Feb 18 min read

The CEO's Playbook: Questions for COOs to Drive Business Excellence

January traditionally marks a low in productivity for businesses, largely due to the post-holiday season slump, chilly weather, and a renewed emphasis on personal well-being (Ringel, 2023). Now that February has arrived, it's an opportune moment to focus on the potential achievements of 2024. As such, this insight article delves into into the critical questions CEOs should pose to their COOs to enhance operational efficiency and realize business goals.

By integrating these questions into executive coaching sessions, Executives can guide their clients towards making informed, data-driven choices. This approach helps in pinpointing and addressing potential obstacles, thereby facilitating corrective measures. Such strategic engagement is key to ensuring long-term success and fostering sustainable business growth.

The role of a COO

To understand the questions a CEO should ask their COO, we must first understand what a COO is responsible for. The role of the COO is multifaceted and requires a balance of strategic vision and practical operational expertise. The role involves not just managing the present but also preparing the organization for the future, navigating complex challenges, and seizing opportunities in a rapidly changing business environment.

In a Harvard Business Review article titled "Second in Command: The Misunderstood Role of the Chief Operating Officer" by Nathan Bennett and Stephen A. Miles, the complex and varied role of the Chief Operating Officer (COO) in organizations is explored. It outlines how the COO's role differs significantly across companies, primarily due to its dependence on the CEO's needs and the company's strategic goals. The authors identify seven distinct roles a COO might play:

Executor: Focuses on executing strategies developed by the CEO and senior management, ensuring operational excellence throughout the organization.
Change Agent: Tasked with driving significant organizational change, handling transformations such as turnaround efforts or corporate restructurings.
Mentor: Primarily serves to provide guidance and development to the company's senior managers, often stepping into the COO role with extensive experience.
Other Half: Complements the CEO's skills and qualities, often taking on areas the CEO may lack interest in or expertise.
Partner: Works in close collaboration with the CEO, sharing duties almost equally and acting as a confidante and advisor.
Heir Apparent: Positioned as the COO to prepare for eventually taking over the CEO's role, using the position as a training ground.
MVP: Promoted from within to the COO role due to their exceptional performance and critical role in the company's success, securing key talent. (Bennett, 2006).

Questions to ask

Given the unique combination of the CEO's leadership style, operational needs of the company, and overarching strategic goals, the COO's role is inherently versatile, aimed at bridging leadership gaps, navigating complex operational challenges, and adapting to the evolving requirements of the business to ensure strategic objectives are met with efficiency and effectiveness. COOs tackle a broad spectrum of responsibilities, from operational execution to strategic planning, underscoring their critical role in aligning company operations with its strategic vision.

Questions directed at understanding the current operational state, identifying challenges and opportunities, assessing the effectiveness of processes, and leveraging technology for competitive advantage, are crucial. Continue reading for 10 questions that not only shed light on the operational health and direction of the company but also underscore the importance of continuous improvement, risk management, talent development, and interdepartmental collaboration for sustained growth and innovation.

What is the current state of the company's operations and how do they align with our overall business strategy?

Asking a COO about the current state of a company's operations and their alignment with the overall business strategy can provide valuable insights into an organization. The COO oversees day-to-day operations and can share KPIs such as revenue, profit margins, employee productivity, and customer satisfaction. They can also provide insights on challenges and opportunities in the market or industry. This information can help executives make more informed decisions, identify areas for improvement, and ensure that the company's operations are aligned with its strategic goals.

Take Tim Cook, Apple’s COO between 2007-2011 before becoming CEO, for example. Leadership at Apple has been marked by an ability to identify and seize financial opportunities, diversifying the company's offerings and driving significant growth. The launch of the Apple Watch in 2015 and AirPods in 2016 showcased Cook's vision in expanding Apple's product line into wearables, with the latter becoming a major success. He also strategically broadened the iPhone range to include both budget-friendly models like the iPhone SE and premium 'pro' models. Moreover, Cook's pivot towards subscription services such as Apple Music, Apple TV+, and Apple News+ has been a critical move, transforming Apple's revenue model. These initiatives, particularly the push into services and wearables, have become pivotal in fueling Apple's sustained growth under Cook's astute guidance.

Questions like “What is the current state of the company's operations and how do they align with our overall business strategy?” allow COOs to ponder the effectiveness and efficiency of current operational processes, assess their alignment with long-term strategic goals, and identify areas where adjustments or improvements are necessary to ensure the company's operations are fully supportive of its broader objectives (Hartmans, 2024).

What are the main challenges and opportunities facing the company's operations, and how are we addressing them?

Asking a COO about the current state of a company's operations and any challenges or opportunities they face is important to understand the overall health of an organization, identify areas for improvement, and stay ahead of competition. Challenges and opportunities could include market competition, changes in consumer behavior, operational inefficiencies, and supply chain disruptions. Addressing these challenges can involve strategies such as investing in new technology, optimizing processes, expanding into new markets, implementing cost-cutting measures, or increasing collaboration. By gaining insights into a company's operations and taking proactive steps to address challenges and capitalize on opportunities, business leaders can drive growth, improve efficiency, and ensure the long-term success of their organizations.

What are the key performance indicators we should be tracking to measure the success of our operations, and how are we doing against those metrics?

Asking a COO about key performance indicators (KPIs) to measure the success of operations is important to track progress towards strategic objectives, identify areas for improvement, and make data-driven decisions to improve operational efficiency, profitability, and customer satisfaction. Examples of KPIs could include revenue growth, profit margins, employee productivity, quality control metrics, inventory turnover, and production cycle times. Regular reporting and data analysis by the COO can help identify trends and patterns, and take corrective actions as needed to ensure long-term success and sustainable growth.

