When Larry Ellison, founder and CEO of Oracle, and his chief operating officer, Ray Lane, parted ways in 2000, the event inspired the kind of breathless reporting usually reserved for celebrity divorces. Forbes.com reporter David Einstein wondered in print, “Did Lane quit or was he fired?” and wished he had “a clue as to why Ellison’s second banana for the past eight years suddenly was cleaning out his office.” Soon afterward, CNET News.com weighed in with this: “The story of Lane’s plight at one of the most powerful companies in technology is one of hubris, greed, betrayal and personal epiphany…” Readers were left with two puzzles to sort out. First: why Lane was leaving his position, given what seemed to be an unbroken string of admirable achievements. And second: why the event was wrapped in such drama. Executives change posts all the time, yet the story, with its hints of palace intrigue and titanic clashes, was inherently captivating.
Second in Command: The Misunderstood Role of the Chief Operating Officer
Asking the question, “What makes a great COO?” is akin to asking “What makes a great candidate for U.S. vice president?” It all depends on the first name on the ticket—the CEO.
New research sheds light on this most contingent, and most mysterious, of C-suite jobs. After in-depth conversations with dozens of executives who have held the position and with CEOs who have worked with COOs, the authors have concluded that different views of the COO role arise from the different motives behind creating the position in the first place. There are seven basic reasons why companies decide to hire a COO: to implement the CEO’s strategy; to lead a particular initiative, such as a turnaround; to mentor a young, inexperienced CEO; to complement the strengths or make up for the weaknesses of the CEO; to provide a partner to the CEO; to test out a possible successor; or to stave off the defection of a highly valuable executive, particularly to a rival.
This tremendous variation implies that there is no standard set of great COO attributes, which makes finding suitable candidates difficult for companies and recruiters alike. Still, certain common success factors came up consistently in the interviews, the most important being building a high level of trust between CEO and COO. Trust comes from meeting obligations on both sides: The COO must truly support the CEO’s vision; keep ego in check; and exhibit strong execution, coaching, and coordination skills. The CEO must communicate faithfully, grant real authority and decision rights, and not stymie the COO’s career.
It’s surprising that COOs are not more common. They would be, the authors contend, if there were less confusion surrounding the role. As we continue to demystify that role, more companies will benefit from more effective leadership.
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