The San Diego Water Department (SDWD), like most utilities, is facing significant challenges. From rapid growth to community pressures to issues unique to the California utility market, San Diego is in need of management tools that can help the Water Department navigate the complexity. Operations Optimization is a tool SDWD has chosen to help minimize costs and maintain a reliable, high-quality water supply while enabling the utility to exceed set performance targets that will lead to achieving the goal of becoming a "Best-in-Class" water utility for its customers. This paper presents how SDWD's Optimization Group worked with utility management and technology consultants EMA to meet or exceed its two primary performance metrics that include: a reduction in net imported treated water purchases by purchasing less treated water, and/or increasing treated water pump-back to the San Diego California Water Authority; and, a reduction in annual energy costs by minimizing energy consumption, and shifting pumping from peak electric energy periods to semi-peak and off-peak periods. Operations Optimization (OO) offers a comprehensive set of management tools that allow SDWD to achieve these goals. Included in the solution is an accelerated software development cycle, advanced software solution techniques, maximized use of existing SCADA system assets, new business processes, and the empowerment of staff through involvement and training. Every utility is different, requiring a solution customized to manage the unique features of its water supply, treatment plants, distribution system, and technology. San Diego's optimization process uses several different components of OO including: Water Demand Forecasting to allow for planned operations; Water Supply Analyzer to optimize water supply purchases and water treatment plant production scheduling; Pump/Valve Optimizer and SCADA modifications to operate pumps and valves to minimize energy cost and use; Energy Cost Schedule for managing energy pricing and accounting for energy consumption and billing; and, System Mass Balance Simulation and Performance Monitoring. San Diego also uses an optimization website to: communicate activities, objectives, and schedule; provide a mechanism for clearing equipment out of service that may affect system operations; communicate the water system daily operating plan; and, to track system performance. By using a "systems" approach to optimization and sharing information through the website, SDWD is able to minimize cost, maximize water quality, and exceed a comprehensive set of performance measures. Includes 4 references, figures.