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Q: COO and/or President role ( Answered 5 out of 5 stars,   0 Comments )
Subject: COO and/or President role
Category: Business and Money
Asked by: robbyg-ga
List Price: $200.00
Posted: 17 Feb 2006 12:57 PST
Expires: 19 Mar 2006 12:57 PST
Question ID: 447048
Do fewer large companies now have execs in the COO or President role? Is
that number two position diminishing?  Must cite published
source/article reference, e.g. NY Times, WSJ., but don't need quant
survey. Almost sure I saw piece(s) on this in 2005.

Request for Question Clarification by pafalafa-ga on 18 Feb 2006 04:51 PST

I'd like to clarify your question a bit.

It's easy to imagine a trend whereby companies are eliminating COO
positions, or other sorts of high level, but second-tier, executive

But it's hard to see how large companies would function without a President.  

Can you point to an example?  Are you sure you meant to include the
position of President in your question?

Just checking....


Request for Question Clarification by pafalafa-ga on 18 Feb 2006 06:36 PST
I did find an in-depth article that likens COOs to an endangered species.  

The article provides examples of disappearing positions, but doesn't
provide any actual numbers (e.g. 12,000 COOs in 2000, but only 6,000

Is that the sort of thing you're looking for?


Clarification of Question by robbyg-ga on 18 Feb 2006 09:38 PST
In response to pafalafa--

1. The article(s) might not necessarily refer to the President as a
disappearing role, but certainly would include the COO.  It was more
around the disappearance of a strong number two.

2. The article(s) I seek would indeed cite large corporate examples.


Clarification of Question by robbyg-ga on 18 Feb 2006 11:15 PST
...and yes, it sounds like what I am looking for.  Thanks.
Subject: Re: COO and/or President role
Answered By: pafalafa-ga on 18 Feb 2006 12:09 PST
Rated:5 out of 5 stars

Thanks for getting back to me.

Turns out your initial question was on-target...President's are
disappearing at a number of companies.  So are COO's.

I've included excerpts from articles that cover the trend regarding
COO's, and numerous examples of companies that have eliminated C-level
positions -- note that most of the articles do not have URLs, since
they came from non-internet database searches.

First, the articles discussing overall trends for COO's:


[You may need to sign up for free registration at this site, before
accessing this article]
Corporate Board Member
March/April 2004

A Dying Breed
by Randy Myers

...Need a good COO to complement your CEO? Apparently, fewer and fewer
boards think so.

...According to the recruiting firm Crist Associates, in 2002 only 17%
of companies listed in the Fortune 500 and the S&P 500 named anybody
to fill the jobs of chief operating officers who had been promoted.
That?s down from 47% in 1996. The findings dovetail with a paper
released last fall by professors Julie Wulf of the University of
Pennsylvania?s Wharton School and Raghuram Rajan of the University of
Chicago?s Graduate School of Business, who examined 300 large
companies and found that between 1986 and 1999 the number employing a
COO decreased by about 20%.

...Crist Associates president Peter Crist attributes the trend in part
to younger CEOs with a more hands-on approach, plus urging from boards
that want the CEO to know exactly what?s happening at the operations

...Some chief executives also say they?re being pressured by outside
stakeholders to keep their eyes and ears open in the wake of the
recent accounting scandals. ?I don?t know that I?ve heard that message
as an explicit statement, but I can feel it,? says Gregory T.
Swienton, who as chairman and CEO of Ryder System, a Miami-based
transportation and logistics-management company, works without a COO
at his side. ?When I talk to shareholders and analysts, the level of
detail we get to assumes that I?m close to the business, and I think
it helps our credibility that I don?t have to rely on somebody else to
have those discussions.?


Corporate jungle may claim another victim. 
20 October 2003
Financial Times 

...It may be too early to put them on the endangered species list, but
chief operating officers are a breed that, like frogs and songbirds,
you just don't see as often as you once did.

...For every handful of companies that appoints a COO to take the
strain off an over-worked chief executive - recent examples include
Sprint, the telecoms group, and Wrigley the chewing-gum maker - a
slightly larger handful abolishes the position.

