Published:Jul 20, 2021

Productivity vs Efficiency: Why Developers Need to Know the Difference

We all want to be more productive.

But is productivity all we need to create high-quality software products? What about efficiency? Is being productive the same as being efficient? What does efficiency measure that productivity doesn’t? And how exactly can you define the right metrics to make meaningful improvements?

To make targeted improvement to your development process, you need to first clearly define these terms and understand how to apply them appropriately.

Why Should You Measure Productivity And Efficiency?

Software development is a human-intensive process. Much of its success hinges upon the developers’ productivity and efficiency.

Measuring the right metrics helps you gauge performance and identify red flags early, so you can maintain high productivity and efficiency to develop products that deliver the expected functionalities while staying on time and on budget.

Productivity vs. Efficiency: What’s the Difference?

It’s not uncommon for people to use the terms “productivity” and “efficiency” interchangeably. This may be fine for (virtual) watercooler conversations, but to track the right metrics and improve your development process, you need to understand the differences.

Productivity is the ratio of output (i.e., the quantity of work completed) to input (i.e., effort, time.) This metric is easy to measure, so most people focus on it. But as you’ll see, it doesn’t tell the whole story.

Efficiency is measured by the amount of resources (e.g., time, computation power, human resources) used per unit of best possible output. It accounts for all the input required, so you can see if the team is doing enough of the right kind of work.

Productivity vs. Efficiency: What’s the Difference?

Now you may wonder, which one should you track? The answer is both! Here’s why.

Quantity vs. Quality

While productivity focuses on quantity, efficiency addresses quality. Productivity measures bulk output, while efficiency shows if the product meets requirements. The best software developers are productive and efficient — they produce a high quantity of output that works as intended.

Underlying Costs

Efficiency accounts for the resources used and therefore, the total cost that goes into producing the output.

For example, Joey writes 120 lines of code in a day, and Billy writes 80 lines. But Joey’s codes are messy, so Bob spends two days cleaning them up. Meanwhile, Billy’s codes are perfect. We only get 40 lines of code per day out of Joey’s work, instead of Billy’s 80. Ultimately, Billy’s codes are “cheaper” to produce.

Raw Measure vs. Refined Measure

Productivity is a raw measurement that only shows you the quantity produced. Meanwhile, efficiency is a refined measurement that addresses the amount of output that generates results (e.g., profit.) As such, it has a built-in quality control component.

Improving efficiency may not increase output, but helps ensure that the products will fit the requirements. As such, you don’t have to spend a lot of time, money, and other resources to fix the output.

Raw Measure vs. Refined Measure

Why Is It Important To Distinguish Between Productivity And Efficiency?

“What gets measured gets done.” How you measure output will drive how you organize and complete your work. When you understand the differences between productivity and efficiency, you can choose the right metrics and focus on tasks with the highest strategic value.

You will become outcome-driven, instead of just output-driven.

Productivity vs. Efficiency: Which One Should You Focus On?

Using the right metrics helps you focus on making meaningful improvements. Here’s how to best leverage measurements on productivity and efficiency.

Productivity: Best For Tracking Personal Performance

Measuring productivity is essential in software development because of the human-intensive nature. It helps you track how long it takes to complete each task.

You’ll learn what affects your performance and how you can make improvements to increase production. It’s best to analyze the time it takes to produce the same amount of output of similar quality, so you’re comparing apples to apples.

Efficiency: Best For Measuring Process Performance

Tracking efficiency helps you develop a holistic view of a development process. It gives you insights into all the resources required and where waste may occur so you can fine-tune the process.

You can identify areas for improvement that are beyond an individual’s time and efforts. For example, you may reduce man-hours and increase the quality of the output by using automation technologies.

Take It With a Grain of Salt

Productivity and efficiency aren’t perfect metrics. They only capture a small set of information and don’t give you the full picture. Here’s the fine print:

  • Although they’re effective for measuring established processes and activities, they can’t fully capture the value of innovation, creativity, inspiration, and experimentation.
  • They can help monitor short-term activities but should not be used as the determining factor to justify important or radical decisions with long-term implications.
  • They can help indicate that a problem may exist, but they don’t give further insights into the root cause to direct your investigation.
  • They’re not the be-all-end-all measurements. Your best solution for improving outcomes may not lie in optimizing productivity or efficiency.
  • While productivity measures the “human element,” it fails to account for the many human factors, such as burnout or stress.

How focusing on productivity can go wrong

Solely focusing on output quantity in the short term can cause managers to push team members to the brink. You could get a team of developers to work 60 hours a week for a month. Great for now. But if you do that month after month, they will eventually suffer from burnout, stress, and low morale. You’ll run into issues such as poor quality and a high turnover rate in the long-term.

How focusing on efficiency can go wrong

Processes exist for a reason. If you focus on cutting inefficiency in one part of a process without considering the whole, you could be causing disruptions with a high long-term cost. You may even create obstacles in other parts of the process, causing unnecessary hiccups and frustration, or harming your team members’ overall productivity.

True Productivity = Productivity + Efficiency

Productivity without efficiency is moot.

It doesn’t matter if a developer can write 300 lines of code a day if only 2 lines achieve the intended result. You’d end up paying even more to have the other 298 lines of code fixed.

Being productive doesn’t mean you’re efficient.

Measuring productivity in a vacuum without addressing the context could cause you to overlook other factors that contribute to long-term success. You need to connect the two measurements and put them in context to understand the true value of your output.

How To Analyze the Performance Of Your Development Process

To understand efficiency, measure the time you spend on a task and the results you produce. Tracking your time is a good start because it gives you the data you need to see where inefficiencies may occur so you can further investigate and make improvements.

Next, you should understand how to, and not to, measure productivity because what you measure becomes what you focus on.

How Not To Measure Developer Productivity

These commonly used metrics could do more harm than good:

  • Work hours: Sitting at your desk and typing furiously doesn’t mean you’re creating value. Long hours can even cause burnout and decrease productivity.
  • Source lines of code: If you use this metric, developers may write more lines of code just to appear productive while sacrificing the quality of the work.
  • Agile story points: Story points are subjective measurements and estimations. They can’t give you an objective way to compare productivity across teams.
better ways to measure developer productivity

Better Ways To Measure Developer Productivity

  • The number of closed tickets: Track how much meaningful work gets done by counting how many issues get resolved within a specific amount of time.
  • The quality of documentation: Make sure that developers aren’t creating documentation for the sake of checking things off the list (e.g., padding their numbers with filler words.)
  • The number of deploys: This measures how many upgrades have gone live to deliver more value to the product’s users.
  • Overall forward progress: If your team looks busy but falls behind schedule, they may be focusing on the wrong tasks.
  • The number of completed code reviews: This often correlates with the number of tickets closed or how well a project is progressing.
  • The number of defects: Efficient developers produce fewer defects. However, you should factor in the complexity of the task, so you don’t discourage people from taking on challenging projects.

Become a Rockstar Developer

Measuring your (or your team’s) productivity and efficiency ensures that you’re producing output that works. These terms could mean different things for different people, so it’s important to get clear on what they mean and define the metrics you use to calculate them.

When you choose the right metrics to measure productivity and efficiency, then put the measurement in context without losing sight of the human element (e.g., stress, morale) — you have a winning formula for building a rockstar development team.

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