What is efficiency? From whose perspective?
Just a quick follow-on to the previous post ‘Efficient versus effective‘, with a couple of insights that came up just after I’d published it.
First is that the distinction between efficient and effective is often a matter of perspective – in particular, between inside-out and outside-in:
As per the previous post, effectiveness always applies at the whole-of-system level, whereas efficiency often only seems to make sense in the terms of a single element or sub-unit of that overall system. One way to summarise this would be as follows:
- efficiency is from the perspective of inside-in and/or inside-out – the smaller scope thinking only of itself (inside-in) and/or its proposed ‘solution’ (inside-out)
- effectiveness is from the perspective of outside-in or outside-out – the broader scope thinking of the overall system’s needs from the service-provider (outside-in) and/or the overall needs of the system as a whole (outside-out)
Customers do not appear in our processes, we appear in their experiences.
If we view the world inside-out, assessing everything from our perspective, then, yes, customers would indeed seem to “appear in our processes” – and hence we’d think in terms of their ‘efficiency’ in our processes. But once we remember to apply customer-journey techniques and suchlike, to explore and balance the outside-in perspective, we also start to assess things more in terms of overall effectiveness – because if we don’t get these views into balance, the risk is that the broader system will write us off as too ineffective and inefficient to be worthwhile to be part of that broader system.
- efficiency is from the perspective of the organisation – aligning with ‘rules, roles and responsibilities’
- effectiveness is from the perspective of the enterprise – aligning with ‘vision, values and shared-commitments’
Remember, too, that all of this is recursive and fractal: ‘organisation’ is any structure, ‘enterprise’ is any overall-intent. For example, consider the case of a car, or more specifically a car-engine: the engine may be very efficient in its own terms, but in practice may not be very effective in terms of, say, the enterprise of travel, if the fuel-infrastructure to support that efficiency isn’t available (hydrogen-engine refueling, electric recharging-stations) or external factors render the efficiency moot (petrol-bowser drivers on strike, roads clogged with traffic).
Just some ideas to play with, anyway. 🙂