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On Efficiency & Effectiveness

Efficiency and effectiveness are two closely related but distinct concepts.


Efficiency is the ability to accomplish a task or achieve a goal with the least amount of wasted resources or time. It is the measure of how well resources are used to achieve a given outcome. An efficient process is one that gets the most output for the least input.


Effectiveness, on the other hand, is the ability to achieve a desired outcome or goal. It is the measure of how well the task or goal is being accomplished. In short, it produces the desired results.


To illustrate the difference, a company may be efficient in its production process, but if it is producing a product that no one wants to buy. So, it may be efficient but not effective. On the other hand, a company may be effective in terms of selling a product that people want, but if it is producing that product at a very high cost, it is not efficient. A balance between the two is ideal, achieving both high efficiency and high effectiveness, but striking that balance can be challenging.


Here are my favorite quotes on the topic:

  • "Efficiency is doing things right; effectiveness is doing the right things." - Peter Drucker

  • "Efficiency is going from failure to failure without loss of enthusiasm." - Winston Churchill

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