A corporate structure refers to an organization with various departments. These departments are under the control of higher supervisors. Corporate consists of a standard organized composition including Owners/stakeholders, board of directors, head officers, and employees. Here, let’s know about them- CEO Vs COO Vs CFO.
The owner and the stakeholders are not directly involved in the working of the corporate company. The rest three structures:
a) The board of directors, meets only at regular intervals.
b) The officers supervise and guide the employees and look at the daily operations
c) The employees perform all the duties and works assigned by the head officers.
The officers are the main factors in a corporate office. They are the high-level management associates/executives. These executives get appointed by the board of directors of the company. The high-level officers who control all the works of the company are the Chief executive officer (CEO), Chief finance officer (CFO), Chief operating officer (COO).
These C-level executives make all the decisions regarding the company. There are a lot of job titles under this C-level title like CTO, CMO, CIO, CHRO, CAO, and others.
Chief technology officer (CTO)- Responsible for the technology department
Chief marketing officer (CMO)- Responsible for marketing aspects in the organization.
Chief Information Officer (CIO)- Responsible for information department and informational aspects
Chief Human Resource Officer (CHRO)- Responsible for the human resource department
Chief Administrative Officer (CAO)- Responsible for the company’s administrative department
The role of the C-level of executives in a company is dependent on some factors. The size and nature of the company play a vital role in the total number of C-level executives. These executives get selected from the internal promotion, or the board of directors chooses from the stakeholders. The C- level executives go through a lot of challenges in their company. They make use of their foundational knowledge and skills to overcome those challenges.
In this article,
We will discuss the difference between the three C-level executives: CEO, COO, CFO of the company. In this context, we will discuss
- The evaluation of C-level executives
- CEO, COO, CFO
a) Job description
b) Salary the roles earn
c) Skills and competence
d) Qualifications required for the CEO, COO, CFO
e) Liabilities of the highest level executive
f) Roles and responsibilities of these job roles
- Points of difference between
CEO and COO
CEO and CFO
COO and CFO
The evaluation of C-level executives
The board of directors of every corporate company conducts a meeting and selects the C-level executives. The executives get elected to take all the responsibilities of the company. The overall look at every matter related to a company, such as loss prevention, control on marketing, security management, inspections, etc.
The digital transformation in an organization has rapidly increased the availability of C-level executives. It is also changing the opportunity for the executives to develop a solid foundation in the corporate sector. The increase in the number of C-level executives in the last five years has been observed. About 80 % of the board of directors’ survey says that companies have added C-level positions. In which CEO, COO, CFO are the most common.
For further information on the difference between COO, CEO, and CFO, please, continue reading the article.
CEO
JOB DESCRIPTION
CEO or Chief Executive Officer- In an organization, the CEO is the highest-ranking executive. They are responsible for overall all the decisions that mean they are the head of all the internal affairs within a company.
A CEO keeps a constant awareness through their skills on both the external and internal affairs of the company. They keep an eye on the opportunity to expand, new market strategies, new industry development, customer guidance, competitive landscape, and many others.
Overall, providing the framework for all working in a company is the main motive of a CEO. All the other organizational members, such as President, vice president, senior directors, and some C-level executives, are accountable to the CEO. These officers work under them and also support them in making decisions. The CEO makes strategies to ensure that all the officers and employees experience the consequences of their measures and actions that motivate them to work more efficiently.
The consequential elements that help the CEO in ensuring that the associates and the officers work more efficiently in the future are:
a) Rewards
b) Performance coaching
c) Recognition
d) Competitive rewards such as gifts, bonuses (in any form)
e) Disciplinary actions
These elements are necessary to run a company/organization. Without these elements and accountability, the CEO may fail to attain the desired goals, success, and profitability.
SALARY OF A CEO
Everyone knows that the salary of any employee depends on the type of industry, location, and experience. According to the United States Bureau of labor statistics (BLS), 2020
- The Median Pay is- $185,950
- Annual salary (Highest 10%)- $208, 000
- Annual salary (Lowest 10%)- $62,850
SKILLS & COMPETENCE
To be a successful CEO, it needs some following skills and capabilities.
1- Interpersonal skills: This skill is all about your internal abilities and behavior. For a CEO, these skills are necessary to create a good relationship with the other officers. This skill helps the executive to manage their emotions and cope with the new challenges. A CEO’s interpersonal skills have significant input on the organization. It boosts up other officers’ strength regarding any decisions.
2- Analytical skills: This skill tells the ability of a person. Through this skill, they destroy information in a small and different categories. This skill consists of categories, such as logical reasoning, research, creative nature, communications, critical thinking, and data analysis. A CEO must have these skills for handling problems and successfully reaching the desired goals. Before evaluating an organization’s success, they should ensure that the strategies are measurable.
3- Leadership skills: It is a core value for any executive of a company. A CEO needs to have this skill to supervise and guide the officers working under them. This skill helps the CEO to make the company’s mission successful. To be a successful leader, a CEO must provide directions, guidance to the officers, attract followers, and more other aspects. A CEO can only become a good leader if they create a vision and successfully convince others to follow those decisions.
