Tag Archives: cost cutting

255 – Navigating Efficiency and Effectiveness in Local Government

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520 words (6 minutes reading time) by Tim Whistler

Recently, I have been thinking about the dichotomy between effectiveness and efficiency. It is becoming a focal point in assessing how councils perceive and measure their performance.

Peter Drucker’s insights, encapsulated in “The Effective Executive,” draw a clear distinction between effectiveness and efficiency. Effectiveness, he says, is about selecting the right goals and attaining them, with the emphasis on doing the right things. On the other hand, efficiency revolves around optimising available resources to achieve those goals, with the emphasis on doing things right.

Effectiveness is doing the right things. Efficiency is doing things right.

Peter Drucker
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189 – Essay No. 2 – Local government, effectiveness and efficiency.

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Posted by Lancing Farrell                                                                              3300 words

false economy cartoon

Image

People in local government regularly discuss effectiveness and efficiency. Often this happens in relation to pressure on revenues, such as rate capping. Most of the discussion centres on efficiency rather than effectiveness, and opportunities to stop delivering those services that are seen as ‘cost shifting’ from other government. The efficiency discussion is often not well informed. Frequently it focuses on inputs while ignoring outcomes and public value. Any savings are usually equated with cost cutting, not creating the same value at lower cost.

Australian researcher and writer Christopher Stone has published several papers on ‘false economies’. Each addresses a different aspect of productivity and efficiency in the public sector.

“Everyone has the right to know that money is not being wasted; that it is being spent as efficiently as is possible.” Christopher Stone, Decoding Efficiency, April 2013.

So, what is efficiency and how does it differ from effectiveness? Continue reading →

69 – Local government and milk. What do they have in common?

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Posted by Colin Weatherby                                                                         660 words

cow

I recently drove past a car sign-written with advertising for milk available direct from the farm. It promoted the virtues of buying milk from the producer. I had earlier heard a radio advertisement for milk available from an inner urban Melbourne dairy where I am sure there are no cows. The advertisement talked about local milk from local people.

There may be some difference in the milk each company is selling. And it is probably different from the milk I can buy at my supermarket. So what is happening with milk and why might it tell us something that is relevant to local government? Continue reading →