At this point, you’ve decided when to hire a COO, what to look for in a COO, how to hire a COO, and asked candidates some extraordinary interview questions. Now that you’ve narrowed the search to a few candidates, it’s time to decide what to pay a COO.
When it’s time to determine the salary of a chief operating officer, there are many factors to consider. Lots of circumstances can influence what to pay a COO. Here are four crucial things to consider when determining an appropriate salary for your new executive.
1. COO salaries in your field
If you’re unsure what to pay a COO, asking around is a good way to start. Reach out to trusted members of your network and ask them for tips on negotiating salary. They may be able to give you some insight into the average payment for a chief operating officer. By knowing what salary is considered “average” for a COO in your field, you have a good starting place to begin negotiations.
2. Your location
The position’s location has a significant impact on salary expectations. If your company operates in an area with a higher cost of living than the national average, expect to compensate employees with a higher salary. This way, you can stay competitive in your area and ensure that your chief operating officer makes an appropriate wage.
Ideally, your potential COO will have unique skills that can push your company forward. Since these types of skills are valuable to your company, a COO with a unique skill set is a valuable employee. Prepare to offer a higher salary in order to attract the most talented chief operating officer available.
A proven track record also adds value to a COO. If the candidate has COO experience prior to becoming your chief operating officer, he or she has likely proven that they are capable of helping a company grow. Since a highly experienced candidate is in a good position to make your company successful, their value as a chief operating officer increases.
4. Additional compensation
Many organizations offer equity, stock options, bonuses, or other benefits to their chief operating officer. If you offer any of these benefits, remember to account for their value when deciding what to pay a COO. These benefits can be an important factor for a candidate, so be sure to mention them early on in the process.
What factors did you use to decide what to pay a COO? Let us know in the comments.
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