Building a CEO and COO Relationship
How do you build a healthy and effective relationship between a Chief Executive Officer and a Chief Operations Officer? In this episode, Traci and Rob discuss how the CEO is the vision caster, and the COO is the implementer. Learn how these roles complement each other and discover how to build a lasting CEO and COO relationship centered around healthy conflict and trust.
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Transcript
Rob:
A common topic on this show is leadership in humans. And one of the questions that comes up a lot is, well, that's great when we talk about leadership teams or maybe partnerships, but what about the very top of my organization? What is the difference between CEO versus a COO, or a visionary versus an implementer, or sometimes we call them a one versus a two and all of that and how they work together. And what does a healthy relationship between those two roles look like?
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Traci:
I do agree. This is a question I get a lot. I know you and I love talking about it because we like talking about partnerships and leadership and especially how your relationship works at Sparkbox between you and Ben, who are at the top. And I think it's a great conversation to have because in an entrepreneurial type organization and those are the types of people we tend to be talking to the most. The founder typically kind of becomes the CEO and sometimes like by accident, right?
And they often wrestle with what does that mean, and what's my job description, but as their company grows and they realize that they're getting lost in the weeds, or they're having trouble thinking big picture, being that visionary they've always considered themselves to be, or they can't scale like they want to, they've reached a wall, or they are in desperate need of like a right-hand partner in all of this is when we start to see the longing for that COO role to be created if it hasn't already naturally come to be through a partnership or through somebody who's kind of bubbled up to the top, through the building of the organization.
So once we get to that place as a company where we realize we really need these two roles in order to be successful, to take our business to the next level, to be able to get out of the weeds and start really scaling our company, it's really important to define those roles and to make sure we clearly understand how they can best work together and what might keep them from working well together, right?
How can they be successful? But what is it even that a CEO does? And what is it that a CEO is supposed to do? What are these two roles? How do we define them? What's the responsibilities that fall under each of those seats?
Rob:
Yeah. I think that's a great question. And I'll pose that question to you. I think you're in a better place to answer what a CEO does than I am.
So what does a CEO do? What should they do? How should they be spending their time?
Traci:
Well, I believe the CEO is the visionary of the organization of the company. They're the ones who really have the ability and the responsibility to see the big picture. So they are the ones that have perspective and should have perspective on where we're going, right? And then they also need to come back and inspire and align the team against that vision. So not everybody in the company knows where they're going or where we're going or gets it or accepts it, right. What's the end game. And so the visionary, the CEO is the person who's going to set the tone for that. Who's going to inspire, who's going to align, who's going to sell that vision to the people who have trouble accepting it so that we all know where we're going.
And they're also somebody who typically handles most of the external relationships. So those big client relationships, oftentimes you see the CEO, especially in more of an entrepreneurial setting or a small-midsize company being the one who's handling those big sales efforts, overarching sales efforts or BD efforts. They're the one who also knows when the company needs to pivot or hold steady.
And that's also where a good COO comes in handy too in keeping that CEO from being too hasty in making a decision or being too stagnant. But yeah, I mean, I think those are pretty much the key responsibilities of the CEO.
Rob:
Yeah. So what I heard, what I think I heard you say is the CEO is the vision caster, but then also does that work of distilling it down for the team to be able to get behind, to make it so that it's understandable for everyone.
Traci:
Yes. Yes. And they also deal with sales, client relationships typically, and they often are pretty deeply involved in the understanding the financials of the company. Maybe not in the details of it, but they understand the P&L pretty deeply and are concerned with the profitability and knowing what's happening big picture with the company.
Rob:
Yeah. Thank you. That's awesome.
So for a COO, I think a COO is somebody who is in charge of making that vision a reality, and that takes a lot of different shapes, but that's often—at least in the work that most of the industry we work with—is how to get projects done, how to make sure they're on time, on budget and are delivered on scope that we have happy clients and happy employees, there's HR systems. There's all of the how that matches up with the why that the CEO is setting. And I think that's a pretty good wrap up of those, the operator role that making sure that fills the gap between sales and profit.
Traci:
Yes. I think that's a great description. I mean, the integrator or COO is somebody who definitely creates order out of chaos. They do take that vision and execute upon it and they have a strategic focus for details. A good COO is usually great at understanding where the gaps are, of making sure they can pull all the puzzle pieces together. That's why they're often called an integrator, but then also often called the implementer because they can oversee many facets, pull the puzzle pieces together and then make sure execution's happening. Right. Because we can have vision and we can have strategy, but if there's no execution, then it's all just a big pipe dream. Right?
Rob:
Yeah. And for those of you listening, for my role at Sparkbox, I am that. My title is not COO, but that's the role that I play. And that's where I spend my life is figuring out how we implement the vision of Sparkbox. And it's a interesting balance between being strategic, but also there's a fair amount of tactical-ness of making sure that problems are being dealt with and challenges and risks are all happening and don't become larger than life.
