Develop a listing of what you believe are the most important metrics for operations managers. (Hint: Be sure to consider the triple bottom line.) How does each metric support the overall financial performance of the organization? What data would be used to support this metric and how would you ensure that the data are of sufficient quality? How does data analytics support your metrics? Be sure to fully explain your rationale for selecting these metrics.
The most important metrics for operations managers considering triple bottom line are highlighted below. Also, how each metric supports overall financial performance, data used to support the metric and the role of data analytics is explained-
1. Profits from the plant/unit – This is the most important financial metric and the higher the profit is, the better the financial performance of the firm will be with respect to increased revenues and decreased costs.
The data that is required is revenue generated and costs incurred.
2. Overall throughput of the plant – Throughput of the plant determines the productivity of the plant which is linked to the amount of product manufactured, shipped and sold which is directly linked to revenue.
Throughput requires inventory and time data to calculate.
3. Return on Investment – ROI is the return in dollar amount of the investment on the plant and the higher ROI is, the better is the financial performance.
ROI requires investment amount and the profit generated to calculate.