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Delivering the strategy: The COO agenda

Nov 14, 2024 | Public | 0 comments

We’ve all heard someone say that something is “on” or “part of” the COO agenda. But all too often, what that means is unclear. Indeed, in a recent roundtable discussion, few COOs said that they had taken the time to think through and define their agenda.

Part of the reason lies in how people become COOs. Most move into the role from a closely related operations position, making the transition feel less like a change than moving between functions.

Before starting in a COO role, the new incumbent needs to answer two simple but critical questions:

  • Why do we, the organization, have a COO?
  • Why am I, specifically, in the role?

Understanding the context of the role is important, particularly the scope and the situation. The scope varies by organization and industry. It could encompass overall responsibility for primary or core operations, as is often seen in heavy industries such as mining or transportation. In financial institutions or holding companies, by contrast, the COO might be responsible for business support functions, such as HR or back-office processes. In other organizations, the COO’s role is akin to that of a president, overseeing business units.

The situation refers to factors in the overall business—or market—driving what needs to happen in operations. A particular business may be undergoing significant transformation, for example, or a period of recovery. At one major retailer, the COO role was established to lead the operations until a designated successor gained more experience and was ready to move into a senior executive role.

The COO must then understand why they, themselves, are in the role. It could be because of a specific skill set or linked to the overall situation, such as Industry 4.0 expertise in the case of digital transformation. Given that more than 25 percent of Fortune 500 CEOs came from the COO role, it could also relate to succession planning.

A particular COO may be selected to balance the strengths of another executive, such as the agribusiness COO whose detailed operational expertise provided a counterweight to a strategic, visionary CEO. The combination helped the company reach new levels of operational excellence.

The scope and situation illustrate another important point: the COO role is much more than an extension of what the individual was doing before. The job is not just being a “super site manager” who now oversees multiple sites. It is a true C-level role, with a broader view and often new responsibilities.

Seeing what drives value

The COO must be crystal clear on what creates distinctive value for the company—hint: it probably isn’t just low cost—while understanding what the strategy means, how operations drives the strategy, and which operational sensitivities will determine the outcomes.

Connecting the cascade of drivers to strategic objectives is essential. A logistics company launched a portfolio of operations initiatives but found that even the most wildly successful ones had little impact on overall results. A mining company worked to raise the performance of individual sites until all showed “green,” only to discover that company-wide operational performance remained “red.” In both cases, the linkages between the overall strategy and operations initiatives were broken—a gap that the COO is best positioned to fill, leading to better prioritization of operations efforts and investments so that they achieve strategic outcomes.

Setting the COO agenda

The COO agenda guides COO actions, tests whether investments are being made in the right places, withstands day-to-day firefighting, and helps the COO focus on “COO-only” topics. The core elements of a COO agenda vary by company and context, but in general, the primary elements include:

  • Vision. Our research found that only 22 percent of employees believe that their leaders have a clear direction for the organization, understand the strategic mandate, and create one if it does not exist.
  • Plan and execution. While this step—the “how” of making the vision real—includes near-term operational excellence, it also looks anywhere from six months to three years ahead with a portfolio of initiatives designed for each time frame.
  • Stakeholder engagement. One COO we interviewed defined operational excellence as “a full appreciation of the complete set of stakeholders and what their requirements are, including customer, board, public, and employees.” This is a clear COO-only topic, essential to leading operations supporting the business strategy.
  • Organization and talent. The COO role is not about running the operation but leading and enabling the operations organization. Experienced COOs have told us to ensure that “the team is in control” and to “find the best team and lean on them.” The COO is responsible for creating the most capable operations organization, including succession planning.
  • Personal operating model. The COO role and its responsibilities differ from previous roles and vary from organization to organization. COOs need to manage how they spend their time and attention, lead, and interact with stakeholders.

These elements will help a COO forge a proactive agenda, make decisions, and prioritize tasks. The perspectives and expectations of core stakeholders—investors, CEOs, and other C-suite executives—should also guide the COO agenda.

The COO vision begins with the overall business strategy

An effective operations vision clearly articulates the plan for success and serves as the “true north” for employees across the organization working toward shared goals. To successfully craft the vision and execution plan for operations, the COO must understand the overall business strategy, how operations will drive that strategy, and the role they, as the COO, play in delivering it.

