What is Efficiency and Effectiveness?

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.

The relationship between effectiveness and efficiency is that effectiveness is a measure of ‘goodness’ of output, while efficiency is a measure of the resources required to achieve the output. Thus effectiveness of the system refers to the quality of outputs from the system.

Efficiency and effectiveness are two buzzwords that get thrown around a lot in the business world. However, they are frequently employed incorrectly and interpreted poorly.

Incorporating a methodology that is both effective and efficient is the goal of every business.

Efficiency is doing things the right way, while effectiveness is doing the right things. Something is effective if it produces the intended result, whereas it is efficient if it functions with the least use of resources. It is possible to be effective without being efficient and vice versa.