As COO Kim Hammonds of Deutsche Bank becomes the latest senior executive to quit the bank, let’s have quick look at the amazing role of COOs in the world of corporate.
Traditionally the COOs of organizations were considered as the right hand of the CEOs. Today in many cases their existence in the organization is based on helping to make the CEO’s vision a reality. The COO is expected to make the CEO more complete in his role. The role can be something like that of the Prime Minister who reports to the President.
The role & evolution of COO
One thing that becomes immediately clear when you start to examine the class of COOs is that there are almost no constants. People from a variety of backgrounds have ascended to the role & succeed. This lack of a fixed pattern makes the job role hard to study & difficult to identify whether proper inferences are made when one COO is compared to another.
Marketers or salespeople who have polished up the skills of their trade can apply them to the business nature of various companies that too in good advantage. In the same manner, Financial & human resource executives likewise are schooled & practiced in standard ways of doing things. But it’s hard to perceive whether a COO who has succeeded in one organization has what it takes to be in another because the skillset is neither generic nor very portable. The right qualifications for the COO role can shift even within a single company.
It’s also damn tough to pinpoint the kinds of corporate environments where in which the COOs thrive. While COOs are generally seen in operations-intensive businesses, they also appear in various other sectors. Same organization may operate sometimes with a COO or without one. In some other cases, the company will turn responsibilities for all areas of business operations- which includes marketing and sales, production, and research and development over to the COO.
What we can infer from all this is that there is no single agreed-upon description of what the job requires or what it even means from company to company. It’s purely based on the skills that a particular person has earned through experience in corporate. For example, we can take the scenario when Kevin Turner from Wal-Mart was appointed as COO of Microsoft. The company stated that they appointed Turner as they wanted him to lead Microsoft’s efforts to grow the consumer products business using his retail experience.
This is why the class of COOs remain mysterious. Their role is socially, strategically, structurally and politically unique. Moreover, it is incredibly situational.
Kinds of COO
From all the content mentioned above, I don’t blame if you have thought that the job of a COO simply defies definition. But the actual fact is that the differences among COO roles arise from varied motives behind the creation of the position in the first place. According to researchers, there are seven basic reasons on why companies hire a COO & these roles are not mutually exclusive.
One of the crucial roles of a COO is to ensure the execution of strategies which are developed by the top management team. It’s a concession to the complexity & scope of the CEO’s job today, with it’s numerous external commitments. Here, the COO takes responsibility for delivering results on a target basis.
The Change Agent
Sometimes corporates appoint a COO to lead a specific strategically planned motive, such as a major organizational change, a turnaround, or a planned rapid market expansion. The magnitude of challenges that the change agent faces demands a degree of unquestioned authority that is similar to that of an executor COO.
There have been times when companies have brought in a COO to mentor young or inexperienced CEO. This is because even rapidly growing entrepreneurial ventures that have the capability to conquer markets need industry veterans with seasoning, wisdom, and a rich network who can develop both the CEO & the business.
The Other Half
The other half is brought in a company primarily to complement the CEO’s experience, knowledge, business style, or penchants. Most of the time it’s considered as a foil because the skillset of the COO will be contradictory to the ones of the CEO.
However big the company may be, the people who work there are ultimately humans. Majority humans’ works best with partners & this goes same for CEOs also. CEO working with COO whom he considers as a partner can be considered as a “two in a box” model or as “co-leadership.”
The Heir Apparent
Most of the time, the reason to establish a COO position is to groom a company’s CEO-elect. The board will expect the CEO to learn the whole company: its environment, business style, & most importantly people. The COO position is best to learn the company’s ways & approaches for an aspiring CEO.
Ultimately, some companies offer the job of COO as a promotion to executives who are too indispensable, particularly to a competitor. With this strategy, a company can set a timetable for leadership succession, to keep its high potential employees intrigued about what the future holds for them, should they stay on board.
As we have said, these roles are not mutually exclusive. Even though it’s hard for a single person to don all of these roles, it’s possible for a COO to wear two of them simultaneously.
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COO –Still on the rise
Anyone who has worked as or alongside a COO will tell you that the job is demanding. The role is unique & can be effective in forestalling off wanderlust. As the key individual responsible for business transformation, definition & implementation of strategies, COOs must be able to manage & inspire people at the highest level. The nature of businesses is becoming more & more complex with the increase in the amount of litigation & regulation that needs to be navigated. With the COO being at the side, the CEO won’t be swamped with the details & minutiae that are outside the remit of the role.