Efficiency and Productivity: The Balance that Drives Success

Efficiency and productivity – two words that we use a lot. But what happens when we confuse the two? I have seen many leaders who do. 

Efficiency is about doing things right, while productivity is about doing the right things. Efficiency is the answer to “How do we optimize so that we can do same amount of work with less?” whereas Productivity is the answer to “How do we create more value with the same?” 

Both are crucial, yet I have seen business leaders either sacrificing one for the other OR focusing only on one of these. When leaders become overly obsessed with efficiency, they may streamline tasks that don’t even need to be done, missing the big picture (sub-optimisation). Being efficient requires focus on process and automation (reducing cost). Being productive requires focus on people and culture (increasing value).  This requires leaders to balance between the two, appreciate the difference and maximize both. 

“There is nothing so useless as doing efficiently that which should not be done at all.” – Peter Ducker

Haven’t we all seen cases where ambitious changes aimed at efficiency gains failed because of a poor culture? And the ones where talented and motivated individuals missing the mark due to poor systems and processes? In my view, this happens all too often in organizations. 

In her tweet, Helen Bevan writes,

“High efficiency does not mean high productivity. We can create highly efficient processes, but if people aren’t motivated to do the work or following procedures, they won’t produce results quickly.

High productivity does not mean high efficiency. We can have the most highly skilled & connected people, but if they are drowning in operational processes & red tape, they won’t produce results quickly.

If we understand the different approaches they require, we can maximise both efficiency and productivity”

If you are a member of Medium, you can read Avi Siegel’s full source article here. Here is a sketchnote summary based on distillation from Helen Bevan. 

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