Efficiency is measured as a ratio of output to input. Technically, efficiency is the ratio of useful work performed by a machine or in a process to the total energy expended. In other words, it is a measure of how productively a work or a job has been carried out. Speed, fastness, quickness, doing things right, hardworking, least wastage, and high returns are generally associated with the idea of efficiency. In industrial settings, this is the most scientific and most widely used means to measure performance. Its simplicity and accuracy have led to its far and wide application in all fields including pure sciences, social sciences, management, and in different aspects of human engagements. As precision of measurement in all fields including social sciences has increased, efficiency as a means of measurement has also entered all spheres of human engagements including economic- social-political-environmental assessment (Stiglitz et al., 2009; Nayak, 2017).
Formal structures and systems of district administration in India have existed for over 250 years, beginning with the colonial rule. In the early stages of India, i.e., as a colony of Britain, the primary task of district administration was to enrich the colonial power, Great Britain. Whether it was extraction of natural resources, viz., metal, minerals, cotton, tea, and spices, or collection of taxes from India for the British empire, district administration primarily operated on the efficiency principle. Achieving material targets seemed to have been a key efficiency criterion for the government and public administration officials in India.
Interestingly, the idea of efficiency primarily came from the principle of scientific management developed in shop floors by Frederick Taylor. This idea of performance measurement in factories that are relatively closed systems of operation gradually found a way into the government and the public administration. The efficiency-focused management methods of Taylor have been highly popular and influential. Taylor Society was formed in 1911 to share and popularize Taylor’s efficiency principle of factor)’ management. Operations research as a field of factor)' management was adopted widely in Europe during the First World War, 1914-1918. The success of operations management during the war gave a huge boost to the efficiency principle of factor)' management in Europe.
In the United States, a government “Commission on Economy and Efficiency” was appointed between 1910 and 1913 by President William Howard Taft that introduced efficiency principles of a factory into economic and budgetary planning of the US federal government. In 1920s, Herbert Hoover was the most highly placed exponent of this idea of efficiency-based principle of management. He served as President of the Federated American Engineering Societies (FAES) which was the intellectual birthplace of Taylor Society. Later as Secretary of Commerce, Government of the United States, and eventually as the President of the United States, Hoover promoted scientific management based on efficiency principle at the shop floor of a factor)' to an industry and eventually as a means for national planning (Bruce, 2013).
Later, Luther Gulick, and Lyndall Urwick described seven major activities and duties of any higher authority in the organization such as planning, organizing, staffing, directing, coordinating, reporting, and budgeting (see Gulick and Urwick, 2004). The popular acronym POSDCORB describes these activities in the field of management and public administration and reflects the classic view of administrative management. In the Brownlow Committee Report (1937), Gulick, as a committee member, applied the factor)' administrative processes in the federal government of the United States (Brownlow et al., 1937). The bureaucracy and public administrator officials in India have also largely adopted the POSDCORB framework in mainstreaming efficiency criteria in public administration. The two cases of district administration discussed in this book highlight how the above POSDCORB framework is in practice (see Chapters 3 and 4).
Following the period of Great Depression in the early 1930s, British economist J M Keynes further promoted the application of the idea of efficiency in shop floor to national economic planning in Britain. The period of economic recession following the First World War and subsequent Great Depression seems to have facilitated the acceptance and spread of the idea of efficiency to deal with macro issues of unemployment, industrial growth, and business cycles (Keynes, 1936). With the above background, Keynes argued for macro-economic planning by the state to deal with the chaos and uncertainty in the economy and market. Margaret Thatcher, who became the British Prime Minister in 1978, adopted it in the economic planning of Britain during the 1980s. This model was subsequently adopted by various national governments across the world. The industrial economies, particularly since 1970s, have enforced the various manifestations of this notion of efficiency at factor)’ level or sub-unit level in industrially developing countries under the broad theme of “reforms” to align and facilitate global trade and business.
One of the methods of management, “division of labor,” that was crucial to shop-floor efficiency complemented the notion of “specialization” shared by renowned economist Adam Smith. Other leading economists including Williamson (1985) advanced the idea of efficiency for the very existence of firms in a competitive market economy. These beliefs further snowballed to rationality, division of labor, specialization, and competition as necessary conditions for efficiency not only for a factory, organizations, and small markets but also for efficiency of industries, national economies, global economies, and large countries.