Expanding on the COO Imperative: Leading with Technology

Nov 20, 2023 | Technology

The role of the Chief Operating Officer (COO) is in a state of dynamic evolution, fueled by the seismic shifts brought about by the pandemic, logistical challenges, and rising oil prices. The landscape of business operations, supply chains, and customer expectations has undergone significant transformation.

COOs are no longer confined to the traditional roles of operations. The role was once predominantly an overseer of internal operations. They have now emerged as architects of corporate strategy and change agents for a more resilient, agile, and purpose-driven future.

They now have an unprecedented opportunity and, some would argue, an obligation, to be the primary architects of a corporate strategy. As customer expectations evolve rapidly, operations are becoming increasingly digitized.

As a result, a direct and potent link has emerged between customers and the COO. This has enhanced the COO’s status in reshaping global competitiveness through agile operations and supply chains.

Harnessing Data & Technology Insights

The relationship between businesses and customers is increasingly technology-driven. Today’s customers leave a digital footprint in various forms, from browsing history to purchase behaviors. These digital interfaces are valuable sources of real-time customer insights.

COOs, given their oversight of operational data and company cultures, have a unique vantage point into these insights. They can harness this data to understand customer wants and behaviors better. However, the challenge is not just accumulating data but making it actionable.

The integration of data analytics is crucial. COOs can collaborate with their counterparts in the technology department for this. This includes:

  • Collaboration with the Chief Executive Officer,
  • The Chief Information Officer (CIO), and
  • Chief Technology Officer (CTO), to derive actionable insights from the wealth of data within their domain.

Operational Control & Strategic Response

The COO’s purview extends to the operational heart of the organization. With control over flexible manufacturing and agile systems, they are ideally situated to provide a strategic response to competitor moves or market shifts. It’s crucial to recognize that operational agility and strategic thinking go hand in hand.

Moreover, COOs understand the risks associated with operations, including cross-border activities like supply chains and exports. This makes them valuable contributors to strategic planning, especially regarding trade, a cornerstone of sustainable growth strategies. They are uniquely positioned to address challenges such as geopolitical risks, trade barriers, and sovereignty rules.

Data-Driven Perspective

The COO’s oversight also extends to the majority of data generated within their domain, encompassing production statistics, product performance, and customer fulfillment. Working closely with the technology team, COOs can gain a deep data-driven perspective on the enterprise. This perspective is instrumental in shaping a company’s strategic response to market shifts.

In essence, the COO, driven by technology and data, becomes a central figure in shaping the strategic direction of the organization. This shift from a purely operational role to a key strategist marks a new era in the COO’s journey.

Embracing Customer-Centricity

The role of the COO is no longer limited to internal processes. It has expanded to encompass a pivotal aspect of business – customer relationships. This shift towards customer-centricity is driven by several factors.

Changing Customer Expectations

In today’s inflation-prone world, customers have evolved. Online channels have elevated their expectations for product availability and delivery times. They now demand solutions customized to their specific needs. This shift has placed a significant burden on businesses to adapt quickly. This, in turn, has increased the pressure on COOs. Technology implementation is crucial to meet this demand.

Technology-Driven Relationships

The pandemic accelerated the adoption of technologies such as the Internet of Things (IoT) and flexible manufacturing. These innovations enable production teams to offer customized products with swift turnaround times.

The embedding of sensors into products and services has created a real-time flow of customer information. COOs are now in a position to actively collaborate with sales and marketing teams to address customer needs.

This change in the division of labor is transformative. While traditional roles relegated customer relationships to sales and marketing, COOs now find themselves at the center of the customer experience. They play an active role in understanding and catering to customer demands. In essence, COOs have transitioned from being operationally focused to becoming integral to the customer-centric transformation.

Operational Agility for Market Leadership

Operational agility, often considered the domain of engineers, has emerged as the cornerstone of a company’s competitive edge. The ability to pivot quickly and efficiently is no longer a nice-to-have; it’s a necessity.

Rapid Response

Traditional manufacturing and retailing have been characterized by significant lead times. For instance, it might take weeks to respond to a customer’s request or forecast product lines several quarters ahead. This leads to companies being reactive, struggling to keep up with market dynamics rather than setting the pace.

Operational excellence can now be leveraged proactively to create a competitive advantage. The key to achieving this is agility.

Direct Feedback Loop to Customers

COOs can establish a direct feedback loop with customers, leveraging new digital touchpoints to create a real-time pulse of customer preferences. This rapid response enables businesses to address customer needs quickly and efficiently.

Mobilizing Digital Operations

Digital operations can facilitate swift responses, from expedited orders to customized production. This not only meets customer demands more effectively but also helps businesses adapt to the unpredictable nature of markets.

Managing Volatility

Agility allows companies to manage volatility. Leveraging robotics and automation, COOs can scale their operations to respond to disrupted and unpredictable markets effectively.

This approach might seem technology-focused, but it’s rooted in the philosophy of putting humans, particularly customers, at the center of operations. It ensures that every technological investment has a positive human outcome.

Building A Resilient Workforce

The COO’s role in leading workforce transformation is two-fold. It involves addressing legacy organizational structures and preparing the right talent for the digital age. A key consideration, for example, is who will be responsible for implementing Artificial Intelligence (AI) and the expected results thereafter.

Legacy Organizational Structures

Many businesses are burdened by multi-layered and siloed organizational structures. These structures, designed to support the legacy business, are often out of sync with the requirements of the digital era. COOs must spearhead the transition towards structures that align with the demands of the new business landscape.

Workforce Transformation

Workforce transformation is equally crucial. In many transitioning companies, employees may resist change or lack the skills required for the digital age. COOs can play a pivotal role in this transformation.

Redesigning the Workforce

COOs should align a map of the future state of the organization with the skills necessary to support it. A “skills gap analysis” can define a redesigned workforce. This becomes the roadmap for change and a key element in collaboration with HR and talent management colleagues.

Motivating the Workforce

Today’s employees are motivated by more than just a paycheck. They seek career opportunities, personal responsibility, and values like equity and sustainability. COOs should demonstrate these elements as part of their transformation efforts.

Futureproofing the Workforce

Technology is being integrated into operations, creating a demand for highly skilled individuals. COOs face the challenge of competing with colleagues in the technology department for the scarcest talent. Moreover, this workforce requires a blend of digital skills and deep industry knowledge.

In many cases, the solution involves upskilling or retraining the existing workforce. This not only ensures that businesses have the skilled workforce they need but also fosters buy-in from employees.

The Opportunity for COOs

In most companies today, the COO is considered to be an “heir” to the CEO. The pandemic, oil, and inflation crisis has, in many cases, accelerated the succession process. COOs are now better positioned to take on responsibility for strategy, vision, market response, and people. This transition means that COOs need to act more like CEOs.

In this rebound era, it’s no longer about returning to the past but about guiding businesses toward a future of sustainable and purpose-driven growth. The COO imperative, driven by technology, customer-centricity, operational agility, and workforce transformation, is not merely a choice; it’s a path that will redefine the future of business leadership.

The fusion of technological insights, customer-centricity, operational agility, and workforce transformation marks the blueprint for the modern COO. This new era is defined by leveraging technology as a strategic asset, embracing customer needs at the core of operations, setting the pace in rapidly evolving markets, and nurturing a workforce equipped for the digital age.


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