1. Check for leaks. Leaks in pipes and valves can add up to a lot of water waste. Turn off all water and appliances in the house. See if your water meter is still moving, if it is, you have a leak somewhere. Run through all the different valves, and see if they are leaking when off as well as when they are on too. Sometimes internal parts on valves can be replaced to fix leaks, instead of having to replace the entire valve.
2. Different plants, and different sun exposures need different watering requirements. Lawns should be watered separately from shrubs and trees. Shaded areas should be watered separately from sunny areas. Drought tolerant plants should be watered differently than tropical plants. In areas that have mixed water requirements, set your irrigation system to meet the lowest water requirement, and hand water the ones that need a little extra now and then. For entire yards, add a new valve and station for each unique area.
3. Check your sprinkler nozzles. If your pressure is too high, or too low, your nozzles may not be working correctly. If you see fine mist drifting when your sprinklers are on, your pressure is probably too high for your nozzles. If you have too low of pressure, your sprinklers won't be giving the coverage that they were designed for. Many sprinkler nozzles are adjustable too. If you see that your driveway or sidewalks are getting watered as well as your plants, it may just be a simple adjustment that you can make to your nozzles to save that water.
4. Timing is everything. When, and how long to water is a very important decision. It is best to water plants in the early morning hours. Watering before the sun is up reduces evaporation. How long to water is dependent on two main factors, what kinds of plants, and what kinds of soil. Soil type will determine how much water can be absorbed before it begins to run-off, and how fast water moves out of the root zone. Slow percolating soils, like clay, absorb water slowly, but holds onto the water for a long time. It is best to water clay soils in a few short cycles, allowing water to be absorbed between each one, rather than one long cycle, where water would run off at a certain point. Loose sandy or rocky soils can absorb water more rapidly, but it also percolates out of the plants root zone faster as well. Deep watering is an effective method of watering in loose soils. It encourages deeper root growth, and plants will benefit by being able to access the water for a longer time. To gauge frequency of watering, use a moisture meter, or just your finger, to test soil moisture about 6" below the surface. Soil should be wet after first watering, and allowed to dry partially between each consecutive irrigation cycle.
5. Seasonal adjustments to your automatic watering system are necessary. Water needs vary depending on temperatures and humidity. Take the time every week or two, to adjust your irrigation controller either up or down by a certain percentage to match your weather patterns, or invest in a "smart" controller, that comes with a mini-weather station and automatically adjusts the system daily, based on current weather.