Effectiveness, efficiency, and productivity – what do they mean?

Effectiveness, efficiency, and productivity – what do they mean?

In our years of experience working in and with businesses, we’ve noted that professionals use three words on a constant basis: effectiveness, efficiency, and productivity. These terms are used from top to bottom within a business and across multiple industries to try and quantify organizational and individual performance. However, do we really know what they mean? Are they even supposed to be used interchangeably?

Before writing this post, we checked a few popular blogs. Surprisingly, the content that we found did a much better job at confusing than clarifying. Therefore, we believe that by explaining the terms clearly and concisely, we can all use each word for the right setting, improve our overall use of language and strive to achieve higher levels of each measure in our work.

What is Effectiveness?

Effectiveness is equivalent to “doing the right things.” Whether or not we are being effective comes down to a simple question: is the action we are taking achieving the intended outcome? If so, then we can consider our action effective. If not, then it is ineffective.

For example, as knowledge workers, we typically keep our email client open when we work. However, under the current communication paradigm, is this really effective? All day, we receive countless emails that interrupt us and often force us to move away from our priorities as we’ve been trained to believe every ding, beep or buzz requires immediate attention. Without a means to prioritize and filter those emails, the current email paradigm prevents us from working effectively as it keeps us from doing the right things to achieve our overall intended objectives.

What is Efficiency?

Efficiency is a totally different concept. Colloquially, when we are being efficient, we are essentially “doing things right.” To determine if you are being efficient, you should ask yourself: am I working on my task in the best way possible? If the answer is yes, then you are being efficient!

Efficiency is a term rooted in the world of manufacturing. Essentially, one can think of efficiency as an inverse function of energy. The less energy a machine needs to produce something, the more efficient the machine.

When we apply the concept to knowledge workers, efficiency is a function of the time and energy needed to fulfill certain tasks. With that in mind, knowledge workers are more efficient when they can fulfill a particular task with a single click versus alternative time-consuming procedures. For example, Knowmail’s “next best action” feature helps knowledge workers be more efficient as it streamlines and organizes their emails with the click of a button!


 

 


What is Productivity?

Productivity is a more complex term as it combines effectiveness and efficiency. Productivity is different from efficiency as it assesses a process as a whole rather than one thing at a time. Being productive means that you maximize output for your total input. Therefore, in a sense, you need to be both effective (doing the right things) and efficient (doing things the right way) in order to be productive.

Productivity is easiest understood in the context of an assembly line. Productive assembly lines maximize “y” output for total “x” input. For example, an assembly line that produces maximum cars per input of workers is considered a productive line.

Effectiveness, efficiency and productivity are words we’ve all used interchangeably in our professional lives. However, we often use those words in incorrect contexts. We hope that this post has cleared up some of the ambiguity, and that together, we will be more empowered to communicate effectively, boost efficiency, and therefore improve overall productivity![1][2]

[1] I appreciate Nathan Zeldes contribution to this article

[2] http://www.aipa.ca/wp-content/uploads/2013/11/pap_Tangen2002-UnderstandingTheConceptOfProductivity.pdf

 

Oded Avital
Oded Avital

Oded Avital is Knowmail's co-founder and COO with over 20 years experience in sales, Biz Dev, product and operation management in corporate and startups.

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