsible for determining the most appropriate mix of physical asset policies, work management, and reliability improvement processes to reduce the costs of non-value added or recurring expenses. In my example, some expenses might be considered capital expense or improvements. For example, I won’t replace my roof annually, but there are recurring maintenance costs that I can control. Perhaps I purchase a higher quality shingle, for example. Another measure of maintenance efficiency is corrective maintenance (CM) versus preventive maintenance (PM). Evaluating total maintenance costs to RAV does not naturally give enough detail to identify where costs are applied. Total man-hours spent on CM versus PM can help managers determine if maintenance practices are effective at preventing unscheduled downtime and reducing CM. The percentage of work planned as opposed to emergency or corrective repairs is also an effective measure. Remember that emergency work is typically three-four times more expensive than planned work. PM/CM compliance is a measure that follows closely with CM vs. PM ratios and a good measure for efficiency. The purpose of the PM is to schedule activities so technicians can spot deficiencies before they evolve into more costly problems. So it is important to complete these PMs and to do so them on time. CM includes maintenance done to return items to proper condition. Consider my home PM/CM compliance for April:
My PM/CM compliance was 78.85 percent — days task completed divided by days task scheduled. Why is this important? What are the consequences of failure by not achieving my schedule compliance? Not making coffee, for example, just means I don’t get my morning jolt. Missing a week of cutting lawn means I have an unusually high grass that probably needs to be cut twice. It’s essential that managers understand the consequences when deciding whether to perform PM or CM or defer the task. Andrew Gager — [email protected] — is CEO of AMG International Consulting. He is a professional consultant and facilitator with more than 20 years of partnering with organizations in achieving strategic objectives and goals. What is the difference between effectiveness and efficiency of any process?Efficiency and effectiveness are not the same thing. Efficiency is defined as the ability to accomplish something with the least amount of wasted time, money, and effort or competency in performance. Effectiveness is defined as the degree to which something is successful in producing a desired result; success.
What is the difference between effectiveness and efficiency with examples?While efficiency refers to how well something is done, effectiveness refers to how useful something is. For example, a car is a very effective form of transportation, able to move people across long distances, to specific places, but a car may not trasport people efficiently because of how it uses fuel.
Which is better between efficiency and effectiveness?The truth is that effectiveness is far more important than efficiency. According to diffen.com, effectiveness is about doing the right task, completing activities and achieving goals. Efficiency is about doing things in an optimal way, for example doing it the fastest or in the least expensive way.
What is process efficiency?What is process efficiency? The definition of process efficiency is essentially “the amount of effort or input required to produce your business's product.” For instance, if it takes 300 workers to make a single pack of gum, your process efficiency is abysmal. And you should get out of the gum manufacturing business.
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