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Cost-Cutting Companies Target No. 2 Execs
Corporations eliminate second-in-command roles to save on costs
By Jason Farago
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Posted Sep 21, 09 8:27 AM CDT
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(Newser)
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Cost-cutting at American's largest corporations is hitting the executive suite, with CEOs rolling up their sleeves to take on more day-to-day responsibilities and laying off their No. 2s. In the 18 months leading up to June 2009, 40 major companies eliminated COOs or presidents, the Wall Street Journal notes, while only 20 added. "The CEO wants to be closer to the action," one headhunter said.
GM, Coca-Cola, Alcoa, and Starbucks have all eliminated their second-in-command posts. At AOL, new chief Tim Armstrong created a COO position in July only to eliminate it last week, splitting duties among several senior leaders. Many execs like to talk about hands-on leadership as the impetus, but one former COO said the recession means "the board looks to the CEO to be more directly involved."