Question

What are the most important metrics for operations managers?  List at least three metrics that you feel are important. You will need to define each of the metrics. Do any of the metrics support the triple bottom line?   

Answer 1

the most important metrics for operations managers are as below=

1= Financial Business Performance Metric= this ii used by the project managers o estimate the financial aspect of the project. Here it is important to determine the Gross Profit Margin, Net Profit, Net Profit Margin and Debt Asset Ratio

Gross profit margin = (Revenue – Cost of Goods Sold)/Revenue

It is used to find out the competitiveness in the pricing of products and services

Net profit = Total Revenue – Total Expenses.

It is considered as the bottom line of the business.

Net profit margin = Net Profit/Total Revenue

This is quite important for the owners, stakeholders, and shareholders as it describes the profitability of the firm.

Debt Asset Ratio = Total Liabilities/Total Assets

This is needed to be as low as possible

2= Marketing Business Performance Metrics= this metric is important for the managers to find out the effectiveness and the profitability of the various marketing efforts. This can be done by analyzing Return on Advertising Spend, Customer Acquisition Cost, Time to Payback, Marketing Originated Customer Percentage

3= Employee Business Performance Metrics= This is important for the business if they want to boost the operations of the company. This is important as the success of the business depends on the evaluation of the employees and their efforts. In order to do so, we can use Employee Efficiency, Quality of Work and Adherence to Values

Financial performance metric has the potential to have a greater influence on the bottom line of the business as every activity in the business is done in order to have improved financial stability and viability of the business.