APT Initiatives
APT Business & Economics Resources
Minimising Workloads, Maximising Performance
Established in 1999

Special Items


The relationship between inputs used and output achieved. It is all about minimising waste in terms of resources, including time. It involves: keeping down the level of waste in production; keeping down the time it takes to produce a product / provide a service; making full use of resources; securing increased output of each unit of input. It can be measured in terms of unit (or average) costs. This is calculated by dividing the total cost (fixed + variable) involved in producing a product (or providing a service) by the number of units produced (or customers served). If one firm produces goods at a lower cost than a rival firm produces goods of the same type and quality, then we say that the first firm is more efficient. This is expressing it in monetary terms but – as suggested above – it can also be measured in terms of time ie the length of time it takes a business to complete a process, produce a product, or provide a service to customers. The efficiency of a specific input or process can also be measured, eg: Labour: the amount produced per employee; Capital equipment: the amount produced per machine; Production process: the amount of wastage produced. Improvements in efficiency lead to a lower average (unit) cost. Improvements in efficiency in terms of time may also result in products being produced and / or customers being served more quickly than competitors and, thus, also help to achieve objectives relating to sales growth and market share.

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