Circuit-switched networks establish a dedicated connection between devices before communication can occur. This involves a connection setup phase, data transfer phase, and connection teardown phase. While circuit switching guarantees bandwidth for the connection, it is inefficient because resources are allocated for the entire duration even if no data is being sent. It also has longer delays than packet-switched networks due to the setup and teardown phases. Packet-switched networks break messages into packets that are transmitted independently and may take different routes to the destination, providing more efficient use of network resources but less reliability than circuit switching.