An enterprise-wide mandate, such as a transformation, business recovery, or shift to digital, can largely shape a COO’s vision. Clearly communicating this vision so that all operators—including those on the front line—can understand and repeat it is crucial. High levels of ownership and buy-in among this group of stakeholders increase the odds of success. If the vision is too complex or fails to resonate among employees, there is little chance of inspiring action.

An effective vision must be unambiguous, with no room for alternative interpretation. At one financial services company, the vision was expressed as the share of clients engaging through a new channel by the end of the following year. The operational vision of a logistics company was expressed as achieving a consistent capacity above a forecast volume without additional capital investment. There are also times when a qualitative vision and statement of a “leader’s intent” are required. At one transportation provider, the vision entailed achieving a service level that matched its top-performing alternative—but at a lower customer cost.

A robust plan and effective execution are essential to make the vision a reality

A vision without a plan is simply a wish. Time flies, and a host of distractions will hinder progress. A solid plan intertwined with the vision to drive coordinated actions and track progress is essential for moving forward.

There is nothing magic about the concept of “100 days” and no need to adopt a 100-day plan, but stakeholders expect the COO to act in the near term. The COO’s vision also needs a long-term horizon and a plan to match, albeit with appropriate granular detail.

To build a robust plan, COOs should assess and act across five areas:

  1. Operations. What is the current performance and capability? Is the operation aligned with the vision? If not, what will that take to achieve?
  2. Stakeholders. What are the expectations of the CEO, chief experience officers (CXOs), boardroom, employees, customers, and other stakeholders?
  3. Culture. What is the organization’s culture, and are there changes needed? If so, how can I influence those changes?
  4. Team. Are the right team members in the right roles? Does the organizational structure support the operational requirements, particularly regarding the vision?
  5. Themselves. What are my strengths? What are my weaknesses? Am I meeting all the requirements of my role?

By ensuring a thorough understanding across these five areas, the COO can quickly identify and prioritize gaps or challenges, enabling them to act quickly where clear change is necessary. As COOs create and act on a plan, they need a portfolio of initiatives that include the desired impact, challenges to overcome, and a time frame for action. For longer-term initiatives, COOs can implement plans that yield benefits in six months, a year, or longer. As one COO stated in a recent interview, “Time is your friend; invest in capabilities.”

With a clear vision and plan in place, a COO is well-positioned to execute effectively on the business strategy. If running the core of the operation lies within their mandate, the COO also owns operational excellence and will be deeply involved in aligning the company’s operational technology, technical systems, management systems, and organizational principles and behaviors with its purpose and strategy.

“Technical systems” refers to the people, processes, tools, and materials needed to execute the operation. As the one overseeing the nuts and bolts of the operation, the COO must ensure all parts work together to enable the business to deliver on its strategy. This includes not only the “hard” elements of operations, such as equipment, inventory, and logistics, but also elements like data management, digital enablement, and analytics.

Management systems represent the mechanism for COOs and their teams to monitor and orchestrate operations. COOs need a clear view of the drivers behind desired outcomes, enabling them to monitor and question top-level metrics, as well as the ability to dig deeper into the root drivers.

Organizational principles and behaviors are equally important. The COO has to set the tone while staying close to the pulse of the culture. The Gemba walk—a classic lean management concept where leaders spend time with employees to see how the work is done—provides a powerful platform to engage with the front line.

Effectively engaging stakeholders

A COO plays a pivotal role in building relationships for their organization. Fostering connections that last requires care and consideration.

In modern business, no single element acts alone. As a result, the role and importance of stakeholders have continued to increase. Nowhere is this truer than for the COO. In this role, the COO must look beyond the operation internally and externally and foster productive relationships with a broad group of stakeholders. To do so requires a thorough understanding of and a deliberate approach to each stakeholder’s objectives, incentives, and expectations.

A COO interacts with a broad set of important stakeholders, both internal and external. Each is unique and can often have competing demands that a COO must balance and manage. Several COOs we interviewed stated that they were unprepared for the increased demands of stakeholder engagement and advised new COOs to prepare.

Key internal stakeholders include the following:

The CEO. The CEO is the most proximate stakeholder, and it is essential to understand the working relationship and expectations. The COO must clearly understand why their role exists in the organization, how the CEO perceives that role, and how best to work together. Often, a COO is selected to complement the CEO’s working style.

