Monday, September 15, 2014

Efficiency vs. Excellence

We've all been discussing efficiency lately, thanks largely to the release of the GEMS report on educational efficiency, and while there's one critical point that has appeared tangentially in much of the discussion (including the original GEMS paper), I think it's worth pulling it out and looking at it by itself.

Efficiency and excellence are not the same thing.

In fact, excellence and efficiency generally cannot go together (unless you are the kind of person who defines excellence as efficiency).

Here's another way to understand efficiency. The point of highest efficiency in any business is a point that meets the following two requirements:

1) If we create higher quality, it will require a greater proportional dedication of resources.

2) If we devote fewer resources, it will result in a proportionally greater drop in quality.

Efficiency is the not the best possible result we can achieve, But to get a little bit closer to Best Possible Result would require a whole lot of time and money.

In the business world, this is somewhat related to our old favorite, Return On Investment. This is where I could make the product better, but I would be spending an additional $10 on the product and getting only $10 or less value out of it. This is when you're going to sell your house and you realize that it would cost you another $1,000 to fix the bathroom, but fixing the bathroom would probably only get you another $500 on the selling price.

Past a certain point, it lowers efficiency in your operation to improve the quality of your product. This is how car companies end up saying, "We could fix that flawed feature, but it would cost us $10 a unit and we couldn't charge more for it. So let's not fix it."

The pursuit of excellence and the pursuit of efficiency are two different things. Top ivy prep schools, like the Philps' academies, are grossly inefficient. Philips Exeter seats students at Harkness tables, limiting class size to twelve, which is grossly inefficient. Faculty could handle classes of double the size with no notable drop in quality.

Well, maybe they could. The thing about quality is that it's perception. Efficiency can go hand in hand with marketing. If we drop resources by a quantity of X, quality will drop by Y-- but can we get the customers to think that the new normal is just as good as the old one? In schools, can we convince people that a class of three hundred taught by one teacher on the other end of a computer link-up is just as good as one teacher in a room with only twelve students?

The pursuit of excellence is expensive-- usually prohibitively so. But if we use efficiency as our guiding star, we will be led inexorably to the Land Of Just Good Enough, a place that almost nobody wants to send their children to. It does make sense to discuss efficiency in education-- how to make the best use of finite resources. It does not make sense to make efficiency our goal, certainly not to make it our very definition of excellence. McDonalds is efficient. But nobody goes there strictly for excellence.

1 comment:

  1. In the 1970's it was more efficient for Ford to pay out of court settlements to the families of those killed due to the Pinto's faulty gas tank than have to retool the assembly line. Sometimes efficiency comes at a terrible price.