Effectiveness vs Efficiency in Project Management

If you want more profitable projects, both effectiveness and efficiency must be top of mind. The same goes for churning out consistently amazing deliverables and keeping clients coming back for more.

The thing is, effectiveness and efficiency are not the same thing, especially where project management is concerned. They promote different outcomes, and if they’re both leveraged successfully, the processes behind achieving each will look different from one another.

Here we’ll explore the difference between effectiveness and efficiency in project management and why it matters.

What’s the big deal?

Admittedly, most people don’t distinguish between being effective and being efficient. They lump the two concepts together. For example, at large, this research concludes that throughout the project management field, the terms ‘effectiveness’ and ‘efficiency’ are used interchangeably. This includes professionals, writers, and even academics, the majority of whom see no problem with interposing one for the other. After all, if a project is executed efficiently, the techniques and processes used must be effective. Right?

Not exactly. As Nick Fewings points out:

Effectiveness is about accomplishing the right thing, whereas efficiency is about accomplishing something resourcefully. 

Ipso facto, you've managed a project effectively if the deliverables are solid and the customer is delighted. If you’ve managed a project efficiently, this means that time and money have been taken into consideration and that the value of both has been maximized. 

What is effectiveness in project management?

ef·fec·tive·ness

noun

the degree to which something is successful in producing a desired result; success. "the effectiveness of the treatment"

As both Fewings and the IAPM (International Association of Project Managers) point out, effectiveness is about doing the ‘right thing’. This means focusing primarily on the goal of the project and actions to be undertaken to achieve that goal. 

But effectiveness, like efficiency, is ultimately measured at the end of the project lifecycle: an effective project will either meet or succeed in customer expectations.

What is meant by efficiency in project management?

ef·fi·cien·cy

noun

the state or quality of being efficient. "greater energy efficiency"

If effectiveness means doing the right thing– aka delighting the customer– efficiency means doing the right thing the right way. 

The right way involves optimizing time and resources to reach project completion. This can mean spending the least amount of money possible to churn out amazing deliverables. It can also mean completing projects in the least amount of time necessary, without sacrificing quality. 

Whereas effectiveness focuses on the final product and the actions required, efficiency is concerned with optimizing money, time, and resources to get there. 

The key: balance effectiveness and efficiency

While both effectiveness and efficiency are required to excel at project management, they need to be balanced and perceived as what they actually are. For example, you need effectiveness, to do the ‘right thing’, before efficiency can be factored in. All the productivity and billability possible won’t mean anything if the project itself does not have a cohesive vision, plan, and outcome. 

On the flip side, if you solely focus on being effective, you can put the profitability of your projects in jeopardy by spending too much on resources or taking too much time on deliverables. 

By focusing on both effectiveness and efficiency in a balanced way, you can make sure your projects are successful and avoid common pitfalls that cause them to fail, like missed deadlines, customer dissatisfaction, etc. 

Increase effectiveness and efficiency in one go.

Did you know? 

Organizations that do not leverage or have outdated project management technology have a project failure rate of 18% (Project Management Institute).

By simply onboarding project management software designed for your industry and leveraging its features, you can increase your effectiveness and efficiency in one go.

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