The COO should understand how to collaborate with the CEO effectively. For example: What decisions should the COO take autonomously? What type and depth of information does the CEO want and need for decisions and reassurance? What issues need to be escalated, and how?

The C-suite. Nearly all executives we interviewed agreed that increased cross-functional engagement is critical to COO success. The COO is uniquely positioned to help familiarize other C-suite executives with a business’s operations, particularly if those executives have come from another industry. This, however, requires the COO to communicate the “full operational picture,” as one COO described it, including the long-term implications of decisions and investments. Another COO cautioned, “While it is important to teach other leaders about operations, you must also learn to speak their language.” Taking the time to understand others’ objectives and challenges will pay dividends toward fostering genuine collaboration and avoiding disagreements. Among the key C-suite stakeholders are the following:

  • The CFO. There is tremendous opportunity in closely aligning with the CFO, especially on planning, budgeting, and top-of-mind investor issues such as working capital, large capital expenditures, and productivity. The COO, like the CFO, has a bird’s-eye view of cross-business and cross-functional opportunities. The two can educate each other on best practices in procurement, for example, and even share talent on key short-term projects.
  • The CMO. COOs we interviewed noted that the relationship with sales and marketing is particularly important. Operations leaders must thoroughly understand the customer value proposition and what it will take for operations to deliver on it. Furthermore, successful collaboration between marketing and operations functions can help deliver a better customer experience, increasing satisfaction and loyalty.
  • The CIO. Technology is at the heart of how we do business today, and the relationship between the COO and CIO, as well as other digital and data leaders, is essential to ensure that operations sees the right return on its investments. Technology investment and deployment present unique opportunities to transform businesses, but this requires deep partnership. For example, daily operations produce an enormous amount of data that, when collaboratively governed and managed, can yield insights that unlock the next S-curve of impact.

The board. Board engagement is one area where many COOs expressed dissatisfaction, with some describing board interactions as “scripted presentations.” The best CEOs use the collective experience of the entire board to help solve problems or give advice. Several COOs encouraged seeking this kind of relationship, ensuring that their exposure to and engagement with the board consisted of focused meetings and problem-solving sessions versus presentations.

Key external stakeholders include the following:

Regulators, suppliers, organized labor, investors, and others are important, but the final and perhaps ultimate external stakeholder is the customer.

The COO is the operational link to the strategy, so they should know the market. At least one executive we interviewed strongly believes that every COO, whether new to the organization or coming up from within, should have market-facing experience. This helps when collaborating with the marketing function and provides the COO the ability to factor customer experience early into any decisions.

Stakeholder engagement is a COO-only topic that is essential to operational excellence in support of the strategy. COOs who prioritize key stakeholders (for example, those with the ability to influence the success or failure of the plan) and are thoughtful in how they engage them have a far greater likelihood of success than those who don’t.

Building organizational and talent excellence

Around 70 percent of corporate transformations fail. Some of the most common reasons cited for transformation efforts that fail to achieve their full potential are related to organizational culture, mindsets, capabilities, and talent. The COO plays a critical role in ensuring the right infrastructure is in place and establishing a leadership-oversight cadence to drive mindsets and behaviors to execute the business strategy successfully.

In most organizations, the COO is not expected to run the day-to-day operations but to focus on the more strategic aspects of operations to enable the overall business strategy. For rising COOs, this can be a difficult transition; indeed, too often, it leads to failure. Successful COOs do not act as “super site managers” but rather rely on their team to handle the day-to-day. In our COO interviews, this was a recurring theme: “The team is in control,” “Find the best team and lean on them,” and “Set it [the operations] up to run without you.”

Our research found three key ways that successful COOs navigate strategy around organizational infrastructure and talent.

Ensure the right frontline leadership. Strong teams are led by strong managers. In Power to the Middle: Why Managers Hold the Keys to the Future of Work (Harvard Business Review Press, 2023), frontline (middle) managers are referred to as the “true center of the organization and its most valuable asset,” as they possess the granular knowledge, direct influence, and perspective necessary to effectively lead any operational realignments (for example, change initiatives or digital disruption).

COOs should place special focus on assessing their organization and talent. This begins by distinguishing what skills and capabilities are needed to execute the operational plan and then partnering closely with HR and senior leaders to find and develop the people accordingly. While it is important for the COO to work in close partnership with HR and other senior leaders, it is imperative that they own the outcome: the successful placement of top talent in critical roles.

