Effectiveness – the missing core in business administration

Effectiveness is the key to success in all types of organized activities and can be described as the missing link in business administration. An important issue for managers in leading positions within business, industry and public office is therefore: “How can you make your organization more effective?” The answer requires both knowledge and awareness of the essence of effectiveness:

Effectiveness consists of two contradictory concepts – customer value and efficiency (productivity). All organized activity aims at creating value that is higher than the cost of production. Being effective in creating value does not necessarily mean that you have high productivity (efficiency). In consumer businesses value exists in the eyes of the beholders. In business to business relationship value can often be calculated. Effectiveness constitutes a core analytical tool in all types of organizational diagnosis.