...Companies that have decided to do away with the post include
Capital One, Reuters and Sun Microsystems.

...Julie Wulf, an assistant professor at the Wharton School of
Business at the University of Pennsylvania, said: "Statistically
speaking, companies are less likely to have chief operating officers
than they were a decade ago".


Do you need a COO? 
1 July 2002
Healthcare Executive

...To investigate if relinquishing the COO position is a growing trend
in its immediate market, the Katz Consulting Group surveyed hospitals
in the Philadelphia metropolitan area. Using questionnaires and
personal follow-up interviews with CEOs, we found varied reactions to
the consequences of eliminating the COO position. Of the 19 CEOs who
responded to our questionnaire, most represented community hospitals;
two children's hospitals also replied, but no academic medical centers
participated. Of the respondents, 9 had COOs in place, 3 had never had
a COO, and 7 had COOs in the past but eliminated the position. Of the
9 current COOs, 7 had held the position for more than five years.

...Hospitals appear to have eliminated their COO positions
increasingly in recent years. Of the 7 hospitals that eliminated their
COO positions, 3 had done so since 2000; 2 more had dropped the COO
position in the past five years; and 2 others dropped the position
before 1996.


And here are some excerpts from articles on positions eliminated at
specific companies:


Russell to cut president's position 
10 August 2005
The Associated Press

...Sporting goods company Russell Corp., in a move aimed at
"flattening" its organizational scheme, said Wednesday that it
eliminating the position of president and chief operating officer.

...Russell Chairman and Chief Executive Jack Ward said in a statement
that eliminating the position will help create "more accountability"
within the company's business units.

...Russell, whose athletic brands include Jerzees and Huffy Sports,
said it expects to take a charge in the third quarter tied to
Letzler's departure


Bell Helicopter eliminates president's position.
2 December 2003
Reuters News

...Bell Helicopter, a unit of Textron Inc. (TXT.N), on Tuesday said it
eliminated the position of president and created a new executive slot
to reduce supply chain costs as the U.S. conglomerate relies heavily
on waste-cutting programs to meet profit goals.

...Bell is eliminating the president's position. But Forth Worth,
Texas-based Bell now will have a senior vice president to oversee its
integrated supply chain.


Vail Resorts eliminates president's position citing travel industry woes
22 October 2002
The Associated Press

...Vail Resorts Inc. announced Tuesday that it has eliminated its
position of president as the ski resort operator looks to cut costs
amid a weak business climate.

...Vail chief executive Adam Aron wrote to employees, "I want to
stress that Andy's separation from Vail Resorts is not for performance
reasons, but rather because we feel our company will operate better if
it does so with a lower cost structure, and to the extent possible,
with fewer layers of management.

...Analyst Stacy Forbes with Janco Partners of Denver applauded the
cost-cutting..."I think they are doing what is prudent right now. They
have been very conscious of cost-cutting and cost management over the
past season. Now it is hitting the higher echelons. It was bound to
happen, given that the economy has been weak for a prolonged period,"
Forbes said.


Textron's Loranger Becomes President and CEO of ITT Industries;
Textron COO Position Eliminated
28 June 2004
Business Wire

...Textron also announced that it has streamlined reporting of its
manufacturing segments and eliminated the position of chief operating
officer. The company's four manufacturing segments - Cessna Aircraft,
Bell Helicopter, Textron Fastening Systems and Industrial -- will
report directly to Textron Chairman, President and CEO Lewis B.
Campbell. Textron Financial Corporation will continue to report to
Executive Vice President and Chief Financial Officer Ted French.


Hanover Direct, Inc. Announces Elimination Of Executive Position In
Continuation Of Strategic Business Realignment Program
13 February 2004
Dow Jones News Service

...Hanover Direct Inc. (HNV) eliminated the position of executive vice
president, finance and administration, currently held by Brian C.

...The move, effective Fridya, is a continuation of the speciality
marketer's strategic business realignment program over the past three


Business Brief -- Kulicke & Soffa Industries Inc.: Post of President
Is Eliminated Amid Cost-Cutting Campaign
4 September 2002
The Wall Street Journal

...Kulicke & Soffa Industries Inc. said it eliminated the position of
president due to continued weakness in the semiconductor industry.


