Chief Administrative Officer: What They Do and When to Hire
Companies that are considering hiring C-Suite leaders for the first time often find many positions confusing. The Chief Administrative Officer (CAO) is one such position. Many startups are not clear whether they should hire a CAO or a COO (Chief Operating Officer). What are Chief Administrative Officers? What are the outcomes a CAO could influence, and what can you expect from such a leader? These are some questions that the blog answers. Also, find out how to go about CAO recruitment. Would you need a CAO recruiter?
A chief administrative officer (CAO) is a top-tier executive who oversees the daily operations of an organization and is ultimately responsible for its performance.
Found in many industries, a CAO is a management professional responsible for providing input in business and strategic planning, setting goals for departments and individual managers, collaborating with colleagues to implement policies and develop improvements.
The substantial industry experience of CAOs enables them to organize and coordinate inter-and intradepartmental operations, provide guidance to directors and heads of departments, oversee resource allocation and budgeting and resolve issues that may arise between departments or teams. As per many media reports, by 2028, the career of a CAO is expected to grow 7%, producing 21,800 job opportunities across the US.
CAO vs. COO
The role of a CAO differs from that of a COO or Chief Operating Officer in many ways, although some responsibilities may appear similar. That is why in some companies, they appoint a CAO and not a COO, while in others, a COO is appointed but not a CAO. Such practices increase the confusion regarding both these positions.
To give a clear idea, we have highlighted the differences.
A CAO supervises the day-to-day operations of a company and is generally found in companies with a high level of customer interactions, such as IT, financial services, etc. A COO has overall responsibility for enterprise-wide operations, focusing more on improving metrics like operational efficiency, productions efficiency, operational cost optimization, etc.
Numerous manufacturing companies have a COO but not a CAO to oversee overall operations – product development, manufacturing, logistics, customer order management, and sales.
Many large companies with different business lines and wide spheres of operations have both a CAO and a COO.
A COO must possess excellent strategic and decision-making skills since their job largely constitutes facilitating improvements to a company’s operations. A CAO would be focusing on overseeing that the actual management of routine operations is going on without hassles, setting goals for departments and individual managers, and collaborating with colleagues to implement policies and develop improvements.
While both the officers report to the Chief Executive Officer (CEO), their roles involve different levels of communication with the CEO.
A CAO gives updates to the CEO, holds briefing meetings, and facilitates communication between the CEO and other department heads or staff members, but the COO communicates directly with the CEO about strategies, updates, and improvements that affect the company as a whole.
Overview About Chief Administrative Officer
A CEO focuses on business expansion, value transformations, and growth strategies. There is a void with regards to who could take control of guiding, mentoring, leading, and directing the operations directors, heads of departments, and middle management about seamless management of day-to-day operations. That’s where a CAO comes in.
For example, if a huge project involves interdepartmental resource allocation and the development of new process chains, a CAO is consulted. When the C-Suite revises departmental goals and targets, the CAO coordinates with the different departmental heads and directors to escalate goals down to the employee levels and implement the right policies and develop improvements.
The position also needs a brilliant staff to support a range of supervising, reporting, monitoring, and analysis activities. A CAO manpower agency will help you find the right CAO and the staff for the CAO office.
What Does A CAO Do?
1) Oversees and Improves Administrative Activities Management
You need a CAO to oversee how certain departments with customer-facing interactions or influencing tasks related to core functions like sales, finance, human resources, customer service, business, and office administration are functioning.
In the UK or in the North Americas, for CAO recruitment, companies seek candidates who are chartered secretaries from institutions such as Chartered Governance Institute or who are certified/chartered accountants or others with equivalent experience.
When considering hiring a CAO, it is best to consult with a CAO recruiter and find out what kind of talent is sought in your country and in the industries you serve.
2) Plays an Important Role in Enhancing Operational Efficiency
You need a CAO to take a top-level authority role on how the processes across departments are managed. What are the issues that affect the maintenance of compliance with the right standards, policies, process flows, etc., and how could the issues be solved – these are questions a CAO can address.
Here’s an example. A CAO would not be worried about targets related to marketing lead conversion and funnels but would demand marketing directors to report about how they are managing the CRM, what kind of complaints are coming from customers related to order management, etc.
Find out how a CAO could help you achieve the departmental operations efficiency goals. A CAO recruiter would help you understand and frame the right roles and responsibilities using mechanisms like market CAO talent mapping and research.
