"Most successful men have not achieved their distinction by

having some new talent or opportunity presented to them. They

have developed the opportunity that was at hand."
-- Bruce Barton
I
PPODUCTIOM COST
-
-It is a combined cost of raw materials and labor incurred in
producing goods.
-One of the determinants of supply. Producers have greater
ability and willingness to supply a product which has a lower
cost of production.
The HIGHER COST OF PRODUCTION,
the HIGHER PRICE OF PRODUCTS.

efinition of Efficiency
The simple, often used, definition of
efficiency is doing the thing
right
bsence of waste, or the use of
economic resources that produces
the maximum level of satisfaction
possible with the given inputs and
technology.

efinition of Effectiveness
The simple definition of effectiveness
is doing the right thing
-represents the achievement of maximal
outputs at given sources, which are used by
the realization of given activity. It is a
valuation of relationship between results,
which are formed by the given production
and the inputs that are consumed.

ifference between Efficiency and Effectiveness

The words efficiency and effectiveness are often considered
synonyms, along with terms like competency, productivity, and
proficiency. However, in more formal management discussions,
the words efficiency and effectiveness take on very different
meanings. In the context of process reengineering, Lon
Roberts (1994: 19) defines efficiency as "to the degree of
economy with which the process consumes resources-
especially time and money," while he distinguishes
effectiveness as "how well the process actually accomplishes
its intended purpose, here again from the customer's point of
view."
Being effective means producing powerful effects. Being
efficient means producing results with little wasted
effort. It is the ability to carry out actions quickly. However, by
so doing, you may not be achieving effectiveness.
Effectiveness involves achieving your worthwhile goals that
support your vision and mission.

%ECHNICAL VS ECONOMIC PRO&C%IVI%

efinition of %echnical Productivity
-is concerned with gutting the most physical
product out of predetermined set of physical
inputs, or if the volume of physical output to
be produced is fixed, technical productivity
demands that the least possible amount of
inputs to be used
efinition of Economic Productivity
-is an economic concept which measures the
efficiency of production It takes into account
the money costs of the inputs required for
production

" & A:
1 Are managerial effectiveness and
managerial efficiency related
concepts? If so, how are they related?
2 Why is productivity a term so
important in today's business?
3 oes productivity improvement
leads to reduction in cost of
production? Explain your views