Mark Hurd. If there's a poster boy for chief operating officers (COOs), Mark Hurd just might be the one. Sure, he's now chairman, president and CEO of Hewlett-Packard Co. in Palo Alto, Calif. But he proved himself to be a very capable COO at Dayton, Ohio-based NCR Corp., and some people believe that Hurd, an experienced COO-type CEO, is just what HP needs to regain its position as a world-class IT market player. Among the believers is Karen Myers.
"He comes straight out of a COO background. That was his title. It's also clear that is his style," emphasizes Myers, COO and CFO of Insight Inc., a Manassas, Va.-based firm providing supply chain solutions and consulting services. "I think he is doing a very good job."
Yet, does every North American manufacturing company, regardless of its size or location, regardless of its industry, regardless of whether it's publicly or privately held, need a COO? Coca-Cola Co. clearly thinks so. To fill the vacancy created when COO Steve Heyer left the company, the Atlanta-based beverage producer on Dec. 6, 2006, announced it was promoting Muhtar Kent, the head of international operations, to president and COO.
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| Hewlett-Packard's Mark Hurd |
But more generally among manufacturers, according to a number of people who make their living dealing with such matters, the answer to the question of whether a company needs a COO is not a clear cut "yes" or "no." The answer: It depends.
Whether or not a manufacturing company needs a COO, states Scott Kingdom, depends on the skills of the CEO; the skills of the group, or division or business-unit executives; and how the executive roles have been defined. "There is nothing so inherently specific or unique about the manufacturing business that kind of automatically leads you to a 'yes' or 'no' answer," emphasizes Kingdom, global managing director of Korn/Ferry International's industrial practice. Kingdom helps manufacturing companies find, among other people, CEOs, presidents and COOs.
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Insight's Karen Myers |
"A COO is somebody whom a CEO can turn more and more of the day-to-day operations over to. And as a COO I have taken over everything from IT to human resources," says Joel Sutherland, managing director of Lehigh University's Center for Value Chain Research. In previous incarnations, Sutherland has been vice president of operations of a $300 million division of an auto parts company and COO of a $50 million logistics services company. "In an operation with many SKUs [stock keeping units], a lot of direct labor and [diverse businesses] requiring complicated systems and multiple operations, a hands-on COO is a necessity," he asserts.
In Timothy R. Hassenger's view, change -- more so than the size of a company or the industry it's in -- determines whether there's a need for a COO. And the COO's job is defined by "the degree of change that's asked or required of the business," says Hassenger, managing director of BBK, a business advisory firm specializing in manufacturing.
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Korn/Ferry's Scott Kingdom |
All those things being said, sometimes there's another compelling reason for a manufacturing company to have a COO: The CEO wants it that way.
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