Misconceptions About COO Duties And How A Fractional COO Can Maximize Your Operations
Fractional COO/World Consulting Group - AdvisoryCloudTM
Starting With Your New Remote Chief Operating Officer
So you have decided to hire an interim or part-time Chief Operations Officer. What are the next steps for your organization and how will your new interim COO fit in with your team? It is important to understand how a Fractional COO can improve your operations. Having a clear definition of your Remote COO’s role and duties when you start working is essential.
Common Misconceptions About The Role Of A Chief Operating Officer
Depending on the structure of a business, CEO, President, Second-in-command, and deputy leader can all be similar roles.
The COO role usually ranks below a CEO. and they may have a background in marketing, finance or technology or any relevant sector. The simplest way to look at it is that the COO backs up the CEO and their vision for a company. Due to this structure, The Chief Operating Officer is often at the mercy of the CEO's ideas and desires.
Many companies believe that the COO is one of the more intensive roles in the organization’s C-Suite. Because the COO will deal with pressures from the boss as well as from heads of other departments.
One can assume that it’s a stressful and sometimes horrible fire-pit of a role. Especially in a multi-national or multi-agency company. One might think that handing some of the responsibilities down is best. Thus overseeing rather than implementing might be preferable.
But that isn’t always the case.
The New York Times reported that Twitter’s former COO, Ali Rowghani, quit after seeing his responsibilities usurped by the advertising arm of the company. Combined with disappointing user figures, Rowghani quit before he was pushed to do so. Responsibility is a powerful motivator and removing responsibility can have negative effects.
The Twitter news and the inherent implication that the COO role should have a wider set of tasks is backed by data. According to studies by EY, a third of COOs have experienced a wider set of tasks in the past five years.
Another misconception of the COO is that their role is to stabilize what already exists. It can be the opposite. Oftentimes, a Fractional Chief Operating Officer is brought in to completely overhaul operations. A CEO may find an expert in turning companies around and give their COO the flexibility to execute.
Another misconception is that the chairman is the most important role in the company. In reality, the COO is often the glue that holds everything together at the top. The COO may even be far more experienced than the CEO. The story at Dell computers, where 29-year-old Michael Dell brought in a team including Mort Topfer as the company boomed.
Topfer understood his role was advisory and had no desire to assume the CEO role. Many COOs at a junior stage in their development, still have the ambition to get to the top spot. This aspiration lends itself to many COOs becoming CEOs.
What Are The Common Traits Of The Best Fractional COOs
Asked to name an inspiring CEO and most of us can name many. Like Steve Jobs, Meg Whitman, Bill Gates, Mark Zuckerberg, and Marissa Mayer. Now, if we are asked to name extraordinary Chief Operating Officers, it could be a challenge.
Chief Operating Officers can easily get overshadowed in the public eye by the role of the CEO. Particularly in large traditional organizations. The dynamic has evolved in the digital world with Remote Chief Operating Officers having a bigger impact in remote teams.
According to Accenture, the COO is, "perhaps one of the least understood roles in business today."
Ryan Caldbeck, founder, and CEO of CircleUp, states COOs are vital to companies. Especially during periods of rapid growth or transformation when execution risks are high.
Chief Operating Officer roles are less clearly defined than a CEO's role and scope. Keith Rabois, former COO of Square, describes the COO at a startup as a doctor in an emergency room. Your Remote COO will be fixing things, triaging and diagnosing issues to see if they are minor or serious.
An Interim COO possesses a unique set of skills. Bridging the space between the visionary CEO at the top and the execution of strategy.
Here are the top traits of an effective Fractional Chief Marketing Officer:
- They are strategic with a focus on the details. Sheryl Sandberg, COO of Facebook, is arguably the highest-profile COO today. She has a remarkable ability to dig deep on a wide range of issues. Meanwhile, she also knows the bounds of her duties. When Facebook hit challenges in negotiations with PayPal, she smoothed out differences. A successful Fractional COO balances a breadth of experience and knowledge. Paired with an ability to manage strategically and you have an advantage. COOs keep their company’s high-level strategy front-and-center. They also understand the day-to-day execution to ensure what needs to happen does. Handling those details can be no small matter. Six in ten COOs say the complexity and diversity of the position make the role worthwhile, according to Ernst & Young’s survey of hundreds of COOs. Thus, contrary to the misconception that COOs are only focused on the details of day to day operations, they keep high-level strategy in mind.