Traci:
Yes. And the CEO tends to be more of an external-facing, you'll see sometimes there'll be the ones out speaking, or doing some thought leadership or that type of thing, or dealing with clients on a higher level. And the COO tends to be somebody who's very drawn internally, very concerned with what's happening internally, how all the pieces are working together. Has a strong eye and appreciation for talent. They're worried about the talent. They want the talent to be working well, worried about the processes. Then the CEO might cast a vision that affects culture and affects the overall general morale of the culture, the COO is really thinking more deeply about the pieces of that culture, how are we keeping it healthy and aligned and sort of the processes around making sure that culture stays healthy.
So touching many of the same things, but in very different ways, right? So there's a lot of nuance to this and there's also—and I can see this in your own relationship with your business partner—there's an appreciation when this works well. The COO really appreciates the role of the CEO and the CEO really appreciates the role of the COO and they understand what each responsibilities are and they are able to stay in those lanes.
What do you think is kind of the secret sauce for you guys? Does that resonate with you? And then how do you respect each other and sort of keep in each other's lanes while still being kind of intertwined and on the same page?
Rob:
Yeah, that's a really interesting question. And it involves a lot of discussion and a lot of, not arguing isn't a bad way, but a lot of back and forth. We're both pretty opinionated and we definitely care about the same things but in different ways.
One of the things that I've realized is my business partner, Ben, is great at…he's an idealist and he is wonderful at painting a picture of the place where we're going and figuring out how to get people to believe in that in-state. But at the same time, he really struggles with putting together a plan how to get there. And at the same time, I'm really good at parroting his vision that he set, but I'm really good at putting the plan in to get there.
And I think it's this, that we've been doing it for long enough where we see the need for both of those things, and we have a lot of respect and trust for each other. But there is times when we go 10 rounds on something and our rule is, is that we can say whatever we want in our offices, but by the time we walk out that door, there's unity. It's really, really important for us to have unity to our team, to the external world. And that is a higher order priority than being one idea over the other.
So the way that works out in reality is if we're having back and forth on something like there's often, one of us will recognize, look at it and be like, well, you either care more about this, or this is in your lane, I'll back off and we'll do it your way. And if we're wrong, we can always go back and try something else. And just doing that over and over and over again. And I think it's that openness and that healthy communication about trying to end also trying to get to the same place that makes all the difference.
Traci:
And I think what you are describing obviously is a relationship that's very much built on a high level of trust, but you also sound like you have healthy conflict. Like there's not this artificial harmony where you're just kind of agreeing just to avoid conflict, but there's also not this aggressive, “It's my way, or the highway” coming from either one of you. There's this nice middle ground where you're able to kind of argue through things in a healthy manner. But then also I love how you said, one of you can acquiesce and say, you know what? This sounds like, this is really important. I'm going to trust you. Let's go with us. Let's see how it pans out and can give each other that kind of latitude I think is pretty good.
What would you say could be something that, we'll start with a COO, could be something that could trip up a COO and maybe hinder this relationship we're talking about, this balance between the two?
Rob:
I mean, I think one of the biggest risks of being an implementer or COO or the number two, the how person is the fact that just because you're able to get things done makes you may believe that you can be the visionary, right? Because I have this ability to get the army moving and get things set up and manage the journey along a path that I can then set the destination. I think that's one of the biggest risks with being a COO.
Traci:
Yeah. I think you're absolutely right. And it usually comes once things are going really well. And the CEO is very confident in their job and they're feeling like they... Because oftentimes, it can look especially to everybody else on the team that the COO is really handling a lot of the day-to-day work. And so it might appear that they're doing more than the CEO. And oftentimes the COO will get that message from the people around them. Like, “Geez, you do everything. Or gosh” And sometimes people are doing that in a nice way. Like, “Wow, you're doing such a great job or wow, you really handle a lot or I can rely on you.” And that kind of feeds the ego. Right? And then what happens is exactly what you're talking about. Like, ”Well, gosh, if I can run all this, then I can surely just run the whole damn thing.” And so then that's what can kind of start to eat away at this balance.
And I think you're absolutely right. It does take perspective for the COO to realize like I'm not gifted in that way. That's not my thing is not to be the visionary or to do that list of responsibilities. That's not my comfort zone. That's not my gifting. What I'm doing is what I should be doing. And that's why I'm excelling. That's why I'm doing so well is because it does fit who I am.
Rob:
Yeah. I think that the other part of that, and we'll talk about CEO's here in a minute is like, I've always taken the perspective and I think rightfully so is I'm sometimes the bullet man, right? I'm the guy that stands in front of the bullet that may be coming at the company, right? Like I'm the place where the buck stops operationally and that's part of my job is to protect our visionary so that he has the headspace and the ability to continue doing his job well.