Vermont's Verizon chief stepping down 
21 November 2002
Associated Press Newswires

...Louise McCarren is stepping down as president of Verizon Vermont
because the parent company has eliminated the position.

...McCarren said Wednesday that an executive based in Boston will take
over management of the company's Vermont operations at the end of this


Microsoft chief operating officer engineers himself out of a job ;
Rick Belluzzo says he knew restructuring would make his own position
4 April 2002
The Grand Rapids Press

...Microsoft Corp. president and chief operating officer Rick Belluzzo
resigned Wednesday after just over a year in the job, and Microsoft
said it would eliminate his position.

...The restructuring will give the software giant's main business
units more responsibility for their fiscal and operational performance
-- duties traditionally given to a chief operating officer.

...In an interview Wednesday, Belluzzo said he had engineered the
restructuring because it was necessary for future growth..."We needed
to really change the orientation of the business to where business
owners could not only (control) product development but also how the
product goes to market and so on," he said.


Equifax excises president's job in realignment 
19 November 2003
The Atlanta Journal - Constitution

...Equifax said Tuesday it cut out a level of management to increase
efficiency, speed decision-making and reduce the distance between its
chief executive and customers.

...The credit report and marketing company eliminated the position of
president and chief operating officer, which was held by Mark Miller.

...Under the realignment, the heads of the six business units carved
out of existing businesses will report directly to Thomas Chapman, the
chairman and chief executive.

...The move was a surprise but a positive one, said Timothy Fidler,
director of research at Ariel Mutual Funds, which owns about 4.4
percent of Equifax's stock..."I've long felt they suffered from a
confusing reporting structure," Fidler said from Chicago.


I trust that is exactly the sort of information you were looking for.

However, please don't rate this answer if the material has missed the
mark in any way.  Instead, just post a Request for Clarification to
let me know what else you need, and I'll be more than happy to
continue my research.



search strategy -- Searched several newspaper databases for [ trend OR
survey AND eliminated president OR chief executive OR coo OR position

Request for Answer Clarification by robbyg-ga on 18 Feb 2006 19:13 PST

I appreciate your efforts, and they point in the right direction.  My
concern is that the most recent piece (other than individual examples)
is the Corporate Board Member article you identified, which is now
about 2 years old.  I am in search of a piece that might be a little
more recent, and have a strong (but not necessarily 100% reliable!)
recollection of one in the New York Times or the Wall Street Journal
in 2005.  If something like that doesn't come up in your research (of
comparable source and/or time frame), we may as well call it complete,
and I will take it on that basis.  Thanks again!

Clarification of Answer by pafalafa-ga on 18 Feb 2006 19:51 PST

Crist Associates, who was cited in one of the earlier articles, above,
seems to be the key source of information on trends in corporate
executives in large firms.

Some of their 2005 stats are cited in the articles, below.  I hope
these will meet your need for more up-to-date information.

However, I have to confess to not having been able to locate an
article on this topic in major news sources....I looked, but nothing
showed up.

Let me know if these work for you:
Pacific Business News
March 25, 2005 

COOs become obsolete as corporations reorganize

...Missing from the executive hierarchy: chief operating officer.

...Within the past year, Hawaii businesses have been among scores of
companies nationwide that have eliminated the COO post, according to a
study by Crist Associates, a Chicago recruiting firm.

...As chief financial officers are rising to new prominence, and CEOs
are pressured to get more involved in day-to-day operations, the work
of the COO -- long seen as the most hands-on person in the executive
suite -- is shifting to others.

...Our annual research study examines the volatility of movement at
the CEO, COO, and
CFO levels of the top public companies in the United States. Our
sample group includes
companies listed on the 2005 Fortune 500, S&P 500, or both ? a total
of 662 companies.

[graph] ...COO Volatility 1995 - 2005

...The number of COOs has been declining since 1999.


Again, let me know if there's anything else I can do for you.

robbyg-ga rated this answer:5 out of 5 stars
Thorough, thoughtful, rapidly conducted.  Demonstrated high levels of
responsiveness. Appreciated the on-target work.

There are no comments at this time.

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