COO executive search

Chief operating officer is the least standard title in the C-suite. In one company it means the person who runs everything the founder does not want to, in another it is the head of delivery, in a third it is the successor being groomed, and in a fourth it is a logistics and supply-chain job. A COO search cannot start until the company has said which it means, and most have not.

The UK market charges 25 to 33 per cent of first-year salary for retained search and 15 to 25 per cent for contingency. What sits inside that number is set out openly, which is unusual in this market and deliberate.

What changes when the seat is the COO

The seat has to be defined from the founder outward

A COO exists in relation to a chief executive, and the useful definition is a list of what the chief executive will stop doing. Write it down: hiring, finance oversight, delivery, customer operations, legal and compliance, the weekly rhythm. A candidate reading that list can tell whether the job is real. A candidate reading 'partner to the CEO' cannot, and the good ones decline.

The founder relationship is the hire, and it should be tested before the offer

A COO who disagrees with the founder in private and backs them in public is the model; a COO who does neither, or does them the wrong way round, is gone within a year. The process should include working time together: a real problem the company has, worked through by the founder and the final two candidates, with somebody else watching how the disagreement goes.

Operations means something different in every sector

In a software company the COO runs the commercial engine and the internal functions. In a manufacturer or a logistics business it is plants, supply chain and safety. In professional services it is utilisation and delivery. A candidate who was an excellent COO in one is often unqualified in another, and sector should be a hard filter here where it is a soft one for finance or marketing.

Succession is often the unspoken brief

Boards hire COOs as future chief executives more often than they say so, and candidates know it. If succession is part of the intention, say so to the final candidates and to the current chief executive, because a COO hired as a successor who was never told is a resignation waiting to happen, and a founder who did not agree to it is a worse one.

The process, where it differs

Define the seat

A written list of what the chief executive stops doing, agreed with the board, before approaches begin.

Map

COOs and general managers in the same operating model, which is a tighter filter than sector alone, plus chief-of-staff and divisional leaders ready for the step.

Approach

With the definition of the seat attached. COO candidates have seen too many undefined versions to take a vague one seriously.

Assess

A working session with the founder on a live problem, observed; references from a chief executive the candidate has worked under; a conversation about succession if it is in play.

Title, remit and reporting lines written into the offer, so the seat does not shrink in the first quarter.

What to ask a search firm

Which kind of COO is this, and have you written down what the chief executive will hand over?
How do you test the founder relationship before an offer?
Is succession part of the brief, and who knows that?
How tightly do you filter by operating model rather than sector?
What has happened to the COOs you placed two years ago?

Where it goes wrong

Briefing 'partner to the CEO' with no list of what that means
Testing the founder relationship for the first time after the start date
Hiring a software COO into a plant, or a plant COO into software
Leaving succession unspoken when everybody in the room is thinking it
Letting the remit shrink in the first quarter because it was never written down

When a search is the wrong instrument

A founder who needs the operating rhythm built, the hiring plan run and the board pack produced, two or three days a week, does not yet have a full-time chief operating officer's job; a fractional COO builds the machine and hands it to the permanent hire when the company is large enough to need one all week. Hiring full-time first often hires the person to design a job that does not exist yet.

Common questions

How long does a COO search take?

Twelve to sixteen weeks to an accepted offer, longer than most seats because the definition work at the start takes time and because candidates do more diligence on the founder than for any other role. Notice periods for sitting UK COOs run three to six months.

What does a COO executive search cost in the UK?

25 to 33 per cent of first-year earnings for a retained search is the UK market, on a base that for a scale-up COO usually sits between the CMO's and the CFO's. Contingency work at 15 to 25 per cent rarely reaches sitting COOs, who are not reading adverts.

Does every company need a COO?

No. Companies with a strong finance leader, a head of people and a delivery lead often do not, and the title is sometimes created to solve a founder's workload rather than an organisational need. If the list of what the chief executive would hand over is short, hire those functions directly instead.

What is the difference between a COO and an operations director?

In UK usage an operations director runs a defined function, delivery or production or customer operations, and reports to the chief executive or the COO. A COO runs several functions and shares the running of the company with the chief executive. The salary, the equity and the candidates differ accordingly.

Two ways in

Permanent, or the part-time version first

Retained search runs a full-time appointment end to end. Operator Search answers the same brief fractionally in five business days, which is usually the faster way to find out whether the seat is real. Or browse the bench and approach somebody direct at no cost.

How to Hire a COO: Defining the Seat, Process and CostWhy the COO seat has to be defined from the founder outward, the four kinds of COO, how to test the working relationship before an offer, and the loaded cost of the hire.