What are X-Inefficiencies?

X-Inefficiencies (Xnf) are pervasive in business. The term was coined by the renowned Harvard economist Harvey Leibenstein in a 1966 American Economic Review article, Allocative Efficiency vs X Efficiency. 

Xnf refers to the loss of output that a firm suffers when it fails to fully use its resources. In other words, it's the difference between how much you could be making, and what are you are making. There are many inefficiencies that can build and compound, and we refer to them with the letter X, because though there are common themes, they are unique at each firm. 

Our firm was founded to help businesses identify the slack in their current operations, and remove it through better design based on new behavioral economic research. We observe inefficiencies, implement changes, and then validate our solutions using data. ​​