How to maximise both efficiency and effectiveness at the same time

In his book The 5-STAR Business Network (http://bit.ly/5-STARBN), Vivek Sood talks about prophecies coming from an article written in the Harvard Business Review in 1999. Although this article was written almost 15 years ago, the authors, John Hagel III and Marc Singer, were very forward thinking about companies. In fact, they foresaw organisations would focus so much on core competencies that they would specialise in one particular area of efficiency – customer relationship management, infrastructure and assets management, or competency and innovation management. This is what de facto happened. Companies started to focus on core competencies and this unbundling led them to high specialisation. Some organisations decided to put their money only in innovation and, as a result, they became highly specialised in innovation and new product development, which is good in some points, but reduces their general efficiency. In other words, too much specialisation leads to high effectiveness in the area on which they choose to focus, but it reduces the general efficiency of the organisation. There are also companies that decide to focus on the consumers. Thus, they concentrate their efforts in understanding the consumer’s mind and needs, but it prevents them from improving their products, in terms of innovation, and their infrastructure, in terms of asset management. Therefore, to be efficient and effective at the same time, your company needs the support of its network. In fact, although focusing on core competencies is essential in today’s businesses, it is also essential not to neglect the other areas. This is the role of your network. When talking about these new businesses in his book, Vivek Sood calls them “Super Networked Businesses”. In fact, you can focus on core competencies, as long as you have an appropriate network to back your core competencies’ processes. Then, companies can reach effectiveness and efficiency at the same time by using strategically their business and supply networks. Besides, your IT system can help you reach these objectives in the global business environment. One more time, collaboration with your partners is very important in this perspective. In effect, your business will benefit from synergies provided by the collaborative teamwork within the supply network, and you can go even further to achieve synchronicity. The concept of synchronicity has been developed in a previous article and more information is also available in Vivek Sood’s book. Therefore, through the teamwork of companies’ networks, a process of re-bundling has been appearing since the 00s and 10s. These companies are building super networked businesses, and collaboration enables to be efficient and effective, putting customer, innovation and infrastructure areas back together. Today’s technologies and methodologies can help you build super networked businesses, especially using teamwork. In fact, all the areas within a company must be aligned with the same strategy and on the same features. This is the reason why collaboration is important within the network, as well as within the organisation itself. This is the key for the success. Consequently, in this article, I would say the key word is “teamwork”. This word reveals the importance of collaboration to build super networked business, which will be effective and efficient at the same time, in today’s globalised business world.

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  • cendrilla says:

    As from my point of view “Efficiency is doing things right Effectiveness is doing the right things.”

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