Sham works as a production manager in As Limited. He has been given the task of getting 1000 units of hand woven table mats manufactured at the cost of Rs 150 per unit within 10 days. In order to be acknowledged as an effective manager, he must ensure that
Answer & explanation
Correct answer: option 2
The concept of effectiveness is related to the completion of the task within the stipulated time irrespective of the cost involved. Efficiency on the other hand means doing the task correctly and with minimum cost. There is a kind of cost-benefit analysis involved and the relationship between inputs and outputs. If by using less resources (i.e., the inputs) more benefits are derived (i.e., the outputs) then efficiency has increased. Efficiency is also increased when for the same benefit or outputs, fewer resources are used and less costs are incurred. Input resources are money, materials, equipment and persons required to do a particular task.