The role of a COO
4 min readMar 25, 2023
A COO knows how everything — every function in a company — strategically, operationally and tactically works together to deliver its products and services effectively and efficiently. Even though the COO may not be an expert in all things finance, technology and sales, they understand each area deep enough to know how they work together. They recognize that all companies are a system of systems that need to function in concert with one another to run well.
Here’s what it means to be a COO — from a few hours into reading about it. So a lot of it is curated content stitched together with GPT into a narrative. Very little is original content. This was mostly an excercise in making sense of the role for myself out of curiosity.
Quickies
- Rabois‘s’ metaphor for a COO at an early-stage company: an emergency room doctor. Just like in the ER, there’s always something broken at a start-up, it’s incessantly chaotic. There can be issues that seem to be just a cold, but they can actually be fatal if you don’t address and fix them early on. Also, there can be other kinds of issues that seem to be serious, but in actuality they’re just everyday colds and they’ll clear up on their own.
- U.S. professional sports teams. The CEO is the General Manager, and the COO is the Coach. CEO acquires assets, Coach puts them to good use.
- Company as a ship, the CEO would be the Captain and he would be responsible for steering the ship and ensuring that ship is constantly moving towards it’s destination and the COO would be the first mate and would ensure that the ship was in a good running condition to get to the Captain’s destination.
- “What makes a great COO?” akin to asking, “What makes a great candidate for U.S. vice president?” A Southern Baptist? A foreign-policy wonk? A charismatic campaigner? A centrist? It all depends on the other half of the equation, the first name on the ticket.
- If you think you need a COO, per se, anywhere earlier than $10m-$20m ARR … something is wrong in the management team picture. Once you are at or past Initial Scale (say $10m ARR), is liberating. Once you are at scale, done right — a COO should manage all the things you, as CEO, cannot uniquely manage.
- In 2000, 48 percent of Fortune 500 and S&P 500 companies had a COO1 ; by 2018, that number had dropped to an all-time low of 32 percent. But COOs are making a comeback. As of 2022, 40 percent of leading companies had a COO.
- A 2003 study by Crist Associates, for example, showed that only 17% of the corporations that promoted a COO to CEO in the previous year had replaced the COO.
Skills and mindsets
- Generalist: A COO needs to have a broad range of skills and be able to adapt to different situations as they arise. A strong understanding of all areas of the business, not just their own area of expertise. This helps them make informed decisions that benefit the company as a whole.
- Cross-trained: A COO must be like a cross-trained athlete, able to step into different roles and perform well. This requires a high level of adaptability and flexibility. A COO needs to have enough deep expertise key areas of the specific business of the company, such as manufacturing, finance, or design. This allows them to provide guidance and support to key initiatives.
- Editing vs writing: A COO must be able to switch between editing and writing modes. They need to be able to both create and refine plans and strategies to ensure that they are effective and meet the needs of the company. More editing than writing.
- Context switching: A COO must be able to quickly switch between different tasks and priorities as needed. This requires strong time management skills and the ability to stay focused even in high-pressure situations.
- Unblocking: A COO must be able to identify and remove obstacles that are preventing the company from achieving its goals. This requires strong problem-solving skills and the ability to work collaboratively with others.
- Operationalizing ideas and projects: A COO must be able to take ideas and turn them into actionable plans. They must be able to work with other executives to develop strategies that can be implemented at the operational level.
- Creating systems: A COO must be able to design and implement efficient systems and processes that help the company achieve its goals. This involves identifying areas for improvement and implementing changes to increase efficiency and productivity.
- Culture and HR: A COO must have a strong understanding of company culture and be able to develop and implement HR policies that support employee retention and growth. This includes developing growth frameworks that help employees advance within the company.
- Organizational design: A COO must be able to design and implement organizational structures that support the company’s goals. This involves identifying the roles and responsibilities of each department and ensuring that they work together effectively.
- Understand trends: A COO needs to have a deep understanding of the industry trends and how they impact the company’s operations. This helps them make informed decisions and implement strategies that keep the company competitive.
