Are you the owner or top executive of a company that is growing beyond the ability of one person to manage effectively? Are your internal controls weak or nonexistent and your ability to execute your business plan compromised because you cannot perform every role yourself anymore without support from others? If so, you may want to consider a COO, whether Fractional, Interim or Full-time.
The COO is a senior executive charged with overseeing the day-to-day administrative and operational functions of a business. The COO reports directly to the Chief Executive Officer (CEO) and is the second in the chain of command.
CEOs of privately owned companies, particularly within the size range of $5 – $50 million+ in annual revenue, understand the importance of having a well-rounded leadership team. One of the most critical positions within any growing organization is the Chief Operating Officer (COO). A COO, whether full-time or part-time (Fractional), can bring immense value to a company, ensuring its smooth functioning, profitable growth, and efficient operations.
A COO is an executive-level leader responsible for managing the day-to-day operations of a company. This person oversees the operational aspects of the business and implements the CEO’s vision for the company. They should also help to create and champion that vision. The exact role of COOs can vary from company to company, but, in every case, they are responsible for ensuring the company’s overall success by managing and coordinating the company’s internal operations. As Gino Wickman’s recent books Traction and Rocket Fuel point out, the relationship between the COO and CEO is critical to the success of any business because the skill sets are often very dissimilar but both very necessary.
Insightful CEOs and Boards of Directors understand the importance of having a capable and experienced COO on their team to lead Sales and Marketing, Operations and Finance and Administration. A sampling of COO responsibilities that will vary or evolve depending upon what best complements the skillset of the CEO:
- Strategic Planning: A COO may play a crucial role in developing and implementing the company’s long-term strategic plans, providing valuable insights on how to achieve the company’s goals and aligning the company’s resources to best pursue these plans and ensure their success. The COO can also identify potential risks and opportunities and develop contingency plans to mitigate the risks and exploit the opportunities.
- Operational Efficiency: A COO is responsible for ensuring the company’s day-to-day operations run smoothly and efficiently by identifying operational inefficiencies and implementing solutions to improve them, such as streamlining processes, reducing costs, and optimizing resources. This leads to increased productivity and profitability for the company.
- Talent Management: One of the COO’s most critical responsibilities is managing the company’s talent, developing and implementing effective recruitment and retention strategies, as well as identifying and developing key talent within the organization. A COO can also ensure that the company’s employees are well-trained, motivated, and aligned with the company’s values and goals. The COO may be able to add significant value in this area, especially as more staff are added to fuel company growth.
- Financial Management: A COO works closely with the CFO to ensure the company’s financial stability and growth. Together, they develop and implement financial strategies, monitor financial performance, and ensure that the company is compliant with all financial regulations. A COO also identifies areas for cost savings and revenue growth and implements strategies to achieve these goals. The CFO may report to the COO, depending on how the CEO envisions the ideal structure to support company growth.
- Customer Satisfaction: The COO plays a crucial role in ensuring the company’s customers are satisfied with the products or services offered. By monitoring customer feedback and identifying areas for improvement, the COO works with other departments to improve customer satisfaction, leading to increased customer loyalty and retention.
The hiring of an experienced COO can bring immense value to a growing company. In fact, it is critical if the company is planning to grow at all. At a certain point, the Founder / CEO may need additional operational acumen to drive that growth. From strategic planning to operational efficiency, talent management, financial management, and customer satisfaction, a COO can ensure the company’s success in a way that the CEO, trying to wear multiple hats, cannot. CEOs and Board Members recognize the importance of having a strong leadership team, and a capable and experienced COO is a critical component of that team.
In our experience, the ability of a COO to communicate with the CEO is the key to success in this role because the skills presented in these roles may be quite different from each other. Likely, the CEO created a highly successful initial concept but may need help to fully monetize that concept and to grow it to the next level. The COO will need to have the trust of the remainder of the company to ensure that the COO role is seen as the top operational role in the company. While the CEO may need to make certain high-level decisions, such as to sell or refinance the company, most operational decisions should remain in the purview of the COO.
If you are considering hiring a COO, reach out to us for a conversation. 2GO Advisory Group COOs have 20+ years of experience providing COO expertise to businesses across a wide range of industries and company sizes.
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2GO Advisory Group™ is a San Francisco Bay Area-based pioneer of fractional C-suite services. We leverage our consulting partners and recruiting to customize solutions across executive functions. Business owners and executives value our expertise which spans dozens of industry sectors and practice disciplines. With more than 35 years at the forefront of fractional executive services, our flagship CFOs2GO® has evolved to include COOs2GO™, CHROs2GO™, CIOs2GO™, CROs2GO™, and Talent2GO™. Our multidisciplinary approach helps organizations navigate change, enhance executive leadership, execute business strategy, and operate in both the U.S. and internationally. We use technology and a network of C-Level consultants to provide local representation in virtually every metropolitan community in the U.S. We strive to evolve to meet the emerging needs of clients at every stage of their business. Discover more on www.2goadvisorygroup.com and follow us on Linkedin at 2GO Advisory Group, CFOs2GO, COOs2GO, CHROs2GO, CIOs2GO, CROs2GO, and CMOs2GO.