Once the right team is in place, the COO should ensure they remain high-performing through capability building, performance management, mentoring, and coaching. Additionally, the COO should ensure that detailed succession planning is in place—for the COO role as well as other leadership roles in operations. However, those who do not aspire to senior leadership should not be overlooked as they are often the heroes of the operations—good managers should often be given higher-value compensation instead of being promoted out of their jobs.

Be clear about your intentions. As an operations leader, a COO should give deliberate thought to how they will lead. One effective concept is that of a leader’s intent. Adapted from the military concept of commander’s intent, leader’s intent can be incredibly effective in a distributed operation. It provides the ultimate objective, not prescriptive decisions, so that in a situation filled with ambiguity and requiring an urgent and autonomous decision, the distributed operator will make decisions that are consistent with the COO’s intent. They will not get it right 100 percent of the time, but in most situations, the operator makes the right decision (and often a decision that no one previously imagined but that has a significant positive impact).

The COO must also recognize the impact of their behaviors and actions. At one organization, for instance, leaders wanted to see a shift in focus in asset maintenance toward productivity to ensure that maintenance tasks of all sizes and scope were performed in an efficient manner. On the daily operations call, the leaders asked questions about jobs completed. In response, the team began tackling small jobs to maintain a high number of completed jobs while larger jobs were sidelined. The questions asked by leaders inadvertently drove frontline behaviors that created a maintenance “debt” across the organization’s assets, diminishing overall asset health. This example reinforces how important it is for COOs to model what is important (in other words, framing questions in a way that drives specific, intended outcomes) and provide reinforcement mechanisms, both positive and negative, for operators.

Lastly, the COO must consider how they amplify. The clear articulation of strategy is a key pillar of success, but stakeholders may find their own source of meaning through personal, company, or team success or impact on the customer or society. Therefore, COOs should amplify all of these elements to ensure that success feels shared across the organization. In fact, previous studies have shown that each of these is a common source of meaning and roughly equally distributed among the population. Few people in operations are likely to share the same source of meaning. Therefore, if the COO only communicates in terms of their own source of meaning, they are likely missing the majority of the population.

Be deliberate in how you influence. One COO described the role as being about leading change—“You have to be comfortable making people uncomfortable,” also noting, “You need to proactively manage the inertia of the organization,” calling attention to the inherent tendency of an organization to keep moving in its current or historical direction. As a change leader, the COO can deploy many influence techniques. For example, they can be an inspirational leader who convinces the organization of the value of change. They can be the expert, teaching and enabling others. They can influence through incentives, both carrots and sticks. Or they can be a role model, setting the example as an operational leader.

While each of these approaches increases the probability of success in leading change, a McKinsey study found that successful transformations were almost eight times as likely to employ all four approaches (exhibit). However, most organizations default to one technique, communications. By failing to address the other influence factors, particularly incentives and role modeling, an organization risks experiencing competing influences, which can lead to failure. For example, if a COO communicates a new way of working but does not change incentives from rewarding the previous operating model, change is unlikely.

Organizations that successfully undergo change address all four elements of the influence model.

Image description:

An illustrative model shows four puzzle pieces fitting together to represent four elements of influence addressed by organizations that undergo change successfully. The four elements are: “role modeling,” “understanding and conviction,” “confidence and skill building,” and “reinforcement with formal mechanisms.” A sentence starts above the four puzzle pieces, “I will change my mindset and behavior if…” Each puzzle piece contains text to complete the sentence, representing each of the four elements of influence from the perspective of a member of the organization. For “role modeling,” the full sentence reads: “I will change my mindset and behavior if I see my leaders, colleagues, and staff behaving differently.” For “understanding and conviction,” the full sentence reads, “I will change my mindset and behavior if I understand what is being asked of me and it makes sense.” For “confidence and skill building,” the full sentence reads, “I will change my mindset and behavior if I have the skills and opportunities to behave in the new way.” For “reinforcement with formal mechanisms,” the full sentence reads, “I will change my mindset and behavior if barriers are being removed and I’m being rewarded for making the changes I am being asked to make.”

End of image description.

Given their unique role relative to other operations leaders, a COO benefits greatly from stepping back and thinking through how best to organize their team to drive outcomes, develop the talent required, and be clear about the role they will play in leading operations.

