According to a Chief Operating Officer, or COO, is “the senior manager who is responsible for managing the company’s day-to-day operations and reporting to the Chief Executive Officer (CEO).”  In my experience, this is right on target.  The COO is detail-oriented and can translate the business strategy into tactical execution.  Generally, they watch over the routine tasks involved in operating a company so the CEO or President can focus on strategy, sales, and marketing.

Many startups and entrepreneurial ventures are created by people who have a specific expertise, have great product vision or who develop a creative solution to an unmet market need. Think about the technology companies that you know.  The company founders are really great programmers or product people.  They can come up with and code the best app you’ve ever seen in a matter of hours.  But do they know how to run the business or motivate employees?  In the case of a professional corporation/partnership like a law firm, a firm might be started by some killer lawyers who know how to litigate, but do they know how to do resource allocation, select employee benefits or manage the books? 

This is where a COO comes in.  Ideally, the COO is a detail and process oriented person who can translate the vision of the founder into an operational business that actually makes money.   If the company founders are strategic visionaries who are highly technical, it helps if the COO is a good compliment; expert in process and people.

In many organizations, the COO is responsible for:

  • Service Operations
  • Sales Operations
  • Human Resources
  • Facilities
  • Information Technology (in organizations small enough not to have a CTO)
  • Finance (in organizations without a CFO)

Generally, Sales and Marketing are not part of the COO’s responsibility; however that varies by organization and the specific skill set of the person taking on the Chief Operating role, as well as the other skill sets in the company.

Not every business is big enough to warrant a COO.  Depending on experience, a COO can be a big ticket payroll expense.  If the business is small, there may not be enough work to keep such a high level person engaged.  In this instance, a part-time or project-based COO can be perfect for the job.  A business can leverage a high-level COO’s talents and skills, without committing to the full time salary.  The founders can benefit from the external business perspective, yet still remain close enough to the business to learn and grow with it.  An outside COO can bring his/her years of experience and contacts to the business to help it scale to a point where it needs, and can pay for, a full time COO.