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Have You Considered Adding a Chief Operating Officer To Your Executive Team?

May 19, 2017 0 Comments

         Doug Eadie

A two-person executive office consisting of a chief executive officer who focuses on the relationship with the board, strategic planning, and external/stakeholder relations, and a chief operating officer (COO) who oversees all internal operations, is a staple in the for-profit sector. And these days I’m seeing the configuration more frequently in larger public and nonprofit corporations where several senior executives once reported directly to the CEO.  There’s a pretty compelling reason for adopting this executive management structure:  freeing up the CEO to focus upward and outward – interacting intensively with her board of directors, promoting her organization’s image in the wider world, and building really solid working relationships with key stakeholder organizations, such the county commission, city council, community college, chamber of commerce, etc.  In light of their heavy dependence on local tax support, and the widespread and perhaps growing skepticism of large public corporations, public transit authorities should at least consider dividing the chief executive function into a CEO and COO.

But despite the powerful rationale for the CEO-COO structure, it tends to be quite fragile and prone to erode quickly, especially in its infancy, and has proved to be challenging to sustain over the longer run, as I’ve learned over the course of a number of coaching sessions in recent years. I’m reminded of a coaching engagement a couple of years ago involving the CEO and COO.  Their executive office partnership was clearly endangered.  Tension had been pretty high from the very beginning of this (in context quite daring) executive management experiment and had recently grown to the point where a parting of the ways (meaning the COO’s exit, of course) seemed almost certain.  The culprits threatening what seemed like a very sensible step forward to the executive leadership front?  Perhaps most important, the CEO, who’d risen through the staff ranks and been at the helm for a decade, was just plain unable to disengage from hands-on involvement in internal operations.  He was constantly looking over his COO’s shoulder, often second-guessing her decisions (most recently questioning her choice of a new CFO), and even rushing to the rescue when he thought an issue wasn’t being handled well.

Their radically different styles exacerbated the tension. The CEO was a real people-person, a true hail-fellow-well-met, who’d warmly welcomed a steady stream of executive team members through his always open door.  By contrast, the COO employed a much more formal and aloof management style, expecting her direct reports not only to make appointments but also to provide her with detailed issue analyses before meetings.  No wonder the senior executives who’d reported directly to the CEO felt cut off and emotionally abandoned.  And it didn’t help that this CEO and his COO had never worked out a formal process for regularly communicating with each other, identifying issues, and nipping problems in the bud.

I’m pleased to report that this endangered CEO-COO partnership survived, and, two years later, it appears pretty solid. Why the turn-around?  For one thing, the CEO was willing and able to muster the self-discipline to change his micro-managing ways.  Also, these executive office partners set up a weekly meeting to discuss issues that might jeopardize their partnership, and the CEO at least once a month chairs the weekly executive management team meeting, providing his former direct reports enough access to ease their angst.  But the problems that threatened this precious, high-stakes relationship might have been avoided if the leadership duo had taken the time at the get-go to anticipate the issues that might threaten the relationship and brainstorm ways to prevent them from developing.

Our next post at this blog will feature a podcast by Aurora Jackson (who goes by “A.J.”), who heads the Lane Transit District, headquartered in Eugene, Oregon.  A.J. describes how she has gone about building a solid working relationship with her new Board at LTD.

Doug Eadie

Doug Eadie, president & CEO of Doug Eadie & Company, Inc. (www.dougeadie.com) helps clients build high-impact board-CEO partnerships.
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