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Any operations leader should be able to demonstrate a number of core capabilities, but what do budding chief operating officers (COOs) really need to reach the C-suite?
According to a new report by EY titled ‘Aiming from the top – a guide for aspiring COOs and their organisations’, there are a number of stand-out characteristics HR should be looking for when recruiting for this all-important role.
More than most other executive positions, the scope of a COO’s role can vary widely from one industry to the next and, while there are a number of possible skills needed, COOs themselves believe these are the core elements they need to demonstrate.
This includes being a mastery of change (63%), engaging in strategic board-level discussions (60%), setting and enforcing robust operational controls (58%), designing and implementing the organisation’s operational model (55%), proficiency in identifying and extracting efficiencies (52%), deep industry and market knowledge (52%), finding a multicultural management approach (51%).
However, the report states, these capabilities alone are not enough to provide a ticket to the C-suite.
According to in-depth interviews conducted for this report, these six ‘X factor’ capabilities stood out as key skills to set the best COO candidates apart from the rest.
1. Interdepartmental knowledge
A COO needs to bring both depth and breadth to the table.
“They must do all that is possible to build a career that involves close exposure to different parts of the business,” the report states. “Once they reach the top, COOs will have direct oversight of a broad swath of functions. Their ability to cope will depend on the degree of insight they have into each.”
2. International experience
Having a global mindset is one thing, but knowing how to identify and “exploit” those overseas experiences back home is another.
“The aim is not merely to bring a global mindset to the table, but to actively seek out and take advantage of leading practices from every corner of the world,” the report noted. “This could be uncovering new frugal innovations from a rapid-growth market, or finding a wholly new operational model that is not yet deployed globally.”
3. Leadership skills
This might be one of the most important skills, as 87% of COOs cite strong leadership qualities as the most crucial attribute needed to do their job well.Walter Lynch, president and COO of regulated operations at American Water, told EY researchers strong leadership should foster innovation.
“I have a rule with our people that you’re supposed to take the blame, and give the credit. So if something goes wrong, they are encouraged to take the blame and go back and figure out how to fix it so that it doesn’t happen again,” he said.
“I think it fundamentally creates an atmosphere where people can take some risks, they can fail, and we can use those as key learnings, to better our performance.”
The need to constantly adapt is necessary for someone in a role which pulls them in all directions. “When the company’s Plan A doesn’t work out as hoped, the COO needs to be the person who already has a Plan B in mind,” said the report.
COOs need to be willing to move into new areas of the business and to thrive on the challenge of making that work. Agility is a crucial skill.
It’s a less tangible quality, but the ability to step up to a challenge is usually a factor in the careers of those who have risen right to the top.
COOs need to get out of their comfort zones, stop their careers from becoming stale, take on the biggest challenges they can find and take on new responsibilities.
The social and political dimension to a senior executive position such as this cannot be avoided, so the ability to master this networking with peers across the business and beyond is imperative.
“When you think about the scope of a COO’s responsibilities, they really need to reach out and convince everybody, so it necessitates a person who can negotiate that,” James Fernandez, Tiffany & Co.’s COO told EY.
This goes beyond the need for a solid contact book and lots of high level networking. COOs need to be approachable and have top interpersonal skills allowing them to navigate any internal politics.