Effectiveness and Efficiency: Principles of Management Analysis Report

This report delves into the critical concepts of organizational effectiveness and efficiency. It highlights the importance of doing the 'right things' (effectiveness) and doing things 'right' (efficiency) for organizational success. The report outlines strategies to enhance both aspects, including stakeholder analysis, need analysis, setting clear goals, improving quality, and utilizing technology. It also covers strategies for efficiency, such as wise recruiting, effective leadership, transparent communication, and 360-degree feedback mechanisms. The report emphasizes the significance of these principles in ensuring long-term organizational sustainability. Furthermore, the report cites various academic sources to support its findings.

Principles of management
Effectiveness and efficiency

Introduction: Effectiveness and efficiency
Efficiency and effectiveness play a pivotal role in the success of any organization. Effectiveness
of business processes leads to enhanced growth and improved operations. It is important to
understand the difference between efficiency and effectiveness in order to be able to achieve
organizational goals. Effectiveness means doing the right things and being efficient means doing
things in the right manner (Mathews, 2015). Both of these are important for the success of any
organization.
Being effectiveness means achieving the best result with the least use of resources. These
resources include time, money, manpower or machinery. Off late, organizations have been
focusing on making themselves efficient and effective. This report throws light on how
businesses can achieve efficiency and effectiveness. There are various strategies that can be
adopted by businesses for the same purpose.
Strategies to become effective:
Effectiveness of an organization is reflected by doing the right things using minimum resources.
Strategies to become effective are as below:
Stakeholder analysis
The very first step in ensuring organizational effectiveness is conducting a stakeholder analysis
for the business (Eskerod & Jepsen, 2016). This results in identifying all the important
stakeholders of the organization and hence efforts can be made to ensure their satisfaction
through business activities. Employees can be identified through effective talent management,
customers can be identified by the process of segmentation and targeting and suppliers can be
identified through effective cost benefit analysis.
Need analysis
The first step for any business in order to be effective is to analyze the needs of all the
stakeholders and work towards fulfilling the same. Understanding consumer needs helps
businesses to offer products and services that are in demand (Camilleri, 2018). Understanding

employee needs helps organizations in managing human resources in an effective manner.
Lastly, understanding the needs of other stakeholders like media personnel, suppliers and
government bodies helps in smooth functioning of the business.
Clear Goals
In order to achieve top notch effectiveness, it is important that organizations have clear goals.
Clarity of goals leads to honest functioning of the business. When people working in the
organization have clear goals then they will deliver better performances leading to increased
effectiveness of the firm. Unclear goals lead to directionless performances from employees.
Improve quality
Improving quality of product and service offered by businesses leads to increased effectiveness
of the business. This is because improved quality leads to increased demand, satisfied consumers
and in turn increased revenues for the firm. Efforts to improve the product or service quality
must ensure that the resources are also effectively utilized.
Use technology
Using technology in a productive manner helps organizations in increasing their effectiveness
(Haynes, 2017). Technology assists in sharing information, getting customer feedback and
improving communication within the business as well as communication with stakeholders
outside the business. Technology also improves business processes and eradicates chances of
human error in business operations.
Strategies to become efficient:
Efficiency of the organization is reflected by doing things in the right manner. Strategies that can
be adopted by organizations to stay on the right path are as below:
Recruiting wisely
In order to make sure that organizations are efficient and business processes are conducted in the
right manner, it is imperative that organizations recruit employees through an effective process

(Taylor, 2014). It is crucial to recruit people for the business who relate with organizational
culture and possess the right competency and skills to fulfill organizational goals. Recruiting is
an essential aspect of managing human resources in a business and plays a pivotal role in
maintaining and enhancing organizational efficiency.
Leadership
Leadership in the business is important to make sure that the employees of the business are on
the right track. Leaders in the organization are bestowed upon with the responsibility of leading
and guiding other members of the organization. Therefore in order to ensure that the
organizational efficiency is maintained, the leadership of the business must be efficient enough
for the same. Leaders of organization are also responsible to ensure effective use of resources,
motivating organizational employees and establishing the right working environment for the
employees (Goleman, 2017). Competency in achieving the same leads to improved efficiency of
the firm.
Transparent Communication
Transparent communication in any business helps in building and maintaining an environment
which is positive and motivating. A positive work culture motivates employees to work hard and
enhances their sense of ownership for the business (Karanges, Johnston, Beatson & Lings, 2015).
Transparent communication also leads to quick decision making which further enhances the
organizational efficiency. Various organizations are adopting an open door policy wherein the
senior management of the business leaves their doors open to depict that they are always
available to communicate with the employees. This encourages employees to address their
grievances and communicate transparently.
360 degree feedback
A 360 degree feedback mechanism ensures that every employee of the business is given a
feedback from his or her seniors, peers as well as juniors (Nowack, 2015). This feedback
mechanism enhances organization efficiency by improving employee performance and ensuring
transparent communication. Such a feedback mechanism also helps employees in their learning
and assists in their growth within the business. Another advantage of a 360 degree feedback

system is that it creates a positive environment within the organization and helps employees in
receiving a genuine feedback about their performance.
Conclusion
Organizational effectiveness and efficiency are goals that organizations aim to achieve on a
regular basis. Doing the right things in the business or organizational effectiveness can be
achieved by establishing clear goals, identifying stakeholders in the early stages of business,
analyzing stakeholder needs in a competent manner and working on improving the overall
quality of the product or service offered by the business. On the other hand making sure that
things are done rightly or enhancing organizational efficiency requires the business to recruit the
best available talent in the industry, manage that talent in an efficient manner and lead these
human resources towards organizational goals. Moreover organizational efficiency depends on
establishing a positive workplace environment through transparent communication and feedback
within the business. Both these aspects are crucial to the success of any business and help in
ensuring long term sustainability of the organization.

References
Camilleri, M. A. (2018). Understanding Customer Needs and Wants. In Travel Marketing,
Tourism Economics and the Airline Product (pp. 29-50). Springer, Cham.
Eskerod, P., & Jepsen, A. L. (2016). Project stakeholder management. Routledge. United States.
Goleman, D. (2017). Leadership That Gets Results (Harvard Business Review Classics). Harvard
Business Press.
Haynes, S. (2017). Guide to wellbeing technology in the workplace. Occupational Health &
Wellbeing, 69(9), 12.
Karanges, E., Johnston, K., Beatson, A., & Lings, I. (2015). The influence of internal
communication on employee engagement: A pilot study. Public Relations Review, 41(1),
129-131.
Matthews, J. R. (2015). Assessing organizational effectiveness: the role of performance
measures. The Library Quarterly.
Nowack, K. M. (2015). 360 feedback: From insight to improvement. Public Manager, 44(2), 20.
Taylor, S. (2014). Recruitment and selection. Strategic Human Resource Management: An
International Perspective, 10(6), 139-14.