Productivity, efficiency and effectiveness are not the same thing
Today we will clarify these three concepts that are often used as synonyms, but in reality they are not.
Do you know the difference between productivity, efficiency and effectiveness?
These three concepts are key to any organization, but they are often confused. Below is an example for each one that will help you understand how to apply them to improve your management:
1️⃣ Productivity: Imagine that your company produces 100 units in 8 hours with 5 workers. If you can get those same 5 workers to produce 120 units in the same time without increasing resources, you have improved productivity.
2️⃣ Efficiency:If instead of producing 100 units, you now manage to produce the same 100 units, but reducing energy consumption or the time needed per operator, then you are being more efficient, because you have optimized the use of your resources.
3️⃣ Effectiveness: Let's say the goal was to produce 100 units of acceptable quality in 8 hours, and you achieved that goal. No matter how you did it or how much effort it took, you achieved efficiency, because you met the goal.
Conclusion: After analyzing real cases in the company, we came to the conclusion that improving productivity, efficiency and effectiveness is essential to achieve better results.
The question I leave you to answer is: How do you manage these pillars in your organization?
I am Dr. Roch. Follow me on my retreats to deepen your practice of these business improvement tools.
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