Efficiency and Effectiveness – What it is, and what it isn’t.

Richard Mills CEO    General Discussion     busniess, companies, efficiency, Employee Scheduling, Intellicate, job cuts, Schedule24 Workflow Management, scheduled work hours, shift, shift pattern, staff, work, workforce

A 2007 whitepaper about neglected management skills in the workplace, highlighted the lack of coordination, communication and control of staff in businesses operating extended or 24 hours working.  It was written at the height of “boom time” during which team leaders and line supervisors were unwittingly transformed from people to process managers, and management teams continued to pursue the fads and fashion surrounding talent management and 360-deg performance driven reward and retention programs.  However, basic workplace skills continued to be neglected. Three years on and things are somewhat different. The “piranha” is upon us and pundits are extolling “tough times” will be around for a long time to come.

Certainly most of us are aware expectations have been firmly pushed into the ”more demand for efficiencies in the workplace” debate. So what is efficiency? Well on its own nothing much. The ultimate state of efficiency is where no energy is expended. So closing everything down is about as efficient as it can get, but that doesn’t really help. We will however hear about efficiency ad nauseam and it will become synonymous with cost-cutting, which in turn will become welded to job cuts. For business to be both efficient and effective may well involve job cuts, but carrying out job cuts does not make a business efficient and effective. Often businesses continue just as inefficient and ineffective as before – just smaller.

Efficiency can only have meaning when associated with our effectiveness to achieve something – a business or management goal for example. It may be worth bearing in mind you can be effective yet inefficient, and efficient yet ineffective. Efficiency and effectiveness are siblings of reason. You need both.  A much over-used phrase of late is the statement ”We will do whatever it takes”.  A hallmark of someone who has bypassed the faculty of thought if ever there was one.

Efficiency measures the amount of time and cost required to achieve a goal; and effectiveness measures whether that goal has been reached. The best outcome is to achieve a given goal in less time and cost than by alternatives means. The hardest task for the drive for  more efficiency is not reducing cost, that is easy – anybody can do that. Defining goals  and recognizing at what point they have been reached is much harder.

Leaving aside whether goals are defined and agreement when they are reached, another  relationship exists that many will try to bend in the name of efficiency but only succeed to break . The cast-iron relationship forged  between staff-cost, staff-count, and staff-hours is complex and the consequences often underestimated. Without the means to manage all three contexts simultaneously few ever get it right.

Payroll records for work hours is no protection

Richard Mills CEO    Intellicate Solutions, Schedule24 Workflow Management, Shift Patterns, Workforce Factors     companies, EECWTD, Employee Scheduling, European Economic Community Working Time Directive, Intellicate, payroll records, scheduled work hours

A UK company was fined £54k (including £24k costs) for health and safety breaches which directly contributed to the death of an employee in a road traffic collision. Briefly the facts leading up to the fatal sequence of events included the driver working 11 days without a break, and three days before the accident had recorded 19 hours a day. Evidence was presented to show this was not an isolated incident and involved other employees.

Opting out of legislation e.g. European Economic Community Working Time Directive (EECWTD) does not mean you opt out of health and safety issues or duty to exercise care. This catches a lot of employers out. Recording working hours for payroll is a post event process for accounting. It has nothing to contribute toward exercising a duty of care. In short a company that wishes to discharge a duty of care has to demonstrate working hours are planned and scheduled not simply recorded. Scheduled work hours can be used for payroll, but not the other way round.

The irony is companies who say they use payroll records for working hours management when things go wrong probably don’t realise these records are the first port of call for the prosecutor not the defence.