4- Management skills: This skill makes a person understandable. The CEO is responsible for managing the cultural learning of a company. Through creating a culture of learning, they enhance and grow the ability of officers and employees of their company. It is true that which company plays significantly, grows successfully.
EDUCATION QUALIFICATION & TRAINING
Education qualification and training are necessary to get any job in any industry. The selection of a CEO also contains many criteria such as education, certificates, training, and experience. Many organizations prefer to select the CEO within the company rather than from stakeholders or outside.
Education qualification
- For the position of CEO, the candidates need a bachelor’s degree
- A person needs to have a master’s degree in a particular course.
Experience
- Years of experience in a management
- Years of experience in a related sector
- Experience as a leader or managerial post.
Training
- For the role of CEO, a person needs to have complete training as an executive of the company.
- They must have training for executing the company and for its development.
LIABILITY OF A CEO
- The CEO is personally liable for the tax evasion of the company. They are jointly responsible with the company owner/stakeholders.
- The CEO is also personally liable for several tax payments. They run the company, so it is their responsibility.
- According to Article 25 of law, The CEO is liable for facing prosecution if the company fails to pay any debt.
ROLES AND RESPONSIBILITIES
A CEO is the highest level executive of a company who manages all the day-to-day operations and functionality. They ensure that the created strategy gets implemented according to the cultural needs of the organization. In small companies, they take over all the responsibilities and do more hands-on jobs like hiring staff. In larger companies, they only deal with high-level work like deciding for the company.
The duties and responsibilities of a CEO include:
- Making short and long-term strategies for the development of the company.
- Making communication with the outsiders on behalf of the company such as stakeholders, government, and public
- Evaluate and create the mission and vision for the company and strategies to implement them.
- Maintaining the company’s social responsibilities high.
- Supervise and evaluate the work of other officers such as the President, vice president, and other c-suite executives.
- Take the liability personally for all the payments, taxes, and debt of the company.
COO
JOB DESCRIPTION
COO or Chief Operating Officer is another high-level executive of the company. They are also known as the second in command in a company. This position is responsible for supervising the daily operations of a company. They ensure that all the business operations work efficiently and effectively. A COO is a high-performing executive that develops an effective, productive, and efficient platform for the officers to perform all the functionals within the company.
This position works closely with the CEO and CFO and coordinates the other officers. To maintain the operational procedure, they create new challenges for the officers and strategize them to implement the operation excellently. A COO primarily oversees all the functions of a company. They handle marketing, human resources, sales, production, development, and all other departments.
A good COO provides a strategic vision to the officers to run the organization with their leadership skills. These visions bring operational control in an organization by creating a managerial, operation, and administrative procedure.
This position optimizes challenging situations to maximize customer satisfaction. A COO supports the CEO and strengthens their weakness, which benefits the company by bringing the best leadership to the forefront.
SALARY OF A COO
How much does a COO earn?
As we know this position is the second-highest at the management, so the salary ranges to the highest.
- The median annual pay is- $100,930
- Annual salary (Highest 10%)- More than $208,000
- Annual salary (Lowest 10%)-Less $68,360
SKILLS & COMPETENCE
To be a successful CEO, it needs some following skills and capabilities.
1- Leadership: To be a successful leader, a COO must have leadership skills. This skill helps the COO to manage the company to work effectively for the customers. They must have this skill to lead and supervise the business.
2- Communication: A COO must have good communication skills to influence the officers and other C-suite executives. This skill helps them in resolving any issue clearly, without any problem in understanding. Building good communication with the consumers, negotiating, and influencing the internal and external stakeholders, proves to be the best skill for a CEO.
3- Decision making: This skill helps the COO evaluate and identify the outcome of the consequences. It helps them to navigate the risk on any decision. To be a successful COO, one needs to have these skills.
4- Strategy: A COO must have excellent strategic thinking that helps them to run the company. A good strategy helps the company to develop and open a new perspective to do things better. For creating better visionary and innovative ideas, a COO must need to build a strong strategy.
EDUCATION QUALIFICATION & TRAINING
To get selected as a COO, a person needs educational qualifications, certificates, training, and experience.
Education qualification
- For the position of COO, a candidate needs a bachelor’s degree.
- Most companies prefer an employee with a master’s degree. A person needs to have a master’s degree in their related field/subject.
Experience
- Years of experience in a management sector
- Years of experience in a related firm/industry
- More than five years of experience in human resources, operations, and strategies is must.
- Must be working with a particular company for more than ten years.
Training
- For the role of COO, a person needs to have complete training as an employee for many years.
- They must have years of training for making decisions relating to the company.
ROLES AND RESPONSIBILITIES
A COO is the second in rank highest level executive of a company who manages all the day-to-day operations and functionality. A COO gets hired by the board of directors, and all the lower grade executives work under them.
The COO has some duties and responsibilities:
- Evaluate and analyse the productiveness of the strategies
- Supervises all the working of the different departments
- They support the CEO and establish the policies to achieve the desired goals.
- The inventory department and capital market get managed under the COO’s supervision.
