Answer the following statements true (T) or false (F)

Question

1. Efficiency and effectiveness are terms used interchangeably and equivalently in management. 
2. Automated telephone systems are typically both very effective and very efficient. 
3. An effective manager has a multiplier effect on the organization, meaning his or her influence is multiplied beyond the results achievable by just one person. 
4. John Hammergren's compensation of $145 million in 2010 as CEO of health care technology firm McKesson is typical for CEOs in North America today. 

Answer 1

1. FALSE
To be efficient means to use resources like people, money, and raw materials wisely and cost effectively. To be effective means to achieve results, to make the right decisions, and to successfully carry them out so they achieve the organization's goals.
2. FALSE
We're accustomed to having our calls to companies for information and customer support answered not by people but by automated answering systems. This arrangement is efficient for the companies, since they no longer need as many employees to answer the phones. But it's not effective if it leaves us, the customers, fuming and less inclined to continue doing business.
3. TRUE
In being a manager you have a multiplier effect: your influence on the organization is multiplied far beyond the results that can be achieved by just one person acting alone.
4. FALSE
The business press frequently reports on the astronomical earnings of top chief executive officers. The top earner was John Hammergren of health care technologies company McKesson, who led the list that year with $145 million. However, this kind of huge payday isn't common. Median compensation for top-ranked CEOs in North America in 2010 was $9 million.