These two roles are at the top of a company’s hierarchy. But, if we compare the CEO vs COO, we’ll find that their roles and responsibilities are not always clear. Let’s dig into their similarities and differences by starting with a definition of CEO and COO.
What is a CEO?
The CEO meaning is Chief Executive Officer. This is the highest-ranking person in the company. CEOs formulate business objectives and make strategic decisions (e.g. expansion in a new market or development of a new product).
What is a COO?
The COO meaning is Chief Operations Officer. This is the second-in-command to the CEO. COOs take the CEO’s vision for the company and turn it into an executable business plan. They oversee all operations and ensure that teams work toward achieving the business goals.
Who is higher: CEO or COO?
The CEO; this is the top-ranking position within the company. The COO comes second in the hierarchy and reports to the CEO. Depending on the structure of the company, the CEO could report to the board of directors, the investors or the founders of the company.
Small companies might not have a COO at all, while the CEO could be the founder of the company (or one of the founders) or the chair of the board. As companies grow and have more complicated procedures, they might need to hire a COO to advise the CEO and manage all internal operations.
What is the difference between CEO and COO?
If we want to explain the difference between CEO and COO in one sentence, we’d say that CEOs are in charge of where the company is going, while COOs are in charge of how the company will get there. In other words, the CEO has a vision for the company and the COO executes it. But, this doesn’t mean that the CEO spends their time in vague plans or that the COO only has a transactional role.
Both of them have high-level responsibilities that affect the success of the business. CEOs rely on COOs to keep an eye on daily operations and provide their insights in the course of organizational changes. On their part, COOs will make strategic decisions and establish company procedures once they get input from CEOs regarding bigger picture plans and shareholders’ perspectives.
To better understand their differences, let’s compare these two roles side-by side:
CEO vs COO
|First in command
||Second in command
|Reports to the board of directors
||Reports to the CEO
|Sets the company vision
||Executes the company vision
|Is accountable for the success or failure of the company
||Is accountable for how well the company functions
|Oversees long-term planning
||Oversees day-to-day operations
|Has an external focus, collaborating with investors, partners and other external stakeholders
||Has an internal focus, working with various departments to ensure procedures operate properly and policies are implemented effectively
Frequently asked questions
Is the CEO or COO higher in an organization?
The chief operating officer (COO) is the second-highest C-suite executive rank after the CEO. The primary responsibility of the COO is to oversee business operations, which may include marketing and sales, human resources, research and development, production, and other functions.
Is COO higher than VP?
The COO usually has more work scope than an Executive Vice President. But the Executive Vice President generally has more power and responsibility than a COO. That is why an Executive Vice President is higher than a COO.
Who is the most powerful person in a company?
In general, the chief executive officer (CEO) is considered the highest-ranking officer in a company, while the president is second in charge; however, in corporate governance and structure, several permutations can take shape, so the roles of both CEO and president may be different depending on the company.