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Why Your Business Needs a Chief Operating Officer

If nobody knows more about pizza than you, you might open a pizza shop. Or maybe you’re an expert in immigration law, so you open a law office. Or maybe you’re LeBron James and you’re great at basketball. No matter whether your field of expertise is pizza, law, or tomahawk dunks, none of that knowledge means mean you know how to run a business.

And most of the boring inner-workings of running a business can cloud your unique vision for the future of your company. That’s why you should considering pairing with someone who has lived and breathed small-business operations across a range of industries for years. It’s a powerful combination to have an outsourced chief operating officer at your side.

The COO has fallen out of favor of late in part because there is a lack of understanding about what a COO does, and partly because of the power dynamic that sometimes causes conflict between the COO and CEO.

Having a COO who’s gunning for your job isn’t the healthiest scenario. But by outsourcing your COO, you never have to worry about that. The outsourced COO only succeeds by helping you keep the throne of your rapidly expanding kingdom.

The COO has fallen out of favor of late in part because there is a lack of understanding about what a COO does . . .

The COO’s job description is difficult to define because it changes from company to company and CEO to CEO. That’s also its strength. It’s malleable to your needs. It can be whatever you want it to be. Generally, though, a COO’s role is a mix of strategy and execution, with the overarching purpose of keeping “the business end” of the business running smoothly while assisting the CEO in refining and realizing her vision.

The strategy dimension of the COO’s job lies in working with the CEO to draft an operational road map for how the business is going to grow from where it stands today, even if it’s still nothing more than an idea. The COO helps you deliver your product to your first customer, helps grow a strong customer base, and helps realize the thriving enterprise you envision.

This kind of operations strategy is a critical and complex part of making any business work, and getting it right is a specialized skill. The largest and most successful companies in the world spend millions of dollars hiring consulting firms because even big companies with tons of internal expertise need help seeing the best way forward.

That outside perspective can help awaken you to new ideas. Plus, operations experts typically have worked with many companies across a range of industries, and have developed insight that would be impossible to achieve internally at one organization.

That’s the kind of strategic expertise you bring aboard with an outsourced COO.

After the strategy comes the execution. The COO helps push the plan into action, from devising workflow to delegating the multitude of tasks that need to get done to the one-time slog of building the company’s infrastructure to the repetitive tasks of executing the business model on a daily basis.

How much your COO should focus on strategy versus execution depends on your needs.

We assist a lot of small-business owners at Agents of Efficiency, which is the company I founded with the express purpose of helping them do all the boring — but essential — duties they need to be free of to focus on the core operations. We’ve learned that most small businesses need the COO to maintain a different mix of responsibilities at different times.

Your typical solopreneur who’s just started doesn’t need a ton of help with execution because the enterprise is too small and there’s not much to execute. But she could really use an expert advisor to help her think through strategy. Over time, the COO’s job evolves into execution. The larger the business becomes, the more moving parts there are, and the more people the COO must manage in order to execute the business model.

While the COO’s job description depends in part on timing, the company, and the CEO, some things remain constant. It’s critical that the COO is a seasoned professional who acts as the CEO’s key advisor in business operations because the CEO’s expertise is in the business itself — pizza, law, tomahawk dunks, whatever — not in operations.

LeBron focuses on basketball and works with a coach to help him excel the same way a CEO should be focused on the core business while the COO helps execute it.

If you want a little help seeing clearly just what work you have on your plate right now – and what you could take off your plate – feel free to use our Digital Value Grouping Tool to help you sort through all the hats you’re currently wearing.