Effective vs. efficient — which one would you focus on to help you grow your business? Is one more important than the other?
Effectiveness vs. efficiency has been a hot topic in the business world as it relates to growth and progress, and you can find thousands of articles citing the benefits of focusing on one over the other.
But if they're both good to practice, why are we choosing only one? It's kind of like being forced to choose between chocolate vs. vanilla, or mountains vs. oceans. What if you like both chocolate and vanilla ice cream? Or, you favor both mountains and the ocean?
When it comes to the efficient vs. effective argument, we don't think you should choose one over the other. Practice both! Businesses need efficiency and effectiveness in high amounts to derive the benefits and promote ongoing growth.
This article will discuss efficiency and effectiveness and how to combine them to get the best results for your company.
What does being effective and efficient mean? What's the difference?
Being effective and efficient might sound similar, but they have two different meanings. In his book Effective Executive, management consultant, educator, and author Peter Drucker states, "Efficiency is doing things right, effectiveness is doing the right thing."
Efficiency refers to how you do something, and effectiveness means the quality of the thing you're doing and whether it's right for your business.
For example, let's say you want to start a new loyalty rewards program. Focusing on effectiveness, you would weigh whether this program made sense for your business and it met your customer's needs and goals. The program should produce your intended outcome and align with your company goals to be effective.
Conversely, focusing on efficiency, you would put a skilled team together to execute the program and meet aggressive deadlines with a focus on productivity. Efficiency rewards you with consistent and repeatable results in a short amount of time.
Efficiency is a productivity metric, while effectiveness is a quality metric. Efficiency focuses on optimizing profitability, while effectiveness focuses on the right solutions that are necessary for long-term business growth. Effectiveness promotes long-term growth while efficiency gets you there fast and keeps your teams productive.
Which comes first? Effectiveness or efficiency?
Now that we've established that both effectiveness and efficiency are important for business success, how do you merge them together? Which one should you focus on first?
Since efficiency optimizes profits, many organizations focus on efficiency first to increase profitability in the short term.
The problem with focusing on efficiency is that sometimes businesses can neglect effectiveness when chasing short-term profits. Peter Drucker says, "There is nothing so useless as doing efficiently that which should not be done at all."
In other words, don't invest effort into optimizing campaigns that are not right for your business. You could execute the most efficient system that produces short-term profit, but also waste time and money on the wrong system for your business' long-term goals. This is why efficiency and effectiveness working in synergy is vital. Short-term profit doesn't always equate to long-term gains. Focusing on both is vital to short- and long-term growth.
Focusing on effectiveness first will set you up for success. The reason is that you will be making the right things efficient instead of wasting time on optimizing processes that are wrong for your business. Improving effectiveness leads to efficiency. Once you know what's best for your business, use that as a jumping-off point to increase efficiency.
For example, before you come up with efficient ways to sell your new product, you'd want to ensure the product is top-notch, aligns with your company goals, and will satisfy your customer base (aka, make sure it's effective).
How to become more effective and efficient in business
You might be efficient at getting work done quickly, but that doesn't mean that the work is effective or right for your business. Conversely, you could be doing excellent work on a standout product but take too long to get it to market due to inefficiency and bottlenecks.
Let's talk about ways to become more effective and efficient. We will discuss effectiveness first since it is the foundation from which all processes can emanate from.
How do you become more effective? Here are some ideas to get you started:
- Get clear on your goals: If you're not sure about your company goals, you won't be able to make decisions on what solutions will be the most effective for your business. Effective solutions align with a company's goals, so it's important to get clear on what you really want and where you'd like your company to be 1-5 years from now.
- Create strategy and metrics: How do you measure effectiveness? By creating a strategy to execute your goals and setting KPIs (key performance indicators) and metrics that tie to your goals.
- Reevaluate your plans: Dedicate time to reevaluate your company's current and future plans and strategies. Are they contributing to your long-term goals? Or are they steering you away from them?
- Discuss with your team and stakeholders: Consider your team and their opinions as you walk through these steps. Maybe a team retreat or state-of-the-company meetings can help spark some inspiration and direction.
How do you become more efficient? Here are some ideas to get you started:
- Optimize your company processes: Make a list of all of your company processes and ask your team for input on which ones they feel are a bottleneck and which ones they'd like to improve.
- Enable documentation: Start documenting your processes, ask your team to monitor their work over time, and identify where they feel a workflow can be automated, sped up, or improved.
- Streamline and automate: Streamline processes and automate to speed up workflows and make your team more productive. Example: Superhuman can make email management blazingly fast.
How to build a foundation for effective and efficient teams
We've already discussed why becoming both effective and efficient is essential in business. We also outlined some tips on becoming more effective and creating more efficient processes. An effective and efficient team understands the big-picture goals and also knows how to move swiftly to get there with ease and streamlined processes.
If you're still having issues after implementing these practices, consider building a stronger foundation.
Solving these problems and creating efficient and effective teams can only happen when you lay the foundational groundwork:
- Transparency: Keep your team in the loop on how their performance and accomplishments tie to the overall company goals. Aim for more visibility, which could mean using tools that house company data on a 360-degree dashboard (ex: CRM software).
- Clear and honest communication: You can't fix the issues if you don't know they're there. Create an environment where your team members feel heard and can be honest about how they're feeling and their struggles. We offer some advice on communication in our article on how to manage remote sales teams.
If you're a hybrid team, clear communication can be even more challenging. Luckily, we made a guide for that!
- Automation and efficiency: Invest in software and productivity tools so your team can automate processes instead of manually doing a lot of laborious tasks.
An effective and efficient email solution for busy teams
If you want an effective solution for email management that will allow your team to work efficiently, look no further than Superhuman.
Superhuman empowers teams to improve efficiency and boost productivity with the following features:
- Split Inbox: Prioritize urgent emails and eliminate distractions. Split your inbox to make email management easy and fast.
- Email organization: Archive, snooze, or schedule your emails with one click.
- Snippets: Create templates to speed up email writing.
- And more!
Get started with Superhuman and create effective and efficient inbox management for your team while enjoying a blazingly fast email experience.