3) Helps Align All Human Resource Policies And Internal Reporting Standards with Business Goals
The CAO position involves an in-depth knowledge of the inner workings of the company by blending analytics with strategic procedures.
He or she must provide leadership to improve human resource initiatives and try to introduce and manage employee-benefit programs such as in-house clinical billing or collection operations. Although CAOs do not have the final say in the selection process, their involvement is equally important to build up a strong administration.
A CAO’s support in an organization’s operational capacity through accountability, research and evaluation, and instructional technology in accordance with human resource policies is a crucial requirement for the attainment of respective business goals.
4) Ensures Maintenance of Fair Practices – Audits, Protocols, Etc
The Chief Administrative Officers are responsible for recognizing, evaluating, and managing risks to an organization’s resources and profits by ensuring the maintenance of fair practices within the organization.
To mitigate risks, a CAO must not only oversee but participate in the development and implementation of a comprehensive risk management system. He or she must provide technical and risk management assistance to guide the development of policy and protocol by managing audits, advising and briefing senior management on potential business exposures, developing data warehouses by a comprehensive portfolio performance analysis, and improving operational risk management.
5) Sets the Standards and Framework To Ensure All Compliance Work is Managed Correctly
One of the key responsibilities of a CAO involves evaluating and ensuring compliance with policies, practices, and standards to meet business objectives within legal requirements.
To ensure compliance with corporate policies and directives within regulatory and internal policy requirements, a CAO must lead an internal inspection program like annual reviews, a complete audit of all unit directives and instructions in accordance with current laws, regulations, and procedures, and correspond with government offices for maintenance of the same.
6) Spearheads Various Business Transformation Programs
A CAO spearheads various business transformation programs by assisting with long-range financial planning and budgeting and providing projections as well as recommendations to executive officers and directors.
He or she develops strategic plans to ensure uniform and coordinated business operations, improves compliance issues within the documentation, and implements policy initiatives as well as agency-wide strategic plans through various collaborations. He may also establish a Program Management Office for tracking and enhancing all corporate initiatives/ or projects.
7) Plays a Lead Role in Ensuring Operations Stick to Budget
A Chief Administrative Officer provides leadership, strategic guidance, and facilities maintenance of the annual budget by participating in its development and widely managing the department’s resources within the budget guidelines.
A CAO might also oversee the overall financial management of a multi-site corporation, including rate negotiations, budgeting, fiscal audits, appropriate expenditures, and cost containment.
Working directly with all the department heads and the CEO, a CAO not only leads the development of the organization’s annual budget but manages and monitors the execution of funds through timely reviews in order to ensure cost controls and the accomplishment of targets.
8) Prevents and Resolves Interdepartmental Conflicts For Resources, Multi-Division Teams, etc.
Since a CAO is in a leadership position administering the workings of the whole day-to-day operations of an organization, it is imperative for him to act like a buffer and coordinate the functioning of every department.
He or she must ensure that no conflicts ensue due to any key decision and resources are equally distributed to every department. Besides working in close coordination with HR, he must also supervise multi-division teams or departments to handle information technology programs, such as website development and maintenance, e-commerce, and updating of online databases, in order to prevent any conflict.
When to Hire a CAO?
It’s important to know when to hire a Chief Administrative Officer for your business. A growing business or an already well-established company may have too many essential tasks for one person to carry out. When company size increases and its operational activities expand beyond a particular threshold, in such cases, the CEO often needs aid in the proper execution of business operations.
The Chief Administrative Officer (CAO) occupies second-in-command authority under the CEO and helps to meet the requirements in the daily administration of an organization. The CEO can fully trust the CAO and his or her team to ensure that each department is on-task and meeting its goals to achieve growth.
Alliance Recruitment Agency
To avoid major setbacks, fast-growing businesses must make a point to fill the Chief Administrative Officer position on time. You can rely on competent CAO recruiters to find professionals who meet all your requirements and expectations.
Alliance Recruitment Agency has one the best team for CAO recruitment and staffing. Our CAO recruiters and CAO manpower consultants help you find and hire not only the best-matched candidates for the position but also meet the staffing requirements of the CAO office.
Through highly personalized CAO executive search and recruitment services, your chances of finding the right leader for your organization are ensured. We also help companies hire an Interim CAO or a consultant CAO. We have a 100% track record of excellence in recruitment services delivery.
Our agency also offers CAO manpower consultancy services to help you fill all the CAO office staffing needs.
If you are looking for a CAO for your company, please get in touch with us. We will be glad to assist you!