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Performance Goals for Operations Managers

by Mary Bauer

As the job title implies, an operations manager is responsible for the day-to-day operation of a business. She tracks productivity, sets policies, decides how resources will be used and oversees the work of subordinates. When things go wrong, she might deal with angry clients and, when necessary, discipline subordinates. Performance goals for an operations manager should reflect each major aspect of this complex, multi-faceted job. To be effective, goals should be simple, measurable and specific. The average annual salary for general and operations managers was $114,850 as of 2012, according to the U.S Bureau of Labor Statistics.

Production

Production is the heart and soul of an operations manager's job. His performance goals should reflect targets for volume and quality. These goals might include something like, “Increase production by 10 percent within three months, while maintaining current quality standards;” or “Streamline production processes to decrease the length of time it takes to build a widget by 20 percent within the next year." For service-related industries, production goals should focus on projected sales, such as a specific percentage increase in hotel room rate occupancy or a target dollar value of client contracts.

Employee Oversight

Without employees, there would be no products. An operations manager must strike a careful balance between keeping employees happy and ensuring they are productive. While it’s hard to quantify a manager’s effectiveness in motivating employees, it is possible to measure the level of his communication with subordinates. For example, performance goals can include a requirement to provide each new employee a written statement of duties, to prepare a training and development plan for each subordinate, and to submit written performance evaluations for each member of the work unit at least once per year.

Resource Management

Operations managers decide how money, equipment and people will be used. Performance goals should establish measures for effective allocation of resources to produce optimal results. One method is to compare the cost of goods and services to the sales price of goods produced or services provided so that the company's margins are big enough to ensure profitability. This kind of goal might say, “Ensure that the cost of goods and services does not exceed 40 percent of the sales price of the product.” In addition, performance goals for an operations manager should include a requirement to ensure adequate staff coverage to keep production lines running and to ensure the unit meets all deadlines.

Customer Relations

When a customer is unhappy, either because the company failed to satisfy her or because she’s just a prickly personality, the operations manager has to know how to repair the damaged relationship and avoid losing the client. Measuring this can be tricky, so you need some sort of customer survey system. Performance objectives could specify a target customer approval rating, such as at least four out of five stars, or they could include a maximum limit of customer complaints per month.

About the Author

A retired federal senior executive currently working as a management consultant and communications expert, Mary Bauer has written and edited for senior U.S. government audiences, including the White House, since 1984. She holds a Master of Arts in French from George Mason University and a Bachelor of Arts in English, French and international relations from Aquinas College.

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