In today’s economy the prosperity and success of a business lean on the level of ability of your team and how well they bring off a task. As we all know that the business environment is wavering swiftly. Organizational efficiency and effectiveness are two major paths that can yield growth and development to an organization. However, most of us get puzzled between the accurate apprehensions of both these terms. Organizational effectiveness and efficiency both are equally crucial for a successful business.

What is the difference between Organizational Efficiency and Organizational Effectiveness?

Both these terms are frequently used in the management field and operations as well. In order to depict the difference between these methodical aspects firstly we need to understand the meaning of each of them.

Organizational Efficiency – It can simply be defined as the process of doing any organizational task with great potency and expertise. An organizational efficiency can be understood as the achievement of goals and objectives with optimum utilization of resources without any wastage. When the use of few resources results in maximum output that is considered to be organizational efficiency. These resources comprise monetary, human, natural resource, organic and raw material etc. Resources are inlets in the procedure of conversion and transformation. The chief objective of efficiency is to utilize the smallest amount of resources to obtain apex outputs amid the transformation process.

Organizational efficiency can be achieved by appropriate utilization of natural and man-made resources, distribution of fine quality product and services as well. Focusing effectively on the employee training and advance education will surely help in attaining the organizational efficiency. Keeping the trending requirements of the customers in mind also supports in enhancing the level of efficiency within the organization.

Organizational Effectiveness – We need to analyze a much broader concept in case of organizational effectiveness as compared to that of organizational efficiency. Organizational efficiency is directly related to the end results. It is a process which assures final and proficient results by following certain potent steps. These steps include:

  • Leadership – In the leadership step the organization and project leaders tend to set the objectives and goals that are needed to be achieved.
  • Communication– The communication step ensures the evenly distribution of set of targets goals, responsibilities and objectives within the management and employees as well.
  • Answerability – The managers and senior team management must sustain the employees for the effective completion of assigned task and targets. It is quite crucial step for achieving organizational effectiveness.
  • Distribution and confinement – It is immensely essential for an organization to deliver the products and services to the ultimate customers. It is important for the firm to distribute their end products to consumers.
  • Performance and realization – In this particular step in the process of achieving organizational effectiveness one needs to hire and engage talented employees for the enhanced performance and achievement of goals.
  • Assessment and Evaluation – an organizational effectiveness can only be achieved with proper measurement and evaluation of process and other management projects.

Difference between Organizational Efficiency and Organizational Effectiveness






It means doing the thing rightly within an organization

Process of doing the right/correct thing.

Focus on

End Results

Maximum utilization of resources

Time Sphere

Short Run

Long Run

Type of strategy used

Introvert Approach

Extrovert Approach


Both efficiency and effectiveness are equally crucial for an organization to grow and earn hefty profit. It is important for an organization and management to keep a fair balance with these two aspects in order to maintain a successful business and a healthy working environment as well.

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