Definition of Efficiency

This time we will discuss the notion of efficiency along with its terms, types, benefits and objectives. Here’s the explanation …

 

Table of contents :

Definition of Efficiency

Terms of Achieving Efficiency

Types and Examples of Efficiency

  1. Optimal efficiency
  2. Efficiency With Benchmarks
  3. Efficiency at Break-Even

Benefits and Efficiency Goals

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Definition of Efficiency

Efficiency is a measure of the success of an activity which is assessed based on the amount of costs / resources used to achieve the desired results.

 

In this case, the fewer resources used to achieve the expected results, the process can be said to be more efficient.

 

An activity can be said to be efficient if there is an improvement in the process, for example, it becomes faster or cheaper.

 

According to the Big Indonesian Dictionary (KBBI), efficiency can be defined as the accuracy of how to do something, and the ability to do tasks correctly and accurately without spending money, time and effort.

 

To better understand what efficiency means, we can refer to the opinions of experts. The following is an understanding of efficiency according to experts:

 

According to Mulyamah (1987; 3)

 

Efficiency is a measure of comparing the plan to use the input with the actual use or in other words, the actual use

 

According to SP Hasibuan (1984; 233-4)

 

Efficiency is the best ratio between input (input) and output (the result between profit and the resources used), and optimal results are achieved with the use of limited resources. In other words, the relationship between what has been done.

 

the notion of efficiency

 

Terms of Achieving Efficiency

Humans always try to make efficiency in various areas of life. For efficiency efforts to be successful, they must meet the following conditions:

 

Effective:  the work unit’s ability to bring results and benefits. For example, goods produced are beneficial to society.

Economical:  is an action to get quality input (goods or services) with the smallest possible level.

Work implementation can be justified

Real division of labor

The rationality of authority and responsibility

Practical work procedures

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Types and Examples of Efficiency

  1. Optimal efficiency

Optimal efficiency is the best comparison between the sacrifices made to get the desired result.

 

In terms of results. For example, a manager can achieve output (productivity, performance) that is higher than the inputs (labor, money, time and materials) used.

In terms of savings . For example, with the use of modern equipment, the work process will be faster and save time and money.

  1. Efficiency With Benchmarks

Efficiency with benchmarks is the ratio between the minimum results determined by the actual results achieved, which can be said to be efficient if the real results are greater than the specified minimum.

 

Example:

 

Indonesian workers can set about 100-125 bricks per day (8 hours)

Thai workers can produce 250 bricks a day (8 hours).

In this case the benchmark is the ability of each construction worker to achieve the specified minimum result within a certain time.

 

  1. Efficiency at Break-Even

Break-even efficiency is often used in the business field where the breakeven point is the boundary point between efficient and inefficient business.

 

A business or a business can be said to be efficient if the break-even point is known and the business earns more than the break-even point.

 

Benefits and Efficiency Goals

Efficiency is often carried out in various fields of human life which of course has a purpose as a reason for efficiency. In general, the efficiency goals are as follows:

 

To achieve the results or goals as expected.

To save the use of resources in carrying out activities.

To maximize the use of all available resources so that nothing is wasted.

To improve work unit performance so that output is maximized.

To maximize the benefits that may be obtained.

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From the above explanation, we know that the purpose of various efficiency efforts is to achieve optimal efficiency.

 

Optimal efficiency is the best comparison between the sacrifices made to get the desired result.

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