A theme in my practice is the CEO whose company has reached the point where there are substantial gaps in leadership capacity, succession planning, and operational rigor, and sufficient resources to attract senior talent. In some cases these gaps are best addressed through a series of executive hires, but it's common for a CEO to envision filling them all at once in a single stroke. They're dreaming of that mythical creature, the Chief Operating Officer.
I'm not suggesting that COOs are figments of our imagination. I've had a number of them as clients over the years, and many of my other clients have hired one or worked alongside one. What's mythical about the position is the all-too-common fantasy that there's a pool of candidates whose experience as COO fits a company's needs and the CEO's vision. The reality is that there's no single job description for "COO," and it can mean something wildly different from one company to another:
- CEO-in-waiting, i.e. the designated successor.
- A capable successor to the CEO, i.e. emergency backup.
- A potential successor to the CEO on an extended tryout.
- An "operational CEO" who manages most (or all) internal functions, while the CEO handles external duties.
- The "first among equals" on the executive team with higher status than others.
- The CEO's "right hand" who tackles special projects.
- A glorified VP Ops who may not really merit a C-level title.
- A co-founder who lost the power struggle for CEO.
- Any combination of the above.
And while a COO may have fit one of these descriptions when they started the job, it's quite possible that their role evolved into something entirely different over the course of their tenure. So when a CEO determines that it's time to make this hire, it's far more difficult than with other executive positions to find someone who's done the job before. Yes, a candidate may have "COO" on their resume, but what does that really mean? Which of the jobs above have they actually done? What job are they doing now? And what job do they want?
The first step in resolving this challenge is for a CEO to fully clarify just what needs they want a COO to fill, and, if at all possible, to reach agreement with current executives, Board members, and other stakeholders who may have their own understanding of what a "COO" does. Achieving this alignment not only makes the search process more efficient, because everyone has a shared understanding of what they're looking for, but it also minimizes the risk that a newly-hired COO will face divergent expectations from different parties.
Obtaining this buy-in from existing stakeholders can itself pose a substantial challenge, however. Other members of the executive team will be worried about a loss of power and influence, whether or not the CEO envisions the COO as their successor. This anxiety will be heightened if the CEO is planning to level one or more current reports under the new COO. And this is often the case, both because the CEO is hoping to free up time and attention, and because experienced COO candidates will expect to have a sufficiently broad managerial scope.
There's no simple solution, but timing is key. It's unhelpful to announce the intention to hire a COO too soon, as that can unsettle the executive team, and the search is usually a lengthy one. It's equally problematic to announce the hire too late, particularly when execs have concerns about their ranking in the new hierarchy. I advise clients to err on the side of transparency. If someone is going to resist being levelled or become a flight risk, it's generally better to know sooner rather than later.
Investors and other stakeholders can be skeptical about a CEO's plan to hire a COO, and sometimes this is well-founded. They've likely seen COOs fail to fulfill expectations for any number of reasons. A presumptive successor can lack the capabilities to step into the CEO role. A heavy-handed leadership style or interpersonal issues can lead to a failure to integrate with the executive team. A lack of clarity on the job description can cause frustration on all sides. Or an inexperienced candidate can convince a CEO to give them an opportunity, but they may never grow into the C-level title.
This isn't to say that a CEO should simply defer to these concerns. The CEO knows more about the evolving needs of their executive team than anyone else, and, unless the Board has approval over executive hires, they're not the CEO's boss. But a CEO who's facing skepticism about a COO hire is well-served by ensuring that such concerns are aired and addressed, even if agreement isn't achievable. Because the goal isn't simply to fill the role, but to ensure that an incoming COO is set up for success. And what's the rush? It will almost certainly be a long search.
Questions to Consider
- To what extent do we have clarity on the various needs we expect a COO to fill?
- Where might our respective expectations be out of alignment?
- Is the COO is a factor in CEO succession planning? If not today, might that change in the future?
- Does the CEO's relationship with the COO differ from their relationship with other executives?
- What is the relationship between the COO and other executives? What is their relative status?
- How do other executives feel about this relationship and their relative status?
- How might any of this change as the COO's capabilities and ambitions evolve?
For Further Reading
Fear of the Empty Chair, Part 3 (On Attrition)
Conform to the Culture (Just Enough)
The Evolution of the Executive Team
Not Your Friends. Not Your Enemies. Not Your Boss.
Fear of the Empty Chair, Part 2 (On Hiring)
Photo by Carole Raddato.
