To make it easier to understand, let’s first look at the definition of each of these aspects. Then we’ll follow up with an example to help clarify each concept:
- Effectiveness is the ability to achieve the intended objective or expected result (as planned) regardless of the resources used, the time spent, or the methods employed.
- Efficiency is the ability to achieve the objective (the expected or planned result) using the fewest resources, the shortest time, and the least effort possible.
In other words, effectiveness is strictly related to reaching the goal. For example, imagine your objective is “to arrive at work on time.” If you leave your house and arrive at work at the right time, you were effective, regardless of the route taken, the mode of transportation, or the cost incurred.
Conversely, efficiency is about achieving the goal in the best possible way—with less effort, lower cost, and more speed. Using the same example, being efficient would mean arriving at work on time (meeting the expected result) but by taking a shorter, more economical route in less time.
To sum up, effectiveness is related to “what” we want to do or achieve, while efficiency is about “how” we can do it with greater economy and speed. Both concepts are extremely important, and depending on the company’s context or the action being performed, one may need to be emphasized over the other.
Applying the Concepts
Here are some simple examples of business scenarios where understanding the difference between effectiveness and efficiency can be crucial for your work. You’ll see that properly grasping these concepts will help you choose an approach that combines both:
- Process Implementation: Ensure that objectives are met (effectiveness) using minimal resources (efficiency).
- Problem and Non-Conformance Resolution: Address the root causes definitively (effectiveness) without wasting time, incurring losses, or extra costs (efficiency).
- Strategic Planning: Prioritize actions that ensure objectives are achieved (effectiveness) in the best possible way without compromising the company’s financial health (efficiency).
- Performance Evaluation: Measure whether results are achieved (effectiveness) in an optimized manner, avoiding excess (efficiency), thereby ensuring profitability.
- Training: Ensure that the methods applied are effective in acquiring skills and efficient in terms of cost, so more people can be trained.
- Project Management: Organize resources and deadlines to achieve objectives as quickly and cost-effectively as possible, ensuring both the effectiveness of reaching results and the efficiency of resource usage.
- Product and Service Development: Create solutions that truly meet the customer’s needs (effectiveness) without wasting resources or missing the required timing (efficiency).
- Continuous Improvement: Optimize internal processes to achieve the same desired results (effectiveness), but in a faster, cheaper way and without rework.
Effectiveness and Efficiency in the Context of ISO Certifications
Even though efficiency is fundamental in any company, when it comes to certifications, the primary focus is on effectiveness.
During audits, the certifying body will prioritize ensuring that the objective has been achieved. This is because the mission is to assess the company’s compliance with the audited management system. In other words, the certifier will analyze whether the company follows the best practices of the audited standard in its day-to-day operations.
For example, when addressing a non-conformance, the evaluation will determine whether the actions taken resolved the root cause and eliminated the risk of recurrence. In this context, it is not judged whether the company did it in the fastest possible manner; the key point is that compliance was achieved.
Read more: Understanding “Context of the Organization” ISO 45001:2018
Two Concepts, One Goal: Your Company’s Success!
As we’ve seen throughout this text, understanding the difference between effectiveness and efficiency is essential for organizing your company and acting in a more assertive and focused manner.
Understanding effectiveness is crucial to achieving any process objectives, but incorporating efficiency ensures that these objectives are met with minimal cost and effort. Together, effectiveness and efficiency guarantee sustainability and good results in the short, medium, and long term, making processes viable and better for all stakeholders.
Your role now is to continually reassess your methods, aiming to avoid bureaucratic, complex, and costly management systems that add no value to the company or its customers. When effectiveness and efficiency go hand in hand, the result is solid and sustainable continuous improvement—a true “win-win” that creates a healthy, mutually beneficial relationship for everyone involved.
