I read the news today, oh boy. Everywhere writers, newscasters, pundits, and especially one multi-billionaire are talking about efficiency. As a consultant and management professor I find this very interesting. In Business 101 we teach the two “e’s”. I am only reading and seeing discussion of one “e”. Where are the discussions about effectiveness?
Efficiency is about making the best use of your resources. Getting more from your existing resources or perhaps getting the same results with less resources. Reusing rocket boosters is a great way for a space company to improve efficiency. Unfortunately for many organization improving efficiency often takes the form of saving money by eliminating positions, firing people. In the best organizations people are viewed as assets, not costs. Firing people is usually not the best strategy to reduce costs. However it is often the first.
A job does not just exist in some position description. A job is a position a person inhabits and makes their own. For most over time, people find ways to simplify tasks to be performed. They learn to whom to talk to get information, to get things done. This is called tacit knowledge, knowledge that is only developed on the job. In eliminating a person from a position, you have a good chance of losing that tacit knowledge that made that person more effective -- for example, better at providing good customer service.
Effectiveness is about achieving results intended, accomplishing the goals that have been set. You can be very effective but not efficient. You can be very efficient but not effective. The key to great organizational performance is to be both efficient and effective. In the efficiency initiatives now playing out in the media, I would like to see discussions of effectiveness.
The key to improving both efficiency and effectiveness is something often lost in organizations – accountability. Elliott Jaques (pronounced Jacks) argued that bureaucracy is actually a good form of organization. The problem is that it is rarely implemented correctly. Why? The failure to hold managers at each level accountable. Managers are responsible for the outcomes their people produce but also for developing their people.
How will the efficiency measures we read and hear about each day now affect the effectiveness of the organizations impacted?
"Rocket Launch, Night" by SpaceX-Imagery. Obtained from https://pixabay.com/photos/rocket-launch-night-countdown-693214/
© John Ballard, PhD, 2025. All rights reserved.
_________________________
Decoding the Workplace “Is this a must-have for managers and would-be managers? Yes.” Academy of Management Learning & Education. Available as ebook, hardback, paperback, audiobook, and audio CD. The best-selling audiobook and CD are narrated by Timothy Andrés Pabon.
Efficiency is about making the best use of your resources. Getting more from your existing resources or perhaps getting the same results with less resources. Reusing rocket boosters is a great way for a space company to improve efficiency. Unfortunately for many organization improving efficiency often takes the form of saving money by eliminating positions, firing people. In the best organizations people are viewed as assets, not costs. Firing people is usually not the best strategy to reduce costs. However it is often the first.
A job does not just exist in some position description. A job is a position a person inhabits and makes their own. For most over time, people find ways to simplify tasks to be performed. They learn to whom to talk to get information, to get things done. This is called tacit knowledge, knowledge that is only developed on the job. In eliminating a person from a position, you have a good chance of losing that tacit knowledge that made that person more effective -- for example, better at providing good customer service.
Effectiveness is about achieving results intended, accomplishing the goals that have been set. You can be very effective but not efficient. You can be very efficient but not effective. The key to great organizational performance is to be both efficient and effective. In the efficiency initiatives now playing out in the media, I would like to see discussions of effectiveness.
The key to improving both efficiency and effectiveness is something often lost in organizations – accountability. Elliott Jaques (pronounced Jacks) argued that bureaucracy is actually a good form of organization. The problem is that it is rarely implemented correctly. Why? The failure to hold managers at each level accountable. Managers are responsible for the outcomes their people produce but also for developing their people.
How will the efficiency measures we read and hear about each day now affect the effectiveness of the organizations impacted?
"Rocket Launch, Night" by SpaceX-Imagery. Obtained from https://pixabay.com/photos/rocket-launch-night-countdown-693214/
© John Ballard, PhD, 2025. All rights reserved.
_________________________
Decoding the Workplace “Is this a must-have for managers and would-be managers? Yes.” Academy of Management Learning & Education. Available as ebook, hardback, paperback, audiobook, and audio CD. The best-selling audiobook and CD are narrated by Timothy Andrés Pabon.
RSS Feed