Establishing a personal operating model

One sentiment widely shared across COOs we interviewed was that a COO’s role and expectations are different than “what got you here.” Being COO is different from other operations roles. Stakeholders are not looking for the COO to be a “super site manager” or a version of the COO’s previous role with just a larger scope. COOs are expected to hand off and delegate running the operation and focus on COO-only and strategic topics, many of which were not part of their previous role.

Using a basketball analogy, one COO describes it as the need to “lean into your left hand,” meaning to improve shooting with your nondominant hand. For the COO role, this means becoming stronger in areas outside your core expertise.

For example, in business case analysis, the COO is often the owner of pitching to the CEO or CFO for major operations investments. Reviewing, explaining, and often asking hard questions of their own staff become important skills. Another COO reflects that in his previous role, he was a great operator and site leader. However, his new COO role includes collaborating on core ERP systems and advanced manufacturing technology, requiring him to learn much more about technology quickly.

Successful COOs find a balance between running the operation and delivering strategic outcomes, but that doesn’t happen by accident. COOs need to be deliberate in establishing their personal operating model, clearly defining the role they will—and won’t—play in operations leadership. This allows them to be structured and intentional in how they spend their time and energy to ensure a focus on COO-only and strategic topics.

Be clear about the role you will play

For many COOs, this means shifting working methods to expand capacity for COO-only topics. COOs should be clear about their priorities and personal leadership focus and limit their involvement in tasks that others can deal with. Where a COO should engage will vary based on scope, situation, and mandate.

COOs should know their strengths but be honest about their limitations and strategically align talent to bridge any gaps toward delivering the vision. This can increase personal efficiency and effectiveness and create succession planning and development opportunities. Familiarity with other functional areas will serve the COO well as they look to improve collaboration.

Create an actionable plan and stick to it

COOs should have a clear view of areas that will require more of their focus and ensure the right mechanisms are in place to make it happen. For those COO-only topics, this means identifying and outlining the cadence for critical interactions. They should be clear on what data and reports they need to see, at what level, and how frequently.

In thinking through delegation, they should consider their level of involvement in delivering operational excellence and determine where direct leadership is required. For example, COOs can achieve high ROI from their time by strategically conducting site visits, both in terms of their personal learning and providing visible leadership, mentoring, and role modeling at the front line.

Lead to inspire talent and shape the culture

COOs should move beyond a vertical hierarchy and, instead, see themselves as catalysts and connectors to drive empowerment and collaboration. The result is high-performing teams, operating in a culture of trust and human connection that extends past formal structures.

Proactively manage your time and energy

COOs tell us that effective time management is a frequent challenge. Some say it is perhaps the biggest challenge of all—being able to focus on the right topics at the level of depth required. As a general rule of thumb, several COOs offer that no more than a third of their time should be spent on running the operation. The rest of their time should be spent on COO-only topics such as strategy, governance, transformation, people/talent, and organizational health.

Day-to-day firefighting can feel like a constant demand-pull for COOs. A COO who is reactive risks focusing only on the near term and making decisions based on experience, heuristics, and gut feelings. Stepping back instead and making data-based decisions with a strategic versus reactive view will help the COO stay ahead.

To maximize time spent on critical areas, COOs need to embed a steady rhythm—for example, how they manage their year/month/week, workflow, and travel schedule. This can be codified and communicated with the operations team and reinforced through the COO’s assistant. Meeting archetypes should be predefined, as should how meetings are run, including preparation expectations. Free capacity should be actively built in to protect time for long-term needs, including critical priorities and energy maximizers.

Schedule activities to prevent “energy troughs” and make room for recovery activities such as time with family and friends and exercise. COOs should be comfortable and confident in setting boundaries. This ensures they set a pace they can sustain for a marathon-length effort rather than burn out from repeated sprints.


Today’s most effective COOs have a defined agenda that is aligned with the overall business strategy, focusing on how operations can drive that strategy and what role they will play in delivering results. The COO agenda lays out the operational vision of an effective organization, clearly articulates a plan for success, and serves as a North Star for employees working together toward shared goals.

Successful COOs drive effective collaboration and engagement with all key stakeholders to fully drive their agenda and deliver the business strategy. They are inspirational leaders and role models who are also methodical in building a team to which they can delegate day-to-day operations, allowing them to focus on COO-only topics and determine where and how to spend their time best to deliver the highest impact for the organization.

The post "Delivering the strategy: The COO agenda" appeared first on McKinsey Insights

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