5 Ways Owners Accidentally Sabotage Their First COO Hire
Congratulations! Your business is growing, and you’ve decided it’s time to hire a General Manager or COO to handle the day-to-day operations, freeing you up to focus on the owner-level work that hasn’t been getting enough attention lately. For this article, I’ll use the term COO.
Unfortunately, this hire can be challenging for many owners, and for good reason. Below are five common mistakes that can reduce your odds of finding (and successfully integrating) the right person into this role.
1. Hiring someone from within who isn’t ready yet
Great owners want to show appreciation for key team members who have helped the company grow. You’re likely comfortable with this person, you know their character, you trust them, and they reflect the culture you’ve worked hard to build. We all want more people like that in our work lives.
The question is: how do they score against the leadership and general business skills required for the role you defined up front? Deep company knowledge, strong relationships, and great cultural fit are valuable, but they can’t overcome a lack of leadership capability or business acumen in a role this critical.
If they need development and you can afford the time for growth, great! Promoting from within builds a strong internal reputation. Just be careful not to place someone into a role they aren’t equipped for. Do you have the time and skill to mentor them, or do you need outside coaching to help them develop faster?
Also keep in mind: this position, perhaps more than any other, can benefit from new perspective. An external candidate still must fit your culture, but if they come in with the right leadership and business skills, they can elevate your team (and you) by bringing approaches that have worked well elsewhere.
2. Overweighting prior experience or recommendations from trusted advisors
Most owners recognize how important this role is, so they prioritize candidates with similar prior experience. They also place significant weight on input from trusted advisors such as peer groups, financial partners, legal counsel, and others. Both are useful signals, but they often fall short in two key areas.
First, during interviews, don’t just confirm a candidate’s skills and experience, you must confirm alignment with what you believe matters to run your business. Style differences are fine. But are their priorities aligned with yours? Do they value people the same way you do? Are they a shop-floor, blue-collar leader, or more formal and “buttoned up”? Both are great, but only one likely aligns with you and your company. What worked in a prior company, or impressed someone you trust, may not work in your environment or with your leadership style.
Second, assuming their leadership and business skills check the boxes, do they align with your culture? Here we’re talking values, how they treat teammates, customers, suppliers, and how they partner with you as the owner. A candidate can’t be “technically” good enough to overcome a cultural mismatch. It can take work to uncover this in interviews, but it’s essential.
3. Hiring them, but not letting them make meaningful decisions
Reality check: as the owner, you’re accustomed to making most decisions—certainly the consequential ones. No one understands the mission better than you do, and it’s your money. That means it’s your risk if a decision goes sideways.
This hire is an inflection point for your company, and for you. If you want to free up time to do the owner-level work required to keep growing (or prepare for a transaction), you must allow your COO to make some, maybe many, decisions that used to be yours alone. You must begin thinking of the company as something separate from your personal life and finances, and I appreciate that this is not easy.
A strong COO also wants to make decisions, and they want to include the team in many of them. They’re collaborative, aware of what they don’t know, and focused on building an engaged team around them. Decision-making is part of “owning” the role. It’s key to their fulfillment and happiness, and it directly impacts their long-term success in the position.
This is where owners often see a candidate problem, when it’s really an owner challenge. Your job becomes setting objectives, reinforcing the company’s vision and values, and ensuring leadership performance aligns with those, not second-guessing every decision. You’re paying this role at a level that should allow you to focus more on results than on the details of how they get achieved.
That said, some decisions will still require your input or approval, and some will remain exclusively yours. The key is to define those boundaries. Discuss this at a high-level during interviews, then go deep during onboarding to ensure alignment.
4. Unclear expectations around communication with the owner
Ideally, your company already uses weekly and monthly metrics that make performance visible to the people who need to know. In some companies, owners rely on their personal involvement to stay informed. If that’s the case, building regular reporting and metrics should be a top priority so you can step back without losing visibility.
Even with strong metrics, there are always topics many owners want visibility into: employee struggles (personal or professional), customer disappointments, and even industry “gossip,” to name a few.
When you’re informed, you’ll need to resist the urge to tell the COO exactly how to handle it (see #3). Early on, it’s reasonable for you to ask, “How are you going to handle this?” Strong COOs come to those conversations with a plan, or at least clear next steps, rather than simply sharing information, or dropping a problem in your lap.
5. Lack of transparency between owner and COO
The classic challenge here: an owner hesitates to share sensitive information with a new teammate. Trust must be earned, and that takes time. But your COO needs meaningful context to make good decisions, and to truly free you up.
So what’s the answer?
First, vet this thoroughly in the interview process. Make it an explicit topic and watch how the candidate responds. Do they treat confidentiality with the seriousness it deserves, or are they too casual? It’s your company, and what you decide to keep closely held is your decision. You’re trying to determine whether they can operate within those boundaries.
Second, put formal agreements in place. Create an NDA, confidentiality, and non-solicit agreement with your legal counsel. A document doesn’t replace trust, but it reinforces expectations and signals the importance of the topic.
Third, remember transparency goes both ways. How comfortable is the candidate being open with you? The two of you will tackle big topics. Can they share a strong opinion in a way that adds to the discussion rather than derailing it? Will they admit mistakes? What about missteps by their team? Will they own the outcome even if it wasn’t “their fault”?
The takeaway: explore this openly and candidly in the interview process. Ask for examples of handling sensitive information. Ask about a time something went wrong on their team, did they tell their manager? What did they learn? What would they do differently next time? Listen closely for ownership versus blame.
Closing
The last thing I want to imply by naming these traps is that hiring the right person for this role isn’t possible. It absolutely is. The key is to treat it as the high-impact hire that it is, for you and for your team, and to take a comprehensive approach that maximizes your odds of success.
Done well, it can be transformational for both you and your company.