Organisational Effectiveness: Process efficiency or process effectiveness?
Process efficiency and effectiveness are words often used interchangeably, but the reality is that business need to consider both process efficiency and process effectiveness to optimize revenue and profits.
Process Efficiency
Process efficiency refers to the close tracking and monitoring of the performance of existing processes. It is an important aspect when measuring productivity and is often a pertinent aspect during the implementation of new technology.
“The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify inefficiency.” – Bill Gates
Regular review of the input provided by internal (team members) and external (customers) stakeholders serve to measure how efficient the allocation of resources is, efficiency in the execution of tasks and outcomes. Reducing waste and costs, improving productivity and customer services (doing what is right) are amongst the things that continuously drive improvements in operational efficiency.
Process Effectiveness
The relevance and applicability of a process, measures the effectiveness of it. Is it fulfilling the needs and demands of internal and external stakeholders? An effective process will provide the right outcomes (doing the right things) for its stakeholders, at the right cost, the right time, and the right place.
“Excellent firms don’t believe in excellence – only in constant improvement and constant change.” – Tom Peters
Constant innovation and change through stakeholder engagement and interaction, supports the notion that business excellence is achievable. Regular reviews and assessments of process effectiveness is a business imperative and ensures that processes remain relevant and deliver on business objectives.
Consider process efficiency and effectiveness on a continuum where both process efficiency and effectiveness are required to ensure that strategic and operational business objectives are achieved.
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