A-Z Popular Blog Efficiency Search »

6 Examples of Management Efficiency

 , updated on
Management efficiency is the output a management team creates relative to the capital they direct and expenses they expend. The following are common examples.

Allocative Efficiency

Allocative efficiency is the deployment of resources to create value. A failed strategy, project or product can dramatically reduce the efficiency of an organization by dedicating capital and spending to activities that create no value.

Return On Capital

The operating income earned by a firm relative to capital employed. For example, a small restaurant with $40,000 in capital that produces $400,000 in operating income is extremely capital efficient. Managers are responsible for using capital efficiently including cash, land, facilities, machines and technology.


The output in an hour worked for employees under a management team. Productivity rates vary greatly by industry. For example, a bank that deploys a great deal of capital per employee should be more productive than an company that uses little capital such as a restaurant.

Resource Efficiency

Resource efficiency is the use of resources such as energy, water, land, materials and parts without waste. For example, a farm that is managed to use less water per acre without sacrificing yield.

Process Efficiency

The amount of time, labor and expenses consumed by a process relative to its outputs. For example, an ecommerce company that is managed to have the lowest shipping costs and the fastest order turnaround time in the industry.

Cost Efficiency

The cost of business goals and outputs. For example, customer acquisition cost is a measurement of marketing efficiency and cost per unit is a measurement of production efficiency.


Management efficiency is calculated with the efficiency formula using definitions of output and input that are relevant to an industry, organization or team.
Overview: Management Efficiency
The output a management team creates relative to the capital they direct and expenses they expend.
Related Concepts


This is the complete list of articles we have written about efficiency.
Business Efficiency
Division Of Labor
Economic Efficiency
Efficiency Formula
Efficiency Goals
Jevons Paradox
Machine Efficiency
Management Efficiency
More With Less
Operational Efficiency
Process Efficiency
Resource Efficiency
Specialization Of Labor
Technical Efficiency
Time Efficiency
Value Creation
More ...
If you enjoyed this page, please consider bookmarking Simplicable.


A list of efficiency measurements.

Business Efficiency

Common types of business efficiency.

Process Efficiency

How to calculate the common types of process efficiency.

Business Benchmarks

The common types of business benchmark.

Red Tape

A definition of red tape with examples.

Work Efficiency

The definition of work efficiency with examples.

Efficiency Definition

An overview of efficiency with examples.

Economic Efficiency

The common types of economic efficiency.

Agency Cost

The definition of agency cost with examples.

Operational Efficiency

A definition of operational efficiency with examples.

Revenue Per Employee

An overview of revenue per employee including how it is calculated and used.

Technical Efficiency

An overview of technical efficiency with an example.

Cycle Time vs Takt Time

The difference between cycle time and takt time with an example.


A definition of throughput with examples.

Time Efficiency

An overview of time efficiency with examples.

Operational Analysis

An overview of operational analysis with examples.
The most popular articles on Simplicable in the past day.

New Articles

Recent posts or updates on Simplicable.
Site Map