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Efficiency vs Quality

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Efficiency is the output you get for a unit of input. Quality is the value of products and services to customers. Efficiency and quality are a common business tradeoff as it is often possible to make short term gains in efficiency by cutting quality. Alternatively, efficiency such as speedy service may be viewed as a quality improvement. The following are illustrative examples of efficiency improvements that impact quality.

Customer Service

A call center evaluates employee performance using call handle time. This results in declining customer satisfaction as calls are rushed or issues closed without a reasonable resolution.


A dominant brewery decreases cost per unit by using similar commodity ingredients in all its products. This leaves the firm open to competition from craft breweries that tap demand for premium products with unique ingredients and taste.

Customer Experience

A luxury hotel chain carefully measures and optimizes the average cost per square foot to furnish a unit. This encourages the firm's interior designers to cut costs on furnishings each year to show year-over-year efficiency improvements. With time, customer experience begins to suffer. A competitor comes along that spends twice as much on interiors and gains far better customer ratings and pricing power in key markets.

Parts & Materials

A washing machine manufacturer pushes suppliers to cut costs on a regular basis for parts. This leads suppliers to replace metal parts with plastic resulting in declining durability and reliability.

Operational Efficiency (1)

An airline seeking to reduce operational costs eliminates meal services and free snacks on flights. They also stop accepting cash on flights to reduce costs associated with handling cash. This results in customer service issues, such as young people who don't have a credit card having no access to food on flights.

Operational Efficiency (2)

A delivery service has systems, equipment and processes in place that result in lower average delivery time for packages relative to the competition. They regularly introduce improvements that both cut cost and improve delivery times thereby improving both efficiency and quality.

Energy Efficiency

Energy efficiency typically improves quality. For example, all other things being equal a solar panel with conversion efficiency of 22% may be viewed as higher quality than a solar panel with efficiency of 14%.

Labor Productivity

A design firm with high employee engagement benefits from superior levels of labor productivity that translates to superior quality as employees are creative and diligent.
Efficiency vs Quality
Expenses as a percentage of revenue.
The value of product and services to customers.


This is the complete list of articles we have written about quality.
Conformance Quality
Cost Of Poor Quality
Credence Quality
Critical To Customer
Critical To Quality
Customer Satisfaction
Data Quality
Defect Density
Defect Rate
Defensive Design
Design Quality
Document Quality
Ease Of Use
Experience Quality
Figure Of Merit
Fit For Purpose
Information Quality
Non-Functional Testing
Operational Testing
Perceived Value
Planned Obsolescence
Product Quality
Quality Assurance
Quality Control
Quality Culture
Quality Examples
Quality Improvement
Quality Management
Quality Metrics
Quality Objectives
Quality Of Life
Quality Policy
Quality Requirements
Quality Testing
Recovery Paradox
Regression Testing
Reliability Engineering
Service Quality
Types of Quality
Acceptance Testing
Work Quality
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Types of Quality

A list of quality types.

Quality vs Value

The subtle difference between quality and value.

Quality Metrics

The common types of quality metrics.

Service Quality

The primary types of service quality.

Experience Quality

The common types of experience quality.

Critical To Customer

A definition of critical to customer with examples.

Design Life

An overview of design life with examples.

Planned Obsolescence

The common types of planned obsolescence.

Quality Objectives

The definition of quality objectives with examples.

Credence Quality

A definition of credence quality.


A list of efficiency measurements.

Efficiency Examples

A definition of efficiency with examples.

Efficiency Formula

How to calculate efficiency with examples.

Efficiency vs Productivity

The difference between efficiency and productivity.

Operational Efficiency

A definition of operational efficiency with examples.


A definition of throughput with examples.

Machine Efficiency

How to calculate machine efficiency with examples.


The common types of inefficiency.
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