The COO role is often one of an organization’s most misunderstood executive positions. While the responsibilities of a CEO or CFO don’t vary too much from one company to another, the COO’s oversight can differ tremendously.
Oftentimes, a COO’s responsibilities overlap those of other executives, leaving executives and employees confused about whom to ask for help.
Organizations and executives who desire to enhance the size of the C-suite by hiring a COO should ask themselves what they expect the new COO to oversee. Finessing the expectations for the COO role before hiring someone to fill it gives clarity to the organizational structure.
However, while defining goals can help a new COO assess what needs to be done, the COO will often bring their ideas to the organization.
While the COO’s oversight will vary from one organization to another, there are certain actions that every successful COO will take.
Understanding a company’s operations is essential to developing a strategic operating plan. If the COO doesn’t understand the inner workings of the organization, they will find it challenging to enhance productivity, minimize waste, or cut inefficient processes.
The COO’s first day will likely begin with an introduction to other C-suite members. A discussion of company goals and strategic direction is likely. Each executive will describe their ambitions for the company and what they are doing to realize them.
The initial discussion with key executives is helpful for the COO to understand the very basics of the company. However, a COO often learns the most when they descend into the company’s actual operations. Knowing how each position supports the organization allows the COO to develop a more thorough understanding of the business.
The COO can use their understanding of the company’s operations to identify the critical roles and those that aren’t currently adding much value to the organization. This understanding forms the basis of reskilling employees to effectively achieve the company’s broader goals.
Many companies — especially larger ones — suffer from non-alignment issues. For example, the salaries of employees who have been with the organization for over a decade may be less than newer workers.
Wage creep occurs when the wider economy experiences a rise in expected salaries. Newer workers benefit, while loyal, long-standing workers receive more minor annual adjustments to their pay. Wage discrepancies can be a source of frustration for employees and lead to distrust in the organization.
Another common issue is employee workload. Over time, more experienced workers tend to pick up extra tasks. What begins as a minor adjustment snowballs over time, and the longer-term worker ends up working much longer hours than other, newer team members.
A good COO will pick up on non-alignment issues within the organization and quickly formulate plans to correct them. An even playing field within the workforce eliminates feelings of resentment between colleagues and improves the organization’s overall efficiency.
It’s not unusual for an employee to feel stale in their role. When worker burnout seeps into an organization, it spreads quickly. Colleagues who feel dissatisfied and unhappy in their positions aren’t proactive and don’t act in the organization’s best interests.
Sometimes, simply moving people to other roles with new responsibilities is enough to get them excited again. The COO should:
If they aren’t responsive to new activities and seem content just to clock in and out, it’s time to push them to a fresh pasture in another company.
The CEO and CFO are considered major players in strategic planning. The CEO drives the overall goals for the future, while the CFO finds the funds to make it happen.
However, a good COO will find a role to fill in strategic planning. While the COO may not drive the financials or decide on the future goals for the company, they can be there to encourage efforts to achieve them.
The COO should focus on the operational aspects of the strategic plan. For example, suppose the organization aims to introduce a new product in the next six months. In that case, the COO can identify roadblocks in the company that could hamper efforts.
Lack of skills, machinery, equipment, or marketing efforts are all potential barriers to success. If management discovers roadblocks early on, the COO can make adjustments to overcome them.
While a COO isn’t responsible for everything in the organization, they should still have a say in every major decision made at the executive level. The COO should participate in financial discussions, future organizational goals, technology enhancements, and marketing efforts.
Even if they don’t have expertise in marketing or finance, they can provide guidance. The COO can suggest implementing specific organizational strategies designed to achieve goals faster and more efficiently.
Simply put, the COO has a responsibility to improve everything they touch. If the COO senses a team isn’t aligned with the organization’s vision, it’s time to take action. Are there unnecessary cost overruns in sales? Time to cut out the fluff and get back to basics.
Are customers complaining that products aren’t up to their standards? The COO can find out why and discuss the issue with the engineering and manufacturing teams. The sky is truly the limit on what a good COO can achieve.
While the role of a COO changes from organization to organization, possessing some essential traits can ensure that the COO makes a solid footprint on the company.
When seeking your next COO, ensure they are on board with organizational change and have the expertise needed to make a difference. The best COOs are often open to new ideas and enjoy the excitement of achieving something new.
The C-Level executives at your company are responsible for either the success or failure of your company. As the CEO, it is your responsibility to ensure that you steer the company to success.
However, you can’t do this alone. You have to work hand in hand with other C-Level Executives and senior members of your workforce. One of the most important of these is the Chief Operating Officer (COO) of your company.
TheCOO is responsible for the day to day running of your company. As such, if your COO is not meting key performance goals, you might discover that your company is veering off course. In order to prevent this, you need to have important metrics you can make use of to evaluate the effectiveness of your COO.
If you don’t have an idea of these metrics, then you’re at the right place. At the end of this article, you’ll have a full grasp of the tools and metrics you can use to ensure that your COO is pulling his own weight and is performing at topmost efficiency.
In order for you to measure the effectiveness of your COO, you need to have a full grasp of what your COO does. Defining the role of a COO is not so straightforward. Each company has different roles for its COO.
In some companies, the role of the COO is to serve as the heir apparent to the CEO. In other companies, the COO is brought on to handle a pivotal shift in the operations of a business. A COO can also be the person tasked with the day to day running of the company while the CEO handles external affairs like getting funding, meeting investors, managing shareholders, and so on.
Unlike roles like the Chief Marketing Officer, Chief Financial Officer, and other C-Level positions, the role of the COO is quite malleable.
You need to be sure of the role your COO plays in your company before you can confidently appraise him/her on the important metrics.
While there are a variety of COO performance metrics you can use to judge the effectiveness of your COO, there are some metrics that would apply to a COO regardless of the company or the industry where the COO operates.
These are usually metrics that generally deal with operations, as your COO is your company’s Chief Operating Officer.
Key performance metrics for chief operating officers include the following:
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