effective mngt

In management, effectiveness is concerned with increasing the total out put, while efficiency is concerned with reducing the inputs required for achieving a given level of output. In many situations the effectiveness and efficiency go together. A company that makes high level of profits is also likely to have low unit cost per unit of production. But there can also be situations where increase in effectiveness may result in reduced efficiency. Some example such situations are given below.

* At times higher total production may be possible by giving overtime, to workmen, which involves higher rates of wages. This may increase unit cost of production, still profits may be higher because increase in cost is more than made up by increase in total revenue.
* Unit labour cost may also increase for higher production for other reasons such as payment of incentive for higher production and use of contract labour.
* All project manager face situations where faster completion of a pproject can be achieved at higher costs, an managers often choose to incur higher costs as earlier production means higher effectiveness in terms of starting to receive benefit of the completed project output earlier.
* In some project the completion deadline may be very important - for example, organizing an international sporting event. In a situation like this, it is important to ensure that all preparations are made in time, even if it is possible at substantial extra costs.