What does a fractional COO do in a B2B startup?

A fractional COO is a senior operator who works in your business one or two days a week, putting in the systems, processes and structure it needs to scale. Because they aren’t there every day, the job is to make the business run well without them, then hand it back to your team.

The call

A typical first call goes something like this.

“We’ve been growing quickly and the team has just got it done. But everything is ad hoc. Different people follow different processes. Knowledge transfer is becoming an issue. As we scale, we’re worried it’s all going to fall apart.”

That’s usually the right moment to bring one in.

I’ve done this work in a number of businesses over 25 years. I’ll use one as the example here: Profusion, where as COO I helped take the team from 15 people to 100 and triple revenue in 24 months, while turning an email marketing agency into a data science consultancy.

What a fractional COO does

Starts with an audit

I start by understanding how the company ticks, where it’s heading, and what works and what doesn’t, looking at both the numbers and what people tell me.

I talk to all levels, not just the senior leaders. That’s where you find the problems that never reach the leadership meeting.

Agrees with the CEO who owns what

At Profusion the CEO owned strategy, the consulting team, the commercial team and the finances.

I did the rest.

Getting that split right matters. Harvard Business Review’s study of the COO role found that the relationship with the CEO, built on trust and real decision rights, is what makes or breaks it (HBR).

Sets the rhythm

A COO puts a regular rhythm around how the business is run.

At Profusion we had a weekly leadership meeting, plus one for each of my teams. Every quarter we reviewed where we were. Once a year we went offsite to plan, looking one year and three years ahead.

Looking back, it was the EOS approach (the Entrepreneurial Operating System), though we didn’t know it at the time. In EOS the person running this is called the Integrator, and they keep a weekly scorecard of around 5 to 15 numbers (EOS Worldwide).

Ours had four: utilisation, pipeline, client satisfaction, and any major issues.

Makes the numbers visible

A COO wants the leadership team to see which clients make money, and what the work really costs.

At Profusion we brought in time tracking. It showed the usual issues I’d seen before: some clients were being over-serviced. It also showed how much something actually cost us to implement, so we could price accordingly.

Rolling out time tracking is always a challenge, because it can feel like the team is being monitored. Being transparent about how the data would be used got us past that. It was for understanding clients and pricing, not for measuring performance.

Right-sizes the systems

The systems should fit the business: what it does, how it makes money, and how big it is.

When I arrived at Profusion, it had a custom Salesforce setup that was overkill for its size, and almost everything else ran on Word and Excel. We replaced it with an agency management platform that understood how an agency bills, by time, and let us analyse our commercial data. It also lowered the complexity, so we could do things quickly.

Removes the quiet bottlenecks

One I’ve come across a few times is work that can only go through one person, because the training and processes to spread that knowledge around were never put in place.

A small example. Anyone who has built an HTML email knows how finicky it can be. At one business, every email ended up going through one person. We trained more people to do it, and put the person who had been the bottleneck in charge of the project and of maintaining it.

Finds quick wins

Early on, I look for a few quick wins alongside the bigger changes. One was cutting the back and forth across a team on some of the most common tasks, so things got done faster.

Wins like that bring the team along, because they can see things improving. Senior leadership see it too, in morale, and in progress on their own priorities.

Takes the team through the change

At Profusion, becoming a data science consultancy meant bringing in new skills in data science and visualisation, and evolving some existing roles. We also had to balance the cultural shift, from a company that was conservative to one that was innovative.

What a fractional COO isn’t

Because you aren’t there all the time, the systems and processes for the day to day have to sit with the existing team. If the business only runs smoothly on the days I’m in, I haven’t done the job.

The hands-on work of managing a live project is usually best kept in house. My job is to set it up so your team can run it.

How long it lasts, and how it ends

Most engagements run one to two days a week.

The aim is to work myself out of the role. In my experience that usually means a full-time hire, eventually. The business grows into needing an operator every day, and by then it has the systems, the numbers and the structure for that person to step into.

It’s not the right answer for every business. If you need more hands doing the work, rather than someone to design how it gets done, you need contractors or a hire. And if you already know you need someone full time, a fractional COO will only delay that decision.

If you recognise that call at the top, that’s what fractional COO work is for.

FAQ

What does a fractional COO do?

A fractional COO works in your business part time, usually one or two days a week, to build the systems, processes and structure it needs to scale. That typically means auditing how the company runs, agreeing with the CEO who owns what, setting a rhythm of leadership meetings and reviews, tracking a few key numbers every week, fixing bottlenecks, choosing the right systems, and supporting the team through change.

How many days a week does a fractional COO work?

Usually one to two days a week. Enough to own how the business runs and make decisions, without the cost of a full-time hire.

What’s the difference between a fractional COO and a full-time COO?

A full-time COO runs operations day to day. A fractional COO isn’t there every day, so the job is to put the systems and processes in place for your existing team to run the day to day themselves.

When does a business need a fractional COO?

When it has grown quickly and the team has made it work, but processes are ad hoc, different people do the same thing in different ways, and knowledge is stuck with individuals. If you’re worried it will fall apart as you scale, that’s usually the time to bring one in.

When is a fractional COO the wrong choice?

When you need more people doing the work rather than someone designing how it gets done, or when you already need an operator in the business every day. In those cases, hire.

How does a fractional COO engagement end?

The aim is for the fractional COO to work themselves out of the role. Often that means a full-time hire once the business needs an operator every day, with the systems and structure already in place for that person to step into.