Musical Chairs?
The trend in boardrooms is to nix a seat--COO.
Where did the COO go? It's a question you might ask looking
at today's organizational charts.
In 1999, there were 249 COOs at large, publicly traded
companies; by 2005, the number had dropped to 204, according to
Crist Associates, a Hinsdale, Illinois, recruiting and succession
planning firm. General Motors, IBM, Motorola and Procter &
Gamble have all nixed the COO position in the past few years.
The COO is a casualty of changing corporate pecking orders. CEOs
feel growing pressure from Wall Street to understand all aspects of
their businesses, so they're leaning heavily on CFOs and
shedding COOs to get closer to the action. The result: "The
CFO's status is elevated from a finance person to a strategic
partner," says Scott Simmons, vice president of Crist
Associates.
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COOs also face stiffer competition from other executives for
promotions. CEOs "might feel they've got good potential
successors in executives [other than the COO]," says Scott
Kingdom, global managing director of industrial markets for
Korn/Ferry International in Chicago.
Tweaks go past the top three jobs. Some companies are adding
chief experience officers, who keep top-level managers on the same
page in crafting customer experiences. Chief information officers,
meanwhile, are actively creating business strategy instead of
solely managing IT.
Changing your organizational chart, however, puts pressure on
other executives to pick up the slack. "Surround yourself with
smart people," Simmons says. "But make sure you know
what's going on inside and outside your company."