Efficiency vs Effectiveness
Efficiency vs Effectiveness
This past week I spend 3 days at my 4th Annual Jornaya Kickoff in Atlantic City. Every year the company gets together to celebrate victories, reflect and learn from failures, bond as a team, and get aligned as a company on the goals for the new year. Its always good fun, and this was our first year in Atlantic City for it and it turned out to be one of the best I have attended.
One the first night there, we did the annual CEO Awards ceremony, recognizing individuals who really made a difference in the organization over 2019. For the first time in my tenure at Jornaya, I won a CEO award for “Rising Star”. It was an honor and I was really excited about it. However in the days following and reflecting on the year a few things came up for me.
The biggest thing that came up for me was “Why Now?”. I felt like this year didn’t represent my most productive year, or that I particularly did more work or worked any harder this year. In fact, I took over 6 weeks of vacation this year, and debatably wrote less code this year than in previous. The projects I delivered were not as technically impressive and due to a smaller team, we delivered less of them. Normally the “Rising Star” award goes to someone in Sales or Support (which statistically makes sense given the relative size of engineering to those departments).
In reflection, my answer came the next day during one of our alignment sessions. We broke up as teams and tried to align to one of our corporate objectives for the year. My team happened to be the Revenue goals, and also happened to include our CEO. While brainstorming on how to make the revenue goal approachable to the entire company and not just the Revenue Org (Sales, Success, and Marketing), we came up with the keystone to growth is Customer Value. So to make the company’s growth personally ownable for each employee, make sure that any given employee keeps an eye on delivering the maximum customer value as their guiding north star.
Focusing on customer value not only frames thing in a way that everyone can relate to, it helps justify what work we are not going to do or how to prioritize work. The budding economist in me loves the “maximize utility” vibe that framing has, and how “maximizing the utility (customer value) for as many customers” drives business growth.
The group discussed the core difference between Efficiency and Effectiveness. People being more Efficient means they can get more work done in less time. However focusing on employee efficiency can seem a bit punitive and micro-managing; and ultimately it doesn’t necessarily mean the best thing for the company. Being more Effective means delivering more customer value in less time. This is directly tied to company value. Think of it as “Work Smarter not Harder” where smarter means with a focus on delivering the maximum customer value. All employees being more effective would mean faster growth with less investment, and it doesnt necessarily mean working yourself to the bone or trying to optimize every hour of your day. Instead it is communicating with the team to make sure the things that are needing to be prioritized are, and it means that everyone on the team has to have the customer value being delivered at the top of mind. This way an employee can push back on their manager if they think there are more effective ways of getting things done. Another way of thinking about it is, you can work hard and deliver 10 units of work in a week, but if they are not the correct 10 units, you are probably better off delivering 2 units of work that are the right ones.
Coming back to the “Rising Star” award; looking back of the past year, I may not have been more efficient in work compared to previous years, however the more transparent Engineering Leadership team allowed me a lot more ownership of the delivery of customer value this past year. The fewer projects I took on were ones that I could see the value I was helping deliver, and consequently I was able to make changes in the “How” the work was done to deliver more customer value in less time and work. Previous Engineering Management regimes would try to take care of all of the prioritization to “not bother the engineers”, but the lack of transparency let to a lack of ownership and the ability to see beyond the horse blinders. So while I absolutely has much more ownership and influence in the Engineering process this year, I was able to use that to drive more customer value despite likely outputting less work; but ultimately that was better for the company and that is why it got noticed.
This insight into Efficiency vs Effectiveness is probably the best argument I have seen for flatter organizations and maximizing transparency. The less levels of management and opinion ideas have to go through, the more ownership individuals can have and the more they can drive meaningful change and help maximize the growth of a company.