Why a COO Might Be the Most Important Hire You Make
CEOs get a lot of praise in the media. It’s not surprising that taking on the title of CEO is one of the most wanted jobs among ambitious people. There’s a certain ‘impressiveness’ that comes with the title, but we often forget about the people alongside the CEO.
Like in superhero movies, some of the most successful entrepreneurs are backed by a solid second layer of management, including a chief operations manager. COOs form part of the superhero team in the background, providing the support and guidance needed to keep a growing business thriving.
While COO’s don’t take up as much of the spotlight as CEOs do, that doesn’t mean they aren’t doing kickass work in the background. Consider well-known COOs like Sheryl Sandberg from Facebook, Jeff Williams from Apple and Belinda Johnson from Airbnb.
Those three COOs, and others, have all helped their companies reach new heights by bringing various teams together, tapping into new markets, or exploring new avenues. For example, Sheryl Sandberg’s focus on positioning Facebook as a platform for small business advertising helped increase ad revenue by 27% during 2019, to $69.7 billion. She also ranks highly on the Forbes list of influential women and is worth nearly $2 billion. She’s damn impressive.
There’s no doubt that COOs form a crucial part of an organization; but is it time for you to hire a COO?
Firstly, what exactly is a COO, and why would your business need one?
The chief operating officer, or COO, is one of the oldest C-suite positions. In the simplest of terms, a COO is a second-in-command to the CEO, the Robin to your Batman.
Their primary task is overseeing the daily operations of the organization. But, we like to think of COO’s as master integrators.
Their role is to make things happen. Ensuring that systems and policies are in place, people are taking action, and that the company is functioning as it should be, based on the processes, strategies, and plans put in place.
A few practical examples of what a COO does include ensuring that:
- You have sufficient supplies
- You are working with suitable suppliers
- You’re dealing with proper functioning policies
- You have a well-functioning HR department
Each organizations’ needs generally determine the exact responsibilities of the COO, with each organization being different. There are never two absolutely similar roles.
Harvard Business Review defines the COO role concerning the CEO. Saying that the differences among COO roles arise from the different motives behind creating the position in the first place. They found that there are seven primary reasons for hiring a COO, and these reasons make seven roles that a COO can play, including:
- The executor
- The change agent
- The mentor
- The other half
- The partner
- The heir apparent
- The MVP
A significant difference between the role of the CEO and COO is that CEOs address longer-term and broader picture issues while the COO maintains the focus on the here and now.
Why would your business need to hire a COO?
Firstly, as the CEO, if your goal is to minimize your involvement in your business, you’re going to need to have a right-hand man/woman that you trust to carry out the day-to-day operations. A COO takes these tasks off your plate, leaving you to focus only on the critical decisions.
Apart from giving the entrepreneur more time, the most significant benefit of having a COO in place is having someone at a high level who can oversee all of the departments and entire structure; ensuring that things are working well.
COO’s are there to make sure that all the visions, policies and strategies are actually in action and don’t just become something that you talk about.
If you don’t have someone overseeing your entire operations, it will directly impact all other divisions within your organization. Because if an organization is not running well on an operational basis, things can quickly fall apart.
How do you know when it’s the right time to hire a COO?
The biggest sign that you should hire a COO is if you lack policies and processes — with processes being a critical point. Processes ensure that your entire team and everyone involved in your business are consistently going about things.
Consistent processes are necessary for creating a solid customer experience and ensuring that your team is performing well. When processes aren’t in place, it becomes a lot harder to manage people.
Another sign that a COO could be your best hire right now is if you’re finding yourself getting stuck on certain things. You may have great ambitious ideas and strategies, but you’re having trouble with getting them to the resolved phase. Dreamers and visionaries are great, but you need someone to push things forward if you’re going to grow.
And lastly, it’s a good idea to hire a COO if you’re not quite sure about how to go about hiring the right people. While your HR department can handle the hiring process, a COO can help identify where you have resource gaps and the types of people that you should have in each department.
Simply put: if things are messy, chaotic, unorganized, and unstructured in your organization, you’ll benefit from having a COO.
Sometimes, however, hiring a COO isn’t always necessary.
For example, if you’re not quite ready to start delegating and letting go of the overall control in your business, you may be wasting your time hiring a COO. A COO will only be good at the role if they have freedom, independence and can get stuck in and get things done without having too much back and forth with the CEO.
Secondly, if your business is still relatively small and you haven’t started growing yet, then a COO may not be necessary just yet. However, if you’re looking to grow and map things out correctly from the beginning, then it’s time to hire a COO.
What to look for in a COO?
The perfect COO can oversee both the high-level picture, like what the CEO does, and make things happen—ensuring that things are moving forward in the business and that everything is in order.
But, what makes a good COO? Well, that’s a tricky question to answer.
There are a few misconceptions about the role of a COO, mainly because you can’t clearly define the role. There is no single agreed-upon description of what the job entails because it’s different in every organization. And what makes a COO good in one organization may not necessarily make them good in another organization.
Here’s what Timi Orosz, COO of Insights Lab, said about joining the team:
“When I first chatted to A.J. Lawrence about taking B8F and Insights Lab to the next level, all I could see was the big picture. The exciting opportunity to create well-functioning systems, standardized processes, and a strategic approach to create value both for the customer and for the team. The skills I picked up previously as a CEO of a startup company were extremely transferable into a COO role. I’m eager to steer our companies into a direction that makes a positive impact on our customers’ growth journeys. “
In general, strong qualities to look for in a COO are that they’re reliable, accountable, driven, comfortable with making decisions, can remain calm in chaos, and (most importantly) aren’t afraid of getting their hands dirty.
You’re looking for the Charlie to your Angels. Someone who can keep tabs on all moving parts, understand the bigger picture, be systemic in their approach, and lead a team towards a common goal.
In addition, there are a few things that make the relationship between a CEO and COO work:
- There needs to be mutual respect and trust.
- A checked ego from both ends, particularly from the COO.
- A good communication flow.
- Good coordination of skills.
- Clear boundaries and decision-making rights.
In our interview with investor and mentor Chris Guerriero, he spoke about entrepreneurs needing to leave their ego at the door and know when to ask for help. And that the main thing that drives growth is putting the right people together, which is precisely what a COO does.
Growing a business can be chaotic at times, especially when you start growing quite quickly. Before things start ramping up too much, consider having a COO in place. Their role is to ensure that possible chaotic events are relatively smooth and slick; and that the entire company works like a well-oiled machine.
Do you know any brilliant COO’s that we can interview?
We’re working on a series of interviews with COOs, diving deeper into the importance of the role and understanding why and when businesses need to hire COOs. If you know someone in a COO role who has a great story to share, please contact us with their details.