Process Efficiency is the capability of human resources to carry out a certain process in the way that ensures minimized consumption of effort and energy. In simple words, it is a situation when a process is implemented in the right way. The purpose is to simplify implementation through getting more results with fewer resources used. Process efficiency lets obtain the greatest savings and performance through minimizing waste and optimizing resource consumption.
Measurement of process efficiency is vital to successful project management. There is a common formula to calculate the efficiency of a typical process:
----------------------- x 100%,
- Actual output is the total amount of work the process actually delivers.
- Standard output is determined by looking at historical performance data from the same or similar process.
As it appears from the formula, in order to increase efficiency of business processes an organization needs to focus on enhancing the actual output. It should also analyze current processes against past or completed processes to identify process faults and waste.
There are three aspects a business organization needs to consider when improving the actual output:
- Reduced wait time. A process produces a higher output if the length and number of breaks are minimized.
- Minimized number of human resources involved. A process becomes more efficient and less dependent on the human factor when fewer employees are involved in performing the process.
- Ratio of human-made effect to the total output. Ideally, a process is efficient when human resources have no effect to the process performance and output.