Traci:
Yeah, absolutely. I think that's true.
So, CEO. Do you want to talk about what might trip up this relationship from the CEOs?
Rob:
I think the thing that I see in other organizations that I talk to is a CEO of not being able to let go and let people implement the vision and wanting to jump in and take over when something doesn't go right or there's a slight variation on how they may have done it. And I think that I see that a lot in like single entrepreneurs that don't have a business partner or don't have someone on their exact same level being able to give those things up and trust them and give them the responsibility and the accountability to go do it their way, which if they're going to own it, that's a huge part of it.
Traci:
Yeah. And it's interesting because when a CEO gets to a point or a sole founder or entrepreneur gets to the point where they're ready to hire a COO and they could promote from within, or they can hire somebody from the outside, depending on what's happening internally. But that is the hardest thing. They get so excited to hire this person and to hand off these duties and they realize they're not gifted in this area. And they need somebody who has an eye for detail and can strategically take things to the next level. And they're so ready for it. And they hand it off and then they start to feel paranoid, naked, anxious like, “What did I just do? And does this person know what they're doing?” And they start to panic and they want to swoop back in and take the reins back.
And then you see this little struggle where they give them the reins, they take the reins back, they give them the reins they take and then it can really rock the relationship and really mess up what that COO needs to do. Sometimes it just takes time for the CEO to trust the COO and to be able to let go completely, but it is the biggest mistake and the biggest way to wreck the relationship and the potential success that can come from this relationship is just not trusting. Just not saying, “I trust you. This is your gifting. Go for it. If you need me, I'm here. I'm not abandoning you. I will help you through whatever you need, I'm alongside, but I really want this to be an opportunity for you to shine and you to take control.”
And like you said, you not just have the responsibility, you have the authority and people know you have the authority. Because what's very important is that the CEO and the COO understand their own roles and responsibilities, but that everybody else in the company also does. And so if everybody else knows. And the CEO has made that clear to everybody, then people will honor that. So the two of them need to honor each other. And then the rest of the company needs to honor it as well.
Rob:
Yeah. I mean, I see that as the single biggest thing is asking someone to take care of something and then letting your team see you not trusting them, because that is the key indicator that they should not trust them either. And that will undermine somebody every single time. And it is so hard to recover from that.
Traci:
Yes. And the go-arounds, that happens very often too, is that, especially if they're used to going directly to the CEO, to go around the COO when they're not happy with a decision that's been made. And the first thing a CEO should do, if somebody is coming to their office and said, “Hey, I'm not happy with how Rob has handled this. And I don't agree with him." And as the CEO you go, “Okay, I hear you. Hold on one second. Let's go get Rob.” You bring Rob in and then the three talk together.
The mistake so often what the CEO does is just solve the problem, or just try to take control and then go tell the COO later. You should always stop the conversation mid-sentence and say, “Let's go get the COO. The three of us can solve this together.”
So avoid the go-arounds because that will definitely erode the trust between the two, but also will erode the trust within the entire team.
Rob:
Yeah. And I think that, there's still a lot of room for that healthy dialogue, but I love when that happens. I believe in transparency, but there is still human relationships, and between two people. There is absolutely times for the CEO and the COO or any leadership to have direct conversations that are still coaching and mentoring and helping each other understand what the expectations are, how they thought it might go and clarification. But that happens in a place where you're still projecting unity to the rest of the team.
Traci:
Right. And I think just to flip to a little bit of the other side of the coin of what I just talked about with making sure there isn't a go around the COO is also to make sure that there's access to the CEO.
So we don't want everybody to think that because a COO exists, they no longer have access to the CEO and that CEO is cut off from the rest of the organization. So we want to find balance in that regard too. Where people still have interaction with a CEO, it's just in a different way for different things, right? So they feel like they can still brainstorm with the CEO. They can still talk about client relationships. They can talk about vision. They could wrestle through things. It's just the CEO is not going to handle the things that are the COO's responsibility.
So we just want to make clear that the COO isn't a stop gap for everything and that the CEO's door, all of a sudden is shut because we've hired a COO. So I think finding that healthy balance.
And I think that sometimes that's hard for a CEO and that's why they want to get back involved in the details is because they're starting to feel nervous that they've lost contact with their people. And they're not as connected as they were when they were directly handling talent issues or hiring or conflict resolution or anything like that. So you have to make sure that the CEO understands how they can stay connected and that you're working together as a team in keeping those doors open.
Rob:
Yeah. So that's a common thing that I've heard from others. Can you give or do you have any helpful hints or things to say about how a CEO should be spending their time and how they stay connected without jumping back in?
