Questions Personal and Family

How is effeciency different from productivity?


Elizabeth T Flanagan

Love without limits

With the increase in the competition and costs of production, there is a need to gain a competitive edge to stand above the crowd. And as many companies in the unbeaten run have ensured, you need to improve the efficiency and productivity of your business to be at the top. However, many get both these concepts confused and think that productivity and efficiency are inevitably the same, which is not the case. Let us take a more in-depth look into what each means and how they are different.

What is efficiency?

You can say that this is a measurement of the quality of the output, rather than on the number of productions. It is about the ability to make a maximum with minimum resources and even lesser wastage. This is more of an internal measurement for the businesses to gauge how productive they can be and how better their performance has been. This is often denoted in percentages, with 100% being the maximum and most ideal to achieve.

What is productivity?

Unlike efficiency that focuses on the quality of output, this is more on the quantity of the product produced. For instance in a manufacturing unit, if the product is currently at 50 units a day and it is improved to 75 units a day, then it is called enhanced productivity of 25 units. This is a measurement that is only upon the number of output and does not focus on the cost or resources input and neither on the quality of the production.

Productivity vs. Efficiency

While it is possible to have better productivity with enhanced efficiency, you cannot hope for an efficient outcome with increased productivity. Here are a few differences that clearly distinguish between these two concepts.

  • Productivity is about the number of goods produced using a specific input while efficiency deals with ensuring limited resources and limited wastage in producing single quality output.
  • The productivity by concept deals with the number of goods, the quantity of production while efficiency deals with the quality of the output.

It is everyone’s ambition to be the most productive without losing out on efficiency. However, you need to decide based on the task, whether you need to place more emphasis on effectiveness or productivity. You need both at the right proportions to make a profitable output. While it might be tough to balance efficiency and productivity, once you adjust you will find that all tasks are easier to handle and success is more comfortable to reach.

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