Month: June 2023

You might know the difference between Effectiveness and Efficiency, but repetition might not harm since I still see many people mixing up those two terms.

Many people might need help differentiating between the two concepts when it comes to effectiveness versus efficiency. They are often confused and used interchangeably, but there is quite a significant difference between them. In this post, we will explore the definitions of effectiveness and efficiency, give an example to illustrate the difference, and explain why it is essential to differentiate the two.

Definition of Effectiveness

Effectiveness refers to the ability of an individual or organization to achieve desired goals and objectives. It is focused on achieving high-level outcomes and determining whether they have been achieved. Simply put, effectiveness measures whether you get what you want out of something. Effectiveness is about the WHAT, about doing the right thing.

Definition of Efficiency

On the other hand, efficiency is focused on accomplishing tasks or achieving goals in a timely and cost-efficient manner. It measures how quickly something can be accomplished or how few resources are used. In other words, efficiency measures if you’re doing things right. Hence efficiency is about the HOW, about doing things right.

Example to Illustrate the Difference

To illustrate the difference between effectiveness and efficiency, consider a factory aiming to produce 10,000 items. The factory might be effective if it produces 10,000 items in the end, but inefficient if it takes them two months or more. On the other hand, they could be considered efficient if they could produce 10,000 items in one month, but not effective if they only produced 5,000 items for whatever reasons.

Importance of Differentiating Between Effectiveness and Efficiency

It is essential to differentiate between effectiveness and efficiency because it allows us to assess how well something is being done. By understanding the difference, we can focus on achieving desired outcomes (effectiveness) and optimizing the process to accomplish those outcomes more quickly and cost-effectively (efficiency). Knowing which one is more important to focus on depends on the individual situation, but it is always beneficial to be aware of both factors. This helps ensure that we make the best use of our resources – time, money, and energy – to reach our goals.

Here is another example I am using regularly to explain the difference. Imagine you want to climb a wall with a ladder, not only once but many times. So you climb and climb again, and eventually, you become much faster at climbing up the ladder. This is improved efficiency. You become faster and faster to jump up the ladder.

Now is the entire exercise effective? This depends if the ladder is leaning on the right wall. You can be as fast and efficient as possible; you are only effective if you choose the right climbing wall.

In conclusion, effectiveness and efficiency are two separate concepts that must be understood to effectively manage any task. Effectiveness measures the results of a task, while efficiency examines how quickly and cost-effectively it was accomplished. Knowing the difference between the two helps us ensure we’re not spending too much time doing something inefficiently that could have been done more effectively, and vice versa. Therefore, it is essential to differentiate between effectiveness and efficiency to ensure the best use of resources and reach desired goals.

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One approach or let’s call it a framework in Quality Management is the GAP framework. The purpose of this framework is to find out the areas, where to focus on. There are so many areas in quality management to look into and to improve, but we can’t look at all of them of course. We need to focus on the important ones and those can be different in any company or team.

Hence, one of the first activities should be to identify the battles worth fighting and to define where to attack first.

The main question the GAP framework is asking is the following: Is there a gap between how you manage quality and how you should be managing quality?

And when trying to find answers to that question, look into the following areas:

• Management and customers
• Individual and company goals
• Procedure and execution
• Company promise and follow-through
• Customer expectations and experience

So, what does that mean?

GAP Framework Areas

Management and customers

With management, I mean here primarily the decision maker in a company. And quite often there is a mismatch between what management thinks a customer needs or wants, and what the customer really needs or wants. And this might have several reasons. Sometimes customers don’t even know what they need to be successful or sometimes the customer is phrasing it in a misunderstanding way. And sometimes the company simply ignores the customer’s voice or believes to know better. Whatever the reason is, it leads to a gap between the company and the customer, impacting the business. So, how to identify those gaps? Let’s start by looking at the communication and communication channels between both. Is customer feedback being taken into account? Is there a proper process in place to ensure that customer needs are met? Are there ways to measure customer satisfaction, e.g. using NPS (Net Promoter Score)? Is there a good way for customers to communicate feature requests? Has your Sales team a good relationship with your key customers? And there are thousand similar questions. Uncovering these gaps is key to do the right Quality Management actions to improve business results.

