April 22, 2005
Effectiveness Versus Efficiency
What is the difference between effectiveness and efficiency? Which is more important for your law firm?
Effectiveness is all about doing the right things. It takes leadership, vision and insightfulness, selecting the right location, the right practice areas, the right clients, hiring the right people, etc.
Efficiency is all about how you do things, i.e., doing them well at a lower cost, etc. Unfortunately, you can be very efficient at the wrong things.
While effectiveness is the more important, it takes both effectiveness and efficiency to achieve the long-term objectives of profitability and survivability. Pick the wrong practice areas for your particular firm, for example, and no matter how efficient you are, that wrong choice is likely to limit long-term success. Pick the right areas and you still have to be efficient to prosper and achieve your income objectives. Effectiveness (doing the right things) gives you the opportunity for success. While pure luck can accidentally put some of us in the right place at the right time, strategic thinking and structured planning are the essentials most of us require for the inspired insight and vision needed by the effective leader. Vision alone doesn’t guarantee success. Your team will also need the information system and tools necessary to pursue that vision efficiently.
When investing in business and information systems, look at what the investment will earn for you, not just the investment dollars required. If you look at just cost, you would probably never hire another attorney. Why would you look at just cost when making an investment that has more influence on partner income and long-term success than any single addition to your roster?
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Filed under Management by Tom Collins