- Creates strategies and Goals to meet a benchmark for the success of the company.
- Handling issues and solving the problems related to the company or employees.
CFO
JOB DESCRIPTION
CFO or Chief Financial officer is the head of the company finances. They are the third high-level executive for the financial actions, and this position works hand in hand with the CEO and COO. In some companies, (mostly small companies), they are known as treasure as they control the accounting division.
A CFO needs to have complete positive ventures to have the right track on the financial report. This financial report helps the company to have a hold on finance. Company finance is the hard part to handle, as all the things depend on money. A CFO needs to control the finance department and create a strategy to make proper use of finance. They play a vital role in making policies for the betterment of the company. A financial report designed by the officers firstly gets adhered to by the CFO.
A good CFO only need not needs to be a good number guy, but they should also know how to handle the operations in an organization.
SALARY OF A CFO
How much does a CFO earn?
Here we will get to know about the CFO’s financial status.
As we know, this position is the third-highest at the company, and the first position at the financial department, so the salary ranges to the highest.
- The median annual pay is- $
- Annual salary (Highest 10%)- More than $
- Annual salary (Lowest 10%)-Less than $
SKILLS & COMPETENCE
To be a successful CEO, it needs some following skills and capabilities.
1- Problem-solving abilities: A CFO must have problem-solving skills to solve all the issues related to finance. Every day a CFO makes both small and big decisions that affect the company in various manners. Sometimes it takes the company to hike, or it may make it fall, so a CFO must be good enough to make a win-win situation and get a good deal in the company’s favor.
2- Leadership skills: CFO is the third-highest rank executive. To run a company, a person must have leadership qualities. Being a Chief Finance Officer of a company leaves you with several problems. A good CFO must have leadership skills to handle all situations and formulate strategic solutions.
3- Account handling: This position handles all financial accounting, cash management, and corporate finance competence. For being a CFO, a person must have an expert in managing accounts and working effectively to make decisions related to accounts.
4- Reliable: The head-level executive of the company has a lot of pressure, so a person must have the skills to work under pressure. A CFO should be open-minded and must produce correct information timely.
EDUCATION QUALIFICATION & TRAINING
To get selected as a CFO, a person needs educational qualifications, certificates, training, and experience. The education qualification of a CFO differs from organization to organization. There are some qualifications and training that a CFO must-have.
Education qualification
- For a position of CFO, it requires a bachelor’s degree in business administration, finance, accounting, and equivalent field.
- Most companies prefer an employee with a master’s degree. A person needs to have a master’s degree in finance, accounting, financial analyst, and other related fields.
Experience
- Years of experience in a management sector
- Gain years of experience in a financial department
- Experience with the career network
- Must be working with a particular company for more than ten years.
Training
- For the role of CFO, a person needs to have complete training as an employee in the finance department for many years.
- They must have years of training for making decisions relating to the company.
Certification
- Certificate of certified public accounting (CPA)
ROLES AND RESPONSIBILITIES
A CFO is the third in rank highest level executive of a company who manages all the small and big financial operations. The CFO’s roles depend on the size of the company and vary from one organization to another. A CFO gets hired by the board of directors, and all the lower grade executives work under them.
The duties and responsibilities of a CFO include:
- Manages all the finance and accounts terms of an organization
- Supervises and coordinates the auditors of the finance department
- Supports and advises the CEO and other executives based on the financial implications.
- Relate with the stakeholders and investors and understand their needs.
- Discuss, analyze, and strategize the plan to upgrade the financial system or other systems of an organization
Differences between these
CEO and COO
CEO
- First in command
- Works under the board of directors and reports to them
- Creates the vision and mission of the company
- Personally liable or accountable for all the for facing the failure
- Coordinates and oversees a long term planning
COO
- Second in command
- Works under the CEO and report to them
- Executes the created vision and mission of the company
- Liable and accountable for facing any problem in operations
- Supervises and oversees day-day operations of the company
CEO and CFO
CEO
- Responsible for all the performance of the company
- Responsible for creating and accomplishing the general strategy
- CEO is the public face and connects to the outsiders on behalf of the company
- They are accountable to the board of directors
CFO
- Responsible for all the performance of the financial department
- CFO is responsible for strategizing the plan for the financial support
- CFO plays a liaison role and works for financial institutions
- CFO works under the CEO and is accountable to them
COO and CFO
COO
- Second in command
- Works under the CEO and report to them
- Executes the created vision and mission of the company
- Liable and accountable for facing any problem in operations
- Supervises and oversees day-day operations of the company
CFO
- Third in command
- Works with the COO and report to the CEO
- Oversees the financial aspects of the company
- Liable and accountable for facing any problem in the financial sector
- Supervises and oversees all the small and big finance operations
Conclusion
These top-tier executives are the head of the company and handle all the functions. They make all the decisions related to the company, which determines success and failure. These high-level executives require years of experience and soft skills to manage the company and create strategies to develop it.
This article is all about the difference between the CEO, COO, and CFO. We have provided all the required and necessary points to make the difference between them.
We hope this article has helped you to know all the information related to the topic.
