Final answer:
Efficiency and effectiveness in organizations are closely related, with efficiency being about avoiding waste and using minimal resources for maximum output, while effectiveness is about achieving objectives.
Step-by-step explanation:
The relationship between efficiency and effectiveness is key to organizational success. Efficiency in an economic sense is the lack of waste, where an organization uses the least amount of inputs to produce the greatest amount of outputs. This is represented by a machine operating at lower cost, not wasting energy or materials. Effectiveness, on the other hand, is about achieving the desired outcome or goal. An organization that is both efficient and effective meets its objectives while using resources sparingly, on time, and within budget.
Examples of organizations that are generally perceived as efficient and effective include technology giants like Apple and Amazon. These companies continually refine their operations, supply chains, and customer service to deliver what is needed efficiently. Conversely, organizations with long delays and high operating costs, for instance, certain bureaucratic institutions or struggling companies, may be seen as inefficient and possibly ineffective if they fail to meet their goals.
Nonetheless, the demand and supply diagram in economics shows that efficiency can occur when no one can be made better off without making someone else worse off. This concept of economic efficiency is critical because it suggests that in an ideal situation, resources are allotted in a way that maximizes the benefit for all involved without additional costs.