Are our operational processes and systems efficient and effective, and if not, what steps are we taking to improve them?

Asking a COO whether operational processes and systems are efficient and effective, and what steps are being taken to improve them is important to identify bottlenecks or inefficiencies, improve operational efficiency, reduce costs, increase profitability, stay competitive, and drive innovation. Inefficient processes or systems can lead to decreased quality or delivery delays, negatively impacting customer satisfaction. COO insights can include implementing new technology, optimizing processes, or increasing collaboration between departments to streamline communication and decision-making. Overall, this information is crucial for identifying areas for improvement, staying competitive, and achieving long-term success and sustainable growth.

How are we managing our inventory and supply chain to ensure we can meet customer demand while minimizing costs?

How are we leveraging technology and innovation to drive operational excellence and gain a competitive advantage?

Asking a COO how a company is leveraging technology and innovation to drive operational excellence and gain a competitive advantage is important to ensure that an organization is keeping up with technological advancements, identifying areas for innovation and growth, and staying ahead of the competition. Insights from a COO can include investments in automation, artificial intelligence, data analytics, and other innovative technologies. This information can help you overcome any barriers to adopting new technology and ensure that your organization is taking full advantage of technological advancements to drive efficiency, quality, and profitability, ultimately leading to long-term success and sustainable growth.

How are we managing and developing our talent to ensure we have the right people in the right roles to support our operations?

Asking a COO how a company is managing and developing talent is important for identifying skills gaps, fostering a culture of learning and development, attracting and retaining top talent, and achieving long-term success and sustainable growth. Insights from a COO can include strategies for assessing skills and competencies, providing training and development opportunities, and attracting and retaining top talent. This information can help overcome any barriers to managing and developing talent, such as resource availability or competition for skilled workers, ensuring that the right people are in the right roles to support operations and achieve strategic objectives.

Are we effectively managing our risks and complying with all relevant regulations and standards?

Asking a COO about whether a company is effectively managing risks and complying with all relevant regulations and standards is important for identifying potential risks, ensuring ethical and responsible operations, staying ahead of the competition, and achieving long-term success and sustainable growth. COO insights can include strategies for identifying and mitigating potential risks, implementing appropriate internal controls and processes, and ensuring compliance with relevant regulations and standards. By understanding potential challenges or barriers, strategies can be developed to overcome them and ensure that an organization is operating ethically and responsibly while managing risks effectively, ultimately leading to improved reputation, reduced financial losses, and better stakeholder engagement.

How are we collaborating and coordinating with other departments and teams to support the smooth and efficient running of our operations?

Asking a COO how a company is collaborating and coordinating with other departments and teams is important to identify communication or coordination issues, build a culture of teamwork and collaboration, stay ahead of the competition, and achieve long-term success and sustainable growth. COO insights can include strategies for improving communication and decision-making, identifying areas for collaboration, and addressing any cultural or organizational barriers. Understanding potential challenges or barriers can help develop strategies to overcome them and ensure that an organization is operating in a collaborative and efficient manner, ultimately leading to improved productivity, customer service, and decision-making.

What initiatives and projects are we currently working on to improve and grow our operations, and how are we tracking against our goals for these efforts?

Asking a COO about the initiatives and projects a company is working on to improve and grow operations is important to understand the strategic direction of your organization, track progress towards objectives, and make data-driven decisions to achieve long-term success and sustainable growth. Insights from your COO can include updates on specific KPIs, milestones achieved, and any challenges or issues encountered. By gaining a clear understanding of the priorities for improving operational efficiency and achieving growth, making necessary adjustments to stay on track, identifying potential issues or roadblocks, and taking corrective actions as needed. Ultimately, this information is crucial for staying competitive, ensuring long-term success, and achieving sustainable growth.

The main takeaway

Asking the right questions to a COO is an essential step towards ensuring that a company's operations are optimized for success. From identifying potential risks and compliance issues to fostering cross-functional collaboration, there are several important areas that business leaders should be discussing with their COO to maximize operational efficiency and achieve long-term growth.

By gaining a deep understanding of a company's strategic direction, tracking progress towards goals, and taking necessary corrective actions, leaders can stay competitive in your industry, build a high-performing team, and achieve sustainable growth. Remember, the success of a business is directly linked to the quality of operations, and asking the right questions is key to unlocking the secrets to successful operations.

In this article, we delve into the “10 Questions CEOs can ask their Chief Operating Officer to ensure the company is well managed” chapter found in Next 10: Coach Wisdom for Entrepreneurs, Business Owners, and CEOs Wondering What Moves to Make Next, a book written by the Host and Curator of Arete Coach Podcast, Severin Sorensen, with contributions from Amelia Chatterley.

References

Bennett, N., & Miles, S. A. (2006, May). Second in Command: The Misunderstood Role of the Chief Operating Officer. Harvard Business Review. https://hbr.org/2006/05/second-in-command-the-misunderstood-role-of-the-chief-operating-officer

Hartmans, A. (2024, January 13). Tim Cook’s rise to the head of Apple. Business Insider. https://www.businessinsider.com/tim-cook

Ringel, R. (2023, January 17). 4 Ideas to Beat the New Year Doldrums. Harvard Business Review. https://hbr.org/2023/01/4-ideas-to-beat-the-new-year-doldrums

Sorensen, S. (2022). Next 10: Coach Wisdom for Entrepreneurs, Business Owners, and CEOs Wondering What Moves to Make Next.