How a Fractional Chief Operating Officer Can Help Your Business Grow Sustainably
You’ve successfully launched your business and you’re growing, you’ve grown. Daily operations are full steam ahead and you and your team are busy delivering to your customers. But despite the exciting growth, you’re noticing snags. Or perhaps you’re so busy, you feel you don’t have time to plan for more strategic growth, set new benchmarks for your company, and create new roles to offset the abundance of work. It’s possible you’re noticing that the systems and processes that you initially launched with, are no longer keeping up, or are no longer robust or technologically advanced enough to keep up with demand. Congratulations! You’ve hit a milestone and you’re aware enough to know that you need to make some adjustments. It might be time to bring in a Chief Operating Officer.
A Chief Operating Officer or COO is responsible for overseeing operations and strategies in a company, often the number two to the Chief Executive Officer (CEO).
The role of COO can sometimes be a bit ambiguous or misunderstood, but typically a COO is tasked with ensuring systems/processes are smooth, carrying out operations in the company, identifying gaps, and room for improvements, and crafting strategies for long term growth.
Sometimes, COOs are tasked with rounding out a CEOs weaknesses. Often they are the executing arm to the CEOs visionary role. And, in other instances the CEO + COO might have more of a collaborative partnership. It often depends on what the CEO is looking for, and what the company needs, that will determine exactly how the COO carries out their role.
Because the role of COO can be misunderstood, it is important to point out what COOs are not. COOs are not business coaches, business managers, nor are they executive level personal assistants. Business coaches often coach CEOs around executive leadership and personal development, they generally do not have a stake in the company, nor do they have sway in business decision making. Business managers typically execute on daily, weekly, monthly tasks, as dictated by the needs and goals of leadership. Business managers aren’t responsible for developing strategies alongside the leadership team. And lastly, executive personal assistants are responsible for the calendar, appointments etc., of the CEO. Executive personal assistants are not tasked with the big picture, forward thinking strategies, responsible for scaling a company.
Per “Make Operations Your Secret Weapon” in First Round Review, “A COO helps you cover double the ground, as well as double down. She should be seen as a multiplier.”
With an eye to the future, the ability to perform big picture thinking alongside delegation and execution, COOs can be vital to a growing company. If the systems you started with no longer work, if you’re seeing weakness in developing growth strategies, it might be time to bring in a COO…or a Fractional COO.
Instead of hiring a full time, salaried COO, you might want to consider bringing in a fractional COO, who will be working part time or for a specific duration of time.
A fractional Chief Operating Officer is essentially an independent consultant, who acts a Chief Operating Officer in your company. A fractional COO will fulfill the same roles, have the same objectives as a full time, salaried Chief Operating Officer, but they’re not salaried; they’ll operate within a standard operating procedure, and work within an agreed upon contract for an agreed upon amount of time.
Fractional COOs can:
Bringing on a fractional COO provides your company with the benefits of not adding another salaried employee, but furthermore, it allows you to take your fractional COO for a test run to ensure a mutually beneficial fit. Another benefit of bringing on a fractional COO is to gain an outsider’s perspective, a fresh set of eyes on existing problems.
By bringing in an independent consultant to fulfill fractional COO duties, you’ll negotiate a contract with a clearly defined scope of project. Typically, a fractional COO will not have the same stake in a company as a full time COO. But with that trade off comes a limited contract and limited separation risk.
You and your potential fractional COO should have a clear understanding of the goals, mission of the fractional COO, the ways to measure fulfillment, the roles and duties of the fractional COO, and projected hours/duration of contract.
Should the fractional COO not fulfill their duties or not be a great fit, you are able to more easily exit the agreement than had you hired a full time COO. And should the fractional COO be an excellent fit who goes above and beyond on fulfilling their duties, you always have the option of renewing or extending your contract.
An independent consultant will bring a fresh set of eyes to your company’s existing problems and weaknesses. They’ll have an outside perspective that insiders might be lacking. They aren’t beholden to the same old ways of thinking that could be plaguing your company. With their fresh eyes, outside perspective, they can make recommendations to improve systems/processes and address weak points.
Small but mighty and growing businesses looking to scale smartly can benefit from bringing on a fractional COO. Likewise, medium sized businesses that are looking to get more strategic and refine their operations, would be wise to bring on a fractional COO. Product based businesses that need to deliver goods to customers will benefit from a fractional COO who can ensure that logistics, systems, and customer journey are operating as they should.
So how do you know if your company is ready to bring on a fractional COO? A couple of key indicators:
You’re ready to scale, but you know that your current operations will not allow your company to scale seamlessly.
You’re growing, but are lacking in human power to execute on all the pieces, round out departments, or carry out key pieces of business.
You’re hitting snags in delivery, customer experience, or internal operations.
You’re so busy delivering that you’re not able to develop strategic plans for the future.
You need help executing your vision for your company.
Knowing your company is ready for a fractional COO brings us to finding a great fit.
Finding a fractional COO that will be a great fit is critical. And in order to determine who will be a great fit, it’s important that you honestly assess your company’s needs and the CEOs style, personality, strengths and weaknesses.
Harvard Business Review points out a myriad of dynamics a COO and CEO can take on in their article “Second in Command: The Misunderstood Role of the Chief Operating Officer”.
Is the CEO looking for someone to drive change?
Someone to execute on operations or someone forward looking?
Is the CEO looking for someone to compliment her or be a bit more in contrast to her?
Once the CEO has honestly assessed their needs, personalities, strengths and weaknesses, they should consider the needs of the company and the long term vision. Because fractional COOs can come from varying backgrounds, a wide range of industries with diverse education and experience, it becomes more important to determine what qualities you are looking for in a fractional COO rather than simply seeking someone with a specific degree.
In general, a great fractional COO should be able to see the big picture, but distill that big picture down into actionable steps and executable strategies. A great fractional COO will challenge assumptions and drive change. Leadership should have trust in their fractional COO. Lastly, a great fractional COO will have follow-through.
To learn more about Open Eye’s Fractional COO Services, reach out below.
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