- They value and appreciate talent. The best Interim Chief Operating Officer is a people person. They understand the business depends on the combined talents of their team. As your Part Time COO maintains operations, they also keep an eye out for talent. They raise the level of talent by sourcing strong hires and develop the team. “If the COO creates an environment in which people can thrive, then their job becomes so much easier.” Charles Robert Davis, Vice President Director, Darya-Varia Laboratoria Your COO's scope branches out beyond operations to your team's development.
- They have no ego. One misconception is that because a COO holds an executive title, they must have a big ego. The best Fractional Chief Operating Officers set aside their ego for their organization. In putting the organization first, they find ways to highlight the good work of others. Good COOs will give speaking engagement opportunities to a business-line head for example. Also, when media outlets request interviews, top COOs will find ways to share the spotlight.
- They are data-driven. Key business decisions cannot be made based on assumptions. It can be very tempting to rely on your gut to make business decisions. It is a common practice. An effective Interim Chief Operating Officer will take the gut decision of a CEO and will guide final decisions. When a CEO or a business-line head, or director says, “I just know this initiative will be a home run,” the effective COO asks for data.
Data-driven COOs are responsible for ensuring a strategic vision translates into profitable operations. Rather than allow the business to be guided by instincts, internal politics, hunches, the best COOs will insist the business be driven by data.
Businesses should not underestimate the value of a strong Part Time COO. Good COOs instrumental in turning strategy into operational and financial success.
Do Chief Operating Officers Ever Shift From Their Capacity?
One misconception is that the Operations responsibilities of a COO do not translate across the executive suite. However, the COO role is the most common stepping stone by far to the CEO seat.
According to Agile Lean House, not every COO wants to become the next CEO. Thirty percent see the operations leadership role as a destination in its own right. Given the demands and breadth of the job, this is hardly surprising. Of COOs surveyed, most find the role extremely satisfying. The ability to influence strategy and the broader perceptions of the role are appealing.
Why A Fractional COO Is A Necessity And Not A Luxury In Organizations With Little Operations Structure
Some organizations can often overlook the need for a COO, and do not consider the option of hiring a Remote Chief Operations Officer. Budgets may be under certain constraints and focused on product development, sales and other areas of the business. Operations can support everyone on your team, to ensure the business runs smoothly.
Why Hiring A COO Offers You Flexibility And Cost Savings Versus Being An Expense
Today’s business ops are growing to become more complex with businesses operating at the speed of the Internet and change being the norm. Senior leadership must compete and bring together the talent necessary to complete tasks and deliver.
Outsourcing an Interim COO is a great alternative when you do not have the resources in house to fill a Chief Operating Officer role. This option provides you with flexibility and long term cost savings of potential budget waste.
Misconceptions About The Leadership Function Of Your Part Time COO
According to leadership strategy writer, Rajeev Peshawaria, there are common misconceptions about leadership. The first misconception is that most think leadership is about influencing others to achieve a goal. Yet, if we observe world leaders, most did not do anything to others. They set very clear goals and motivated themselves to get things done. In doing so, they set an example to become a powerful role model. Being an example can inspire a team to join the leader’s journey.
The second misconception about leadership is that we assume that the person with the most formal power in a group is the leader. Because the aforementioned misconception centers leadership around influencing others to achieve, this leads to the assumption that to have influenced one must be in a position of power. Leadership has little to do with formal authority. As formal authority will sit with a board or executives in the startup culture for example. Oftentimes, authoritative figures are also far removed from the day to day of business operations. Those with authoritative power may provide high-level initiatives but core operations functions are defined by your COO.
A third misconception is that followership is leadership. For example, in the corporate world sometimes employee engagement surveys result in promotion. This sets a standard for managers to engage in people-pleasing so that surveys highlight positive results. Effective leadership does not involve pleasing the team at all times. A skilled Interim COO will help you make tough decisions for your business but might be unpopular among your staff. Pleasing, in itself, is a behavior linked to following and not leading.
What To Expect From Your Fractional COO In The First 100 Days
Contrary to one might assume, your Interim COO will have a structure mapped out for the initiation of your engagement. Not exactly.