Traci:
I think it is in how they communicate. And sometimes I feel like CEOs can get worried about the meetings they sit in and don't sit in. And we always are going to have to understand, we've talked about this before that leaders, they do, there is this emotional contagion, right? Where the emotion that a leader gives off, the impact of their words, even a gesture in a meeting can change the whole atmosphere or how people think, or like they are hanging, we tend to hang on every word, especially of the CEO.
So that's always going to exist, no matter whether you have a CEO or a full-fledged leadership team, you always have to be very careful and aware of your presence and how you're coming across. But I don't think that should preclude from being present, especially in certain meetings whether that's BD meetings or meetings where you're brainstorming or talking about strategy. The CEO should feel like they can show up, like they can be a part of that, but they also need to be a good participant, right? They need to be a good listener. They need to be the last one who speaks. They need to be making sure they're setting the right tone, but there can be, and should be opportunities for the CEO to very fluidly interact with the staff.
And then also the CEO should be communicating. We've talked about this also before, over-communicating, right? So he thinks, or she thinks that she's saying the vision too many times, but that is oftentimes not true. So having town halls, having opportunities to do lunches with small groups or one-on-one meetings, those are so valuable. They're so valuable and selling through the vision and hearing what's going on in the company and how people are feeling taking a pulse on morale. The CEO should be really intentionally thinking every week who am I going to talk to today? Who am I going to have lunch with? Who am I going to have a Zoom call with? Who am I going to connect with today and making sure that's happening. They shouldn't be ending a week and have not had some one-on-one conversations with people.
And that should keep them pretty busy, between that client relationships, having town halls, doing vision casting, making sure they're understanding the strategy and how they're going to get to the goals they've set for the next 90 days, what their one-year plan is, working hand-in-hand with the COO making sure their leadership team is fed, understood, valued all leading in the right way. There's a lot that's on a CEO's plate, thought leadership. So if a CEO feels like they're not sure what to do, that probably means they don't really understand what their role is and what their responsibilities are.
Rob:
Yeah. And I think it could be interesting and difficult for both the COO and CEO to constantly understand what their role looks like as our organizations continue to grow. Because we go from this whole idea—and we talked about this before—of working in the business to working on the business and that transition doesn't happen all at once. This is gradual thing. And I think that as it happens, you can find yourself at different stages in variations of that, where you're like, “Oh gosh, I've lost everything that makes my role, my role.” But it's really just the next stage, the next season of things.
And I know for us as we've grown from four to 50 people, both Ben and I's role look completely different.
Traci:
Yeah. And I think that don't be scared at the empty space. So when you start to give off roles or responsibilities, as you grow and maybe you hire a BD person, all of a sudden, a lot of the BD efforts go to that person, don't be scared that, “Oh, that means I have more time or more empty space.”
Because we do as leaders need empty space to think, to sketch, to dream, to imagine what the future holds, to see obstacles, like I was talking about before, having intentional conversations with staff and with big clients. So don't be scared of that big space. It will fill itself if you're intentional, but sometimes you just need to go and sit with your journal and start to dream because that's your job as a CEO, as a visionary. And if your plate is so packed and so full, how are you doing that?
Rob:
Yeah, that's exactly right. You know when I talk about operations with others, I always say like, “Hey, if you're in this operator seat, you need don't think about your efficiency.” You always have to have 20%-30% of headroom to deal with fires in the unknown. And if those things aren't happening, to think about what things could be look like in the future from an implementation point of view. And I think that number goes even higher for a CEO.
Traci:
Yeah. And I think that too often, people are not giving themselves that time, that percentage. Instead, they have some empty time. And what do they end up doing? Going through their endless amounts of email or surfing the internet or whatever.
You have got to literally block off time in your calendar to be thinking of these things, to be thinking of the obstacles, to be thinking of new processes, new ideas, new vision, new, where are we going to go. To be reading and filling your mind with how to be a better leader.
Like we've always talked about leadership is a skill, you've got to hone it, you got to grow. And if you're not doing anything, reading anything, listening to anything in order to grow and get better, what are you filling that empty space with? Right. So just as we want to scale and grow our companies, that's we should want to scale and grow personally as well, but you have to have space for that. So be aware of just trying to fill the space with mindless activities.
Rob:
Yeah. That's exactly right.
Thanks, Traci. I appreciate it.
Traci:
Thank you. Another great conversation. Until next time.
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This podcast would not be possible without the amazing communications team at Sparkbox. If you like what you've heard, please subscribe and tell your friends to listen as well.
The Overly Human podcast is brought to you by Navigate the Journey and Sparkbox. For more information on this podcast, or to get in touch with Traci or Rob, go to overlyhuman.com. Thanks so much for listening.
