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Operational efficiency is the output a business from each unit of input. The following are common examples.Revenue Per EmployeeA basic business input is the labor of employees. The productivity of labor can measured by revenue per employee. For example, a train manufacturer with revenue of $5 million per employee is generally more operationally efficient than a competitor with revenue of $2 million per employee.
Line EfficiencyThe efficiency of a production line might be measured in units per hour.Energy EfficiencyA key consideration in the operations of facilities such as data centers is energy efficiency. In many cases, facilities have the space for more customers but don't have enough power for them. Efficiency can be improved by installing energy efficient computing equipment and cooling systems. It can be measured using metrics such as revenue per kwh.
Process Efficiency Processes are the repeated cycles of business activity that can be optimized using techniques such as automation. For example, an ecommerce company might view operational efficiency in terms of the order provisioning costs of its order-to-cash process.Marketing EfficiencyMarketing efficiency such as customer acquisition cost.
Asset EfficiencyThe efficiency of capital assets such as the occupancy rate of a hotel.Equipment EfficiencyThe efficiency of equipment such as an high speed train that is highly reliable and reasonably energy efficiency.
Operations Management
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