Individual and company goals

Quality gaps often arise when individual goals do not align with those of the organization. And this happens more often than you think. But how can this happen? Well, there are many reasons and many of them have to do with communication. Sometimes there is no company vision or mission and no company strategy or goals. And even if meanwhile most companies have those, they are not properly communicated by the higher management teams. And even if they are, very often the communication breaks when passed down the ranks, especially in organizations with many hierarchy levels, and the strategy will not make it all the time to each and every employee. In addition, it highly depends on the middle management to translate the company strategy and goals into clear team and individual goals, understood by each and every team member. Often those managers are not enabled or trained to break down those goals and to explain to every team member how he or she fits into the overall strategy. Luckily this can be found out easily. Simply ask a few employees if they know the company’s vision, mission, strategy, or goals and ask them to explain how their individual goals and career paths are aligned with those.

It is so important to identify any discrepancies between what individuals want to achieve versus what the organization wants to accomplish as this could lead to so many misunderstandings and misalignments down the road.

Procedure and execution

Quality issues may manifest if procedures are not followed properly during execution or if they have been poorly designed from the start. Most organizations fail already by not having processes in place at all or insufficiently. Without processes, there is too much room for interpretation, errors, and misunderstandings, and consequently, business results are comparable with lottery results. Hence you better try to understand your process landscape and identify gaps. You can do that by external consultants or by asking your employees questions like: What are you doing currently and can you show me the process describing that step? How do you make sure to not forget steps A, B, and C, can you show me the checklist you are using? How do you get to know if there is a dependency to or from your work and how do you resolve that dependency? But this is only the first part. The second is to make sure that existing processes are followed. Here you can ask questions like: How do you know that you are doing a good job? How do you measure success? How do you detect discrepancies or deviations? Those questions go more into the KPI and metrics area. If you ask people if they follow the process, everyone will answer yes. So better ask for data showing what is really happening.

Hence, evaluating how each procedure is implemented, identifying areas of improvement, and revisiting existing processes can help identify any quality gaps in this area.

Company promise and follow-through

Companies must always strive for excellence when it comes to making promises as well as delivering on them; otherwise, there may exist some risks which could damage your reputation and business significantly. And this has two aspects of course, towards customers and employees.

If you promise a customer to provide a certain product or feature at a certain date, you better make sure to keep that promise. If you advertise your products to be the best in class, you better are that good. If a customer feels cheated or fooled, how loyal will he be to your products? Key again here, is customer communication and customer relationship. You want to know if a customer is unhappy. Most customers leave silently, but the better your relationship, the higher the probability the customer gives you a chance to correct your mistake. But actually, you don’t want to be in that correcting spot in the first place. So better be careful what you promise, or have the processes and systems in place, so that you can keep your promises to your customers, no matter what.

And the second aspect, similarly important is to keep your promises towards your employees. Happy employees are loyal, bring in ideas, and regularly go the extra mile. Unhappy employees simply leave, taking with them all their knowledge and skills, or even worse do only what they are asked for reluctantly or sabotage. You don’t want that.

Keeping track of customer interactions, monitoring delivery timelines, and ensuring consistency across different departments – all these steps can help to identify any potential gap.

GAP Framework Summary

The GAP framework provides a simple and comprehensive approach to identifying and addressing potential quality gaps in businesses. Choose your battles and target the issues first, where you can expect the highest gain when correcting those issues.

Hence if you haven’t answered the question yet, now would be a good time:

Is there a gap between how you manage quality and how you should be managing quality?

I recently found a post from Cliff Hazell about “Flight Levels”. it is a thinking model to understand better which opportunities have the most leverage. It helps to answer questions like:

• Where to focus? Out of a variety of visible options
• Whom to involve? You don’t want to involve everyone every time.
• How to connect to the broader organization?

The model describes three flight levels:

• Flight Level 3 – strategic level
• Flight Level 2 – coordination level
• Flight Level 1 – operational level

How does this map to your organization? Levels 1 and 3 are normally easy to identify. The operational level is usually the teams, the people doing the actual work, e.g., a development or a marketing team. Level 3 is often the higher management or separate strategy teams. And what’s Level 2 then? Quite often everything in between, let’s call it middle management. This can be department managers or project managers, product managers, product owners, etc. Their job is among other things to translate the strategy coming from Level 3 into digestible chunks for Level 1.

