Strategy for Business: Are you Effective or Efficient?

It’s common for us to hear today that management consultants, advertisers, and marketing people describe their services or products as ‘effective.’  But if you are in business, can you really afford just to be effective?  Effective is defined as “adequate to accomplish a purpose; producing the intended or expected result”.  If you are the Chief Information Officer for your organization, will being effective be enough?  Are you comfortable explaining to your governing board that you were adequate with your implementation of a new system?

‘Efficient’ is defined in the dictionary as “performing or functioning in the best possible manner with the least waste of time and effort; having and using requisite knowledge, skill, and industry; competent; capable”. It seems to me that an organization would prefer to be efficient in their implementation of a new system.  After all, we are usually talking about a lot of time and money when considering a new system. I would much rather be known as having a competent system than an adequate one. As a management consultant, I would prefer to be known as being efficient.  I think our clients would prefer that we be efficient.  None of us want to be just adequate.

Many times we are not efficient in our actions because we didn’t start out with a plan.  There are some organizations that will begin to spend money on projects with no definitive outcomes identified. These same organizations will allocate human resources without time schedules and expectations identified. After losing control of the situation, these organizations may frantically call in management consultants to “fix” the situation. In my opinion, if more strategic planning is done from the beginning, less costly mistakes will be made in the long run.  It is always an expensive venture when you have to start a project over because of poor planning and communication. This in itself is the epitome of inefficiency.

Efficiency can begin by asking questions, such as the following:

  • What is the current situation?
  • What do you want to change?
  • Why do you want to change anything?
  • What are the pros and cons of the change?
  • What 3-5 goals do you want to accomplish with the change?
  • What are the objectives that need to be completed?
  • Who is involved with these changes?
  • What are the budget requirements?
  • What is the communication plan?
  • What are the timelines?
  • What are the internal and external resources needed?

Taking the time to ask questions, analyze the answers, and establish a strategic plan with specific action steps designed to move the organization toward its goals will prevent both inefficiencies and ineffectiveness.  There are some that will compromise the planning step because of perceived pressure or general impatience of leadership.  It should be an intentional and deliberate decision to be efficient in your strategic planning process.    Will you be adequate or competent?  As a leader, you will determine the direction of the company.

1 Comment

  • Brad Closson June 22, 2010 at 5:37 pm

    Very interesting perspective. I think that while being “efficient” is usually what companies are shooting for in operations and systems, “effective” is what they hope to achieve with people. Managers in particular need to be effective. This may take more time and resources, but an effective manager is incredibly important to any company.

    I think that every situation if slightly different, and depending on the issue at hand, it may be better to be either effective or efficient. These words are sometimes interchanged but I think the key is realizing that we are usually searching for both an effective and efficient outcome.

    Good thoughts Penny. Thanks for sharing. Keep them coming.

    Connective Management

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