Thomas Bonney of CMF Associates wrote a piece for the deal.com examining the increasing reduction of barriers between the cfo and coo positions in many companies. Bonney wrote,
CFO and COO role shifts are most frequently on the rise at companies where there is a weakness in leadership at either position. The challenges of the current economic environment have exposed individuals who have reached the peak of their functional level competency and are unable to develop a broader skill set that extends across functions; these individuals are increasingly being terminated by boards and private equity firms in conjunction with overall talent upgrade initiatives to deal with tougher times.
Another driver behind the blending of the CFO and COO roles is businesses’ heightened need for rapid and accurate decision-making, despite an environment that fosters fewer reliable, relevant facts. External competitive and economic pressures are resulting in increased financial and operational ambiguity, while, at the same time, mandating better executive judgment calls. In the sub-$100 million revenue world of the middle market, this decision-making must cross functional lines, thus further blurring the line between CFO and COO responsibilities.
The article should be read by anyone interested in corporate management.
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