Chief Operating Officer (COO)
The Chief Operating Officer (COO) is a senior executive who oversees the administrative and operational functions of a company. Although not always included in the makeup of a company, those that do hold a COO position in their C-suite will attest to the invaluable role that they play in day-to-day operations. However, what that role is exactly will vary dramatically from case to case. Generally speaking, the COO is somewhat of a second-in-command, or vice president to the CEO. Where the CEO is often involved in big-picture issues, the COO is responsible for making sure all the moving parts work accordingly.
Seven types of COOs
It is widely agreed upon that there are 7 main types of Chief Operating Officers. They are as follows:
The executor is the most commonly thought of type of COO. They keep an eye on the day-to-day operations within the company while the CEO concerns themselves with the vision of the company, public relations and larger-scale decisions. By assuming this role, the COO can help streamline the CEO’s responsibilities by minimizing their need to keep close tabs on the inner-workings of the company.
The Change Agent
This type of COO is often found in companies that have experienced stagnation in vision, or market performance. They are brought in in an attempt to reinvent, or reinvigorate the public’s interest in the company. They are sometimes brought in from a different industry and will present a unique set of skills and experiences.
Oftentimes, the CEO of a company will be inexperienced in many facets of the business world. If the CEO is the inventor/founder of the product or service the company delivers, their expertise may not extend much further than that. A mentor COO will most likely be a seasoned individual who will help guide the CEO through difficult business decisions they are not yet equipped for.
The Other Half
In this role, the COO’s relationship to the CEO is similar to that of the left and right sides of the brain; the COO is very grounded and logically oriented giving the CEO more of an ability to think abstractly. Where the CEO can be rash, unpredictable and flighty, the COO can help ballast the company by attending to a staff’s need for instruction and information with dependable consistency.
The Heir Apparent
This could be seen as more of a “grooming” position. If a CEO is making plans to retire, or to hand over the company, having their next-in-line shadow them so that they might learn the ropes can be a great way to streamline the transition.
A former staff member may rise to the rank of COO if they display a high level of value to a company. This is a way of keeping that individual in the company by offering higher status and compensation, making it less likely that they would leave if a competing offer were to arise.
Some CEOs admittedly work better in a team format. They appreciate the ability to bounce ideas off someone and to draw knowledge and skill from a set separate from theirs. In these cases, a partner COO may be advisable. While technically the CEO outranks the COO, they share a close to equal standing in the company and operate almost as a single entity.
COOs come from all walks of life. They are a varied group of professionals with little tying them together in terms of skillset. One trait that you will find in most COOs, however, is experience. Since the role is often of an advisory nature, a well equipped COO will have extensive experience in the business world. A COO typically has extensive experience within the field in which a given company operates, and they will be looked upon to bring a set of skills and knowledge to guide the company through adverse conditions. In addition to experience, a COO will have a university background, with a bachelor’s degree being the minimum. Most, however, will have a Masters in Business Administration (MBA).
Although Chief Operating Officers are largely responsible for the steering of the corporate ship and, thus, are responsible for the performance of a company, their share of the spotlight will always be a fraction of the CEO’s share. Their work goes largely unsung, in comparison to their immediate superior, but they are invaluable to a company as a “behind the scenes” presence.
In many cases, the COO will take on an intermediary role, meaning they will assert supervision over the staff and inner-workings of the company and relay any information they might have back to the CEO. An effective COO will be competent in all forms of communication. They must also be well-prepared to act as spokesperson for both the staff and C-suite of a company. As they often control the flow of communication through these levels of a corporation, attentiveness and dependability are a must.
The Modern COO
Reports have shown a general decline in companies that operate with a COO in recent years, however, it is very possible that this might soon go in the opposite direction. Companies continue to get larger and more multifaceted as we move forward, making the role of the COO increasingly valuable. Their presence alleviates much of the weight put on the CEO’s shoulders in dealing with day-to-day operations. Currently, there is no set-in-stone rule as to what kind of companies can function with or without a COO.
According to Salary.com, the average annual salary of a COO in the US is $469,286 as of March 2020. As stated before, COOs may be brought in to perform senior advisory roles, or they might be less experienced younger individuals fast tracked for an executive position, which will factor in greatly to their compensation.