Model: Efficiency frontier in the efficiency matrix

August 29th, 2022

Efficiency frontier


theoretical perfect state

impossible to achieve

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Unfortunately, the star is a theoretically perfect state,

which is worth striving for but impossible to achieve


to reach the star requires perfection

  • customer's present and future needs

  • flexible and reliable resources



  • variation in demand

    • perfectly predict (what, when, which amount)

  • variation in supply

    • perfectly flexible resources (what, when, which amount)

    • perfectly reliable




impossible to reach an operational state beyond the efficiency frontier

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defined by level of variation

the efficiency frontier is pushed inwards as variation increases

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The better an organization at developing capabilities to handle the two conditions

- predictability of demand


- flexibility and reliability of supply,

the further out the organization will move towards the star in the perfect state


(src: Model: Efficiency Matrix)