The Chief Operating Officer (COO) is a crucial executive team member responsible for managing a company’s day-to-day operations. The COO is typically accountable for executing the company’s business plan, managing resources, implementing policies and procedures, and ensuring they are met. Forty percent of companies had a COO in 2022—up from 32 percent in 2018—with 48 percent in the financial and energy sectors. While still responsible for taking the Chief Executive Officer’s (CEO) long-term vision and implementing organizational strategies into daily operations, the role has evolved into one accountable for driving business growth through technology and digitization.

Forty-one percent of COOs remain with a company for two years or less, so chances are you will be interviewing one to join your organization. Here are questions to help you assess a candidate’s experience, skills, and leadership abilities to ensure they are the right fit for the role of COO.

1. How have you optimized business processes and increased efficiency in your previous roles?

COOs optimize business processes and increase efficiency by focusing on streamlining workflows, reducing waste, and improving productivity. The candidate should discuss ways they have used process mapping to visualize the steps involved in a particular process to identify bottlenecks and areas of improvement. Listen to how the candidate adopted automation to reduce manual labor, minimize errors, and increase speed and standardization to establish consistent processes and procedures and reduce variability to enhance employee and customer experience. Does the candidate visit each location frequently and understand the responsibilities of each department to get an impression of how things are functioning while engaging with employees at all levels of the organization?

2. How have you used data and analytics to drive decision-making in your previous roles?

A COO’s primary responsibility is consistently analyzing data to evaluate performance to drive decision-making, forecast future trends, and optimize operational efficiency. Using various tools and metrics—financial, operational, customer, employee, and market—to collect and analyze data, COOs identify patterns and trends and make informed decisions that improve the organization’s performance and drive growth. Listen for examples of leveraging technology and data and a detailed explanation of the candidate’s analysis process. It’s critical to define excellence by outcomes, and the candidate should provide quantifiable results demonstrating their operational leadership and expertise through improved customer service and exceeding stakeholder requirements.  

3. How have you kept up with industry trends and emerging technologies?  

Keeping up with industry trends and changes is a continuous process that requires ongoing attention and effort. What industry conferences and events has the candidate attended? What industry associations and publications do they subscribe to? One of the most crucial qualities a modern COO should have is adaptability because volatility and rapid change are now the norms. Due to emerging technologies, changing consumer preferences, and shifting worker needs, businesses undergo ongoing change. Therefore, COOs should be able to quickly change course to navigate uncharted ground and adjust to shifting conditions, whether focusing on the operational side of the business or identifying new ways to generate revenue sources and foster innovation. The candidate’s response to this question will help determine their capacity to maintain agility to adapt to change.

4. How do you balance risk management and innovation to achieve business goals?

Balancing risk management and innovation requires a proactive approach and ongoing attention. COOs must clearly understand how much risk the company is willing to take on to achieve its goals. Once the risk tolerance is established, COOs develop a risk management plan outlining the company’s steps to mitigate potential risks. This plan should identify potential risks, their likelihood of occurring, and their impact on the business. Listen to the candidate’s thoughts on how to manage risk.

At the same time, COOs are responsible for spearheading innovation. This means creating an environment where employees feel comfortable taking risks and sharing new ideas. Encouraging innovation can help the company stay ahead of its competition and achieve its goals. How has the candidate set business goals enabled by technology? Listens for signs that the candidate is open to trying new ideas on a small scale and evaluating their success before implementing them company-wide to help mitigate potential risks while allowing for innovation. Did they establish key performance indicators (KPIs) to measure the success of the company’s risk management and innovation efforts?

5. What are some ways you have increased your company’s revenue?

COOs can increase revenue by streamlining operations, improving product or service quality, expanding into new markets, developing new products or services, or forming strategic partnerships. A candidate with the skills, experience, and mindset to drive revenue growth can bring significant value to your organization through increased profitability, enhanced competitiveness, and improved brand reputation. Listen for concrete examples, backed with data, of how the candidate has helped their current company to become more efficient, effective, and competitive in the industry, ultimately increasing revenue and profits.

6. How do you energize the workforce to enhance productivity?

Forty percent of COOs focus most on their workforce to improve resilience. A COO appreciates talent and is critical in enhancing workforce productivity by defining clear goals and objectives, developing efficient processes, providing resources and support, fostering teamwork and collaboration, and measuring and monitoring performance. By doing so, they can help to create a highly productive workforce that can drive the success and growth of the organization. Listen for examples of how the candidate has guided employees to be happy in their job, as well as effective and efficient across all areas of their organization. This can include partnering with the Chief Human Resources Officer (CHRO) or Chief People Officer (CPO) to:

  • Improve employee productivity through increased employee morale and engagement.
  • Create a safe place where employees feel valued and heard.
  • Develop training and development programs to improve operational efficiency and deliver high-quality customer service.
  • Ensure employee satisfaction and create a great organizational culture.

Summary

The skills and qualifications required for a COO may vary depending on your organization’s industry, size, and complexity. “Rather than possessing a single set of skills that can be easily identified in any business, COOs have to adapt, chameleon-like, to the environment in which they find themselves,” states Ernst & Young. When interviewing COO candidates, ask questions to ensure they are adaptable and possess the analytical and relationship-building skills your organization requires.

This blog was authored by Pete Petrella.