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What is a COO?

Why Don't All Companies Have COOs?

How Do People Become a COO?

Coos Often Do a Lot of Everything

Establishing Culture and Team Building

Final Notes


One of the most misunderstood positions in business, the chief operating officer is an important part of many larger companies. As one of the most sought-after positions in companies, it often has a salary between $200,000 and $700,000, though COOs in smaller businesses may make less. A company will only have one COO, and many companies choose not to have one. Due to this, the role itself has a mysterious air and can be a little harder to understand without a bit of digging.


What is a COO?


Traditional operations leadership roles are diverse, and it is important to note that the middle “O” in COO is operating, rather than operations. Operations is an essential part of many companies, and many people confuse the COO role with roles dealing with operations management. Unlike other C-suite positions, like CFO and CIO, COOs are less singularly focused on a specific function and more on how all of a company's aspects function together, strategically, operationally, and tactically.


The way a company works together to deliver its services and products effectively involves a lot of moving parts. A COO position combines the business's plans and strategies, its operating model, and the structure of the organization, and uses the information to move the company forward. They use their knowledge to make decisions, give advice, and help keep the company running smoothly.


While a COO is not an expert in all these things, they understand each area well enough to know how they work together in great detail. They can also recognize and lead when it comes to big-picture decisions and understand how systems work together to function well. With so many moving parts, COOs play an important role in a company.


Why Don’t All Companies Have COOs?


Many variables are considered when determining whether or not a company needs a COO. One of the biggest factors is a company’s size and revenue. A fractional COO might be a smart option, though the right COO can often be expensive. COOs are used to high salaries, benefits, and bonuses. If your company is not quite big enough or does not make enough money, it may be difficult to find the right talent for you.


In many cases, the company’s CEO or president fulfills this role. Some companies, however, are concerned about the CEO filling this role. This is due to them filling the role of visionary and integrator as well. Companies with COOs often value the CEO working “in” the business and the COO working “on” the business.


How Do People Become a COO?


Many companies also do not have a COO due to the difficulty in becoming one. COOs often have at least 13 years of experience, with many having over 20. While a large part of that experience is often in operations, they also know program and project management, process improvement, and many other aspects of management.


Good COOs have often managed many different companies, organizations, and positions. As accomplished leaders, many of them have experience in consulting, have owned businesses, and have also been involved in business coaching. Through all of this experience, they have learned skills in financing, human resources, marketing, sales, technology, and more.


Also, many COOs also have strong educations, a lot of training, and a certification-centric background is also common. While there are not many COO-specific education programs, a combination of education and experience helps determine if they are the right fit for specific companies.


COOs Often Do a Lot of Everything


When it comes to being a COO, life can be busy. Humanizing operations is an important part of what is COO does, and COOs are known for looking at the big picture. Creating a safe environment for employees where they can communicate well is essential. Working as a part of many different teams and facilitating communication between them, the COO will have to generally be involved with one-on-one meetings with a company’s most prominent leaders.


Group meetings, recruiting, and onboarding can also be part of the process. With a focus on all elements of a business, COOs can also play a large role in customer success and satisfaction. Through strategic planning, businesses sometimes rely on COOs to help them establish a good rhythm when it comes to teamwork, business strategy, strategic planning, vision, goals and tactics, and more. When the management team meets, the COO often comments on how different departments are working together and what the results look like.


Establishing Culture and Team Building


The company's upper management deals with a lot of stress, fast-paced decision-making, and problem-solving. It is important to create an environment where people feel comfortable in their positions, working with others, and in their environment. The COO is sometimes charged with creating processes and systems that help people work together, help decrease stress, and foster an environment where it is okay to talk about things other than work. All of this happens while keeping a focus on the important decisions that need to be made on a daily basis.


Depending on the position, many COOs work with Controllers, managing accounts receivables and accounts payable. Whether sending out invoices, communicating with those who send out invoices, collecting payments, putting checks in the mail, or making sure the finance department is working well with all of the other departments in the company, a COO fosters communication, accuracy, and efficiency.


In some cases, COOs are charged with taking on tasks the company does not have staff for yet. One example of this could be human resources. If a company is not quite large enough to have a full-time HR manager, some of the human resources management will fall onto the COO’s plate. Everything from performance reviews to managing group benefits plans can fit under this role. As the company expands, a COO’s responsibilities may change.


Final Notes


A COO, also called the chief operating officer, is an executive at the highest levels of the company. They ensure the company runs efficiently. It can take a great deal of time for someone to have the education and experience necessary to be a COO, though understanding what the role entails can help you determine if hiring one is right for your company.


In a leadership position that manages a business's day-to-day administration, productivity, management, and personnel matters, the COO is often the second-in-command in the business. Through effective communication with other company executives, the COO develops a culture of improvement and growth while also overseeing the operational aspects of the company. What the job entails can vary depending on industry, sector, or individual business. In most cases, however, the COO oversees a wide range of departments, helping them work together to deliver on the company's vision in a functional way.

5 min read

What Does A COO Do, Anyway?

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