What Does a Chief Operating Officer Do? (With How To Become One)

By Indeed Editorial Team

Published 23 August 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

The role of a chief operating officer (COO) is an essential position within an organisation. A COO is an effective leader, skilled communicator and self-driven person who can ensure smooth day-to-day operations of a company and drive its growth. Having a good understanding of the skills and qualifications required to become a COO can be helpful knowledge. In this article, we explain what a COO does, the skills needed for a COO, how to become a COO and share responses to some frequently asked questions about the COO's position.

What is a chief operating officer?

The chief operating officer, or COO, is a senior-most executive who oversees the day-to-day operations and administrations of a business. A COO is also a member of the executive team and reports directly to the chief executive officer (CEO). The role of a COO is one of the most sought after positions in a company as they are often considered to be the second in the chain of command.

The main focus of the COO is to execute the firm's business plans in accordance with its established business model. Depending on the current stage of a company and its needs, the COO can perform the specific types of tasks and activities to realise the goal of an organisation. For example, the COO of a startup company may perform different activities and have different goals when compared to the COO of a well-established company with a large market share.

Duties and responsibilities of a COO

The typical duties and responsibilities of a COO include:

  • Drive company growth from an operational and financial perspective by working closely with the CEO, CFO and other key executive officers

  • Work with the finance team to achieve favourable financial results, create the organisation's budget, prepare performance reports and monitor banking and accounting processes

  • Set challenging and practical goals for improving the growth, performance and profitability of a company

  • Work closely with the management team to design, implement and roll out plans for internal infrastructures, operational processes, reporting systems and company policies with an aim to foster growth, profitability and productivity within the company

  • Delegate responsibilities to ensure deserving team members grow in their experience and capabilities

  • Collaborate with the marketing team on initiatives and strategies to improve the growth of the company

Read more: 10 Effective Communication Skills for Career Success

Skills required for a COO

Most successful COOs have multifaceted talents and skills that enable them to adapt to different tasks and solve a range of issues. In addition to proper qualifications and extensive work experience, a successful COO also possesses strong and proven soft skills to manage the team and drive the company towards achieving its goals. Here are some skills required for a COO:

  • Communication: A COO requires strong communication skills as they work closely with a wide range of individuals, ranging from employees to other executive members. They possess excellent interpersonal and negotiation skills that are necessary to perform their job efficiently.

  • Decision-making skills: To become a successful COO, you require strong decision-making skills. It can help you consider a range of options, anticipate outcomes and take decisions that positively affect the organisation.

  • Leadership: A COO requires outstanding leadership skills, sharp business acumen and the ability to manage a multidisciplinary team effectively. You're also responsible for leading and motivating employees to optimise their effectiveness and performance.

  • Innovation and strategic thinking: A COO adopts and applies innovative methods for the strategic growth and development of the organisation. You can also develop the ability to think strategically with with solid financial and business acumen.

  • Delegation: Good leadership requires the ability to delegate tasks effectively. This ensures that all the teams perform their activities effectively.

  • Organisation: You may need to delegate several tasks and activities and manage the operations of several departments that are under you. This requires good organisational skills to help you stay focussed on different tasks and use your energy and time efficiently and effectively to achieve the desired outcome.

Read more: 10 Leadership Skills To Highlight In Your Resume

How to become a COO

A career as a COO is a fulfilling and highly rewarding career option. Here are some steps on how to become a COO:

1. Earn a bachelor's degree

The first step towards building a career as a COO is to get a bachelor's degree in related fields such as economics, business administration, law or liberal arts. It's also a good idea to pursue a degree in a field related to the industry where you wish to work.

2. Study for a master's degree

Studying for a master's degree, such as an MBA, is a standard prerequisite for several executive-level positions. Earning this advanced degree prepares you to understand all the elements of a business which is critical to becoming an outstanding leader. If your first degree is not related to business studies, an MBA or a related master's degree can provide you with the fundamental business principles essential to this role.

3. Build your work experience

Once you've gained a good education, the next step would be to obtain work experience to build your career. Employers frequently require a significant amount of prior work experience, often about 10 or 15 years, as a requirement for the COO position. This slow build helps prepare a COO for their challenging role and it's also an excellent way to learn the best business practices, management skills and leadership qualities needed to build a solid foundation.

Having several years of experience can help you understand the typical responsibilities and environment of the job. It also provides opportunities to learn and develop the skills required for this profession through practical experience.

4. Continue your learning and development

Focus on building yourself as an effective leader, a decision-maker and a strategic thinker with high-level organisational skills. As a COO, you can invest in continuous learning and development to grow professionally. Discussing with mentors, learning from peers, enrolling in courses and practising new skills are some ways a COO can build their knowledge and skill.

Read more: What Does an Executive Assistant Do? (With How To Become One)

Average salary of a COO

Being a COO is a challenging yet rewarding position. On average, a COO can earn about $214,941 per year. Their salary also depends on a number of other factors, such as the size of the company and the qualifications and work experience of a candidate.

Read more: 50 of the Highest Paying Jobs You Can Apply For

Frequently asked questions

Here are some frequently asked questions about being a COO:

What is the work environment of the chief operating officer?

COOs and other executives work in every type of organisation and for companies of all sizes. They often work full-time and sometimes they may even work extra hours to ensure the business runs smoothly. Their responsibilities are challenging yet rewarding because of their importance in an organisation.

Often, they spend a lot of time travelling to national and international offices and taking part in various meetings and conferences across the world. In addition, they work closely with other C-suite executives and department heads to manage the operations of the company effectively.

Is COO higher than CFO?

The COO is often the second-highest executive rank after the CEO. They oversee the different business operations, which may include production, marketing, human resources, research and development and other functions. On the other hand, the chief financial officer (CFO) oversees the finances of a company. A CFO manages the budget, analyses financial data, monitors cost and prepares reports with the financial performance.

What's the difference between a CEO and a COO?

A chief executive officer (CEO) is the highest-ranking executive in an organisation. A COO is the second-highest-ranking executive official who reports directly to the COO. The COO oversees the execution of the vision and mission set by the CEO and board of directors. In addition, they manage the overall business operation of the different departments and oversee the day-to-day administrative operations of a company. As the second in command, the COO is typically next in line for the CEO position.

Salary figures reflect data listed on Indeed Salaries at time of writing. Salaries may vary depending on the hiring organisation and a candidate's experience, academic background and location.

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