Research indicates that successful COOs must address these critical areas to make an impact:
Expect the unexpected
The reality of the issues facing your business may be of a different magnitude and nature than thought. There will be a long to-do list of pressing problems and challenges. This is particularly true if the role has been filled for the first time or has been established to solve a particular set of business problems. As such, it is important to understand the function of the role and begin to identify the key issues that your Interim COO will be inheriting.
Answer the obvious questions
Take the time to understand the role and the nature of the challenges ahead for your Fractional COO. Keep in mind that a new appointee who seeks to make too many changes early on is sure to make mistakes. It is far more valuable to allow your new COO to get to know the business and meet as many people as possible. It is only by amassing a deep knowledge that they can understand where to act. And how their decisions might impact different functions of the business.
Allow some freedom and mobility for your COO to move
The speed with which your COO needs to make decisions will depend on the nature of the appointment they come into. If operations are in crisis mode, there may be an expectation that significant changes will be made early on. By contrast, operations that are already running well can be a prompt that you will need your Fractional COO to uncover the “next big thing” to deliver.
Network, network, network
Your Part time Chief Operating Officer must be a “people person”. They must be able to develop and work with a wide range of different people. The most important of all is with the CEO, and this will naturally consume a large proportion of the time. The working relationship between a Fractional Chief Operating Officer is expected to be close. Both executive seats must work collaboratively in order to be successful. A hands-off relationship will not be suitable enough to run a successful organization.
Outside of your COO's network, they must be careful not to neglect other members of the management team. Expect your Interim COO to build strong relationships with the heads of finance, IT, sales and marketing and HR, to name but a few. All will have a direct bearing on the role at some point in time. For COOs at large multinationals, international travel is essential. Your Fractional COO will spend time with managers and other senior executives in as many locations as possible if applicable.
Given that the first 100 days can make new appointees feel exposed, it may be worthwhile to identify a mentor or consultant to guide the role. Allow your Remote COO to spend time upfront understanding your team’s issues, responsibilities, and competencies. Identify who your COO can rely on to support them with details. This will free up time so that they can focus on the bigger picture for your business.
Make Room For Your Part Time Chief Operating Officer To Make An Impact
It is imperative that your Fractional COO put their individual stamp on the strategy of the organization. And to reclaim some of the spotlights from more prominent executives. The extent to which your COO will be able to do this will depend to some degree on the relationships and dynamics of the broader management team. It will also vary according to the specific role that they have been appointed to fulfill
Perhaps more than any other executive, COOs have the power to change the organization.
The Current Climate for Chief Operating Officer Professionals
Being the biggest resource at some organizations, it may be thought that the role has a lot of support.
As if the job of the Part Time COO were not hard enough, it also lacks external guidance and support. There are few in-depth studies on the nature of the job and few specifically relevant conferences. For too long, COOs have simply flown under the radar of good management thinking and writing.
There are reasons for this low profile, of course. The huge diversity of the role and the extent to which it varies across verticals and companies makes it challenging to pin down and examine. The responsibilities of the COO are often — but by no means — inward-looking. This means that COOs are rarely called upon to comment in the media or speak at analyst presentations. This is another difficulty they face, in terms of getting airtime for their issues and worries. But several trends are now causing the status quo to be challenged. Operational excellence has become a key source of competitive advantage for many businesses. The tough economic environment demands a relentless focus on the smooth running of the business. This is a task ideally suited to the strengths of the Part time COO. Not that this is easy. Demand volatility, soaring commodity prices, and the divergence between rapid-growth and developed markets require flexibility, agility, and efficiency from operations. Achieving this can be highly challenging in the current climate. The Part Time COO brings coordination to these efforts. Along with the ability to spot interdependencies and opportunities. Still, while the focus on operational excellence should never be downplayed. COOs have to combine these skills with a set of more forward-looking capabilities.
The COO: A Catalyst for Organizational Transformation
For CEOs needing to find breathing space to focus on selling a wider vision, the COO can play a more central role. The COO defines and implements strategy and becomes the owner of the business transformations. more than any other executive, COOs have the power to change the organization. And, as companies look to an uncertain future, this is a skill that will remain in high demand.