Here I do not want to go deeper into that model, but I want to mention a challenge that becomes quite visible with that model.

And this is a challenge for many organizations, at least all organizations I have seen, which have a particular hierarchy. What does the reality in many companies look like? Level 3 puts immense pressure on Level 2 to deliver. Level 1 on the other hand doesn’t understand the decisions made on Level 3 and challenges Level 2 on that. That’s a war on two fronts for Level 2 and not every manager on Level 2 is able to deal with both fronts and the result is the high burn-out rate we see in mid-management.

But what to do about it? Here are a few things to consider:

1. Enable Level 2 to understand and communicate the strategy. Don’t just give them a 100-slide strategy presentation in an all-managers meeting. Fire and forget won’t work most of the time. Rather pick up the concerns of Level 2, listen to those people, and help them to understand the strategy in every detail.
2. Keep your strategy short and easy. It should align with your company’s values, vision, and mission. If you don’t have a vision and mission or values, it would be time to think about that. If you have those, but they are too complex, you will lose important aspects when communicating through the hierarchy. Have you ever played “Chinese Whispers”?
3. Train Level 2 in management topics. Don’t promote people to Level 2 and let them figure out alone how to do that job. Enable them, give them training and mentoring.
4. Establish an open communication culture. If you are shooting the messenger of bad news, people will stop giving you bad news. But the bad news is still there, you just don’t know it now. But you want to know bad news as early as possible to get a chance to react. Hence don’t establish a culture of fear.

In conclusion, the Flight Level model is a useful tool to understand which opportunities have the most leverage and where to focus. It’s important for organizations to enable their middle management level (Level 2) with knowledge of strategy and training in management topics so they can communicate effectively between Levels 1 and 3. Establishing an open communication culture will help ensure that bad news gets communicated early on, giving companies time to react accordingly. By applying these principles, businesses can better manage their cross-level communication and increase efficiency across all teams.

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Recently I stumbled across the following quote: “The most invisible form of wasted time is doing a good job on an unimportant task.” And thinking about it, I do this quite often, spending time on unimportant tasks. What a waste of time, but why? Well, for one there are certain tasks I simply like to do, it’s fun doing them. Once in such a task, it’s hard to realize that the task might not be that important and actually I should stop doing that. Those tasks are usually in the less important 80% of the Pareto principle. And second, there are tasks where I simply didn’t spend enough time to identify or determine the importance and I’ll find out too late, that these tasks haven’t been that important at all. I am often too busy to push the cart with the flat tire to fix the tire.

So, what can be done about that?

1. Set Priorities: Before starting any task, take a few minutes to think about its importance in the grand scheme of things. If it’s not an important task or not worth your time, move on to other tasks that are more important and beneficial to you.

2. Make a To-Do List: Allocate a time slot and priority for each task on your to-do list. This way, you can prioritize tasks important to you and quickly identify which tasks are not worth your attention.

3. Take Breaks: When working for long hours, it’s easy to get caught up in unimportant tasks. Taking breaks helps reset the mind and refocus on important tasks.

4. Delegate Work: If there are tasks that you can delegate to others, then do so. This way, you can focus more on the important tasks and not get bogged down by unimportant ones.

5. Automate: Use automation tools for repetitive tasks like data entry or other time-consuming tasks. This will free up more time for important tasks and eliminate the possibility of getting sucked into unimportant ones.

The quote highlighted an issue many experience – doing a good job on unimportant tasks. Setting priorities, making to-do lists, taking breaks, delegating work, and automating wherever possible can help ensure that you’re spending your time on important tasks and not wasting it on unimportant ones.

Ultimately, this quote serves as a reminder to be mindful of how we use our time and to focus our attention on the most important tasks first. It’s an investment in ourselves and our future. So, let’s make sure that we don’t waste our time, since time is our most important asset. There will be always ways to get money, wealth, attention, and even health up to a certain degree. But when time is gone, it’s gone. There is no way to get it back.

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