CEO vs COO-What is the difference?

What is a CEO?

The CEO, or Chief Executive Officer, is the highest-ranking executive in an organization or company. They are the ones who make key corporate decisions, run the business operations and resources of the company, and make sure that the company remains profitable and is successful in the long run.

The CEO normally reports to the board of directors and is responsible for the company’s performance to the shareholders, stakeholders, and other main parties. Their responsibilities usually cover the setting of strategic goals and objectives, the leadership and management of the senior management and staff, representation of the company to investors and the media, and the ultimate steering of the company’s vision and direction.

In a nutshell, the CEO is the top leader of the company who is entrusted with the responsibility of leading the organization in the right direction and increasing the value of the organization.

What is a COO?

COO is the acronym for Chief Operating Officer. The COO (Chief Operating Officer) is one of the highest-level executives in a company, typically reporting to the CEO. The main function of these individuals is to supervise the day-to-day activities of the company and ensure that the operations are efficient and effective in the achievement of the company’s goals and objectives.

The specific duties of a COO can vary depending on the organization and its industry, but they often include : 

1. Preparing and implementing operational policies and procedures.
2. Handling the company’s internal workings, which include production, logistics, supply chain, and quality control.
3. Managing various departments and teams to enforce the coordination and alignment of the efforts.
4. Measuring KPIs (key performance indicators) and operational metrics to evaluate performance and find the areas that need improvement.
5. Working in collaboration with the CEO and CFO to develop and execute strategic plans and initiatives.
6. Attending to the company’s external affairs concerning operations, where it may be required to negotiate with suppliers or adhere to regulations.
7. Leadership and direction are the defining traits of an effective manager, who must build a culture of accountability, innovation, and continuous improvement.

Overall, the COO is responsible for translating the strategic vision into actionable plans and supporting the achievement of long-term goals by ensuring that day-to-day operations are well-managed.

Who is higher: the CEO or COO?

In many organizational models, the CEO (Chief Executive Officer) is at the top of the hierarchy while the COO (Chief Operating Officer) is below. The Chief Executive Officer is usually the top manager and holds the highest position in the company. They are in the end accountable for making the most important corporate decisions, shaping the strategic direction, and supervising the entire running and functioning of the company.

However, the COO normally reports to the CEO and acts as the CEO’s number-two man. Although the COO might be vested with considerable power and responsibility, especially in terms of managing day-to-day operations and ensuring operational efficiency, they are usually accountable to the CEO.

Nevertheless, it is worth mentioning that organizational structures can be diverse, and in certain cases, for instance, in small companies or startups, the roles and hierarchy may have different configurations. Furthermore, the COO may have more authority or influence in certain situations based on the organization’s specific dynamics and needs.

CEO vs COO