General Management
Corporate executive managers have gotten quite a lot of recognition during
the past decade or so. First in the go-go 1990s, when seemingly every
public company's stock was on its way to the moon, and the press looked
upon CEOs and other corporate-executive types as the new rock stars. And
more recently, in the years since, a time in which corporate America has
been rocked by scandal after scandal, and many of the same executives who
were looked on as geniuses in the 1990s have became infamous for their
greedy ways. (Martha Stewart, anyone?)
Executive managers are the people at the highest levels of the company.
They chart the company's strategic direction, decide on what processes
the company will use to pursue that strategy, then lead the rest of the
company's employees through the day-to-day tasks necessary to move the
company in that direction. Working with the board of directors, who
represent the shareholders of the company, they make decisions about things
like what mix of products and/or services the company will sell, how the
company will allocate its resources, what markets the company will go
after, and how the company will finance its operations. A company's top
managers include everyone from the CEO (chief executive officer), the CFO
(chief financial officer), the CIO or CTO (chief information officer or
chief technology officer-the head of IT), and the COO (chief operating
officer) to the president, the treasurer, the controller, and the top
sales, marketing, human resources, legal, and other executives.
These are the people at the top of the corporate ladder. These days, many
of them achieve fame even outside the world of business (think: Bill Gates,
Larry Ellison, Jack Welch). Whether famous or not, most all of them have
extensive experience in their industry, in their career function (e.g. the
CFO typically knows accounting in and out), and/or as leaders; indeed,
their knowledge about an industry and their ability to provide direction
can mean the difference between an organization's success and failure.
In exchange for all this responsibility, they often earn a pretty penny.
We've all heard of the ridiculous sums of money CEOs at many companies
make these days, but all the members of any company's executive team
typically make more money than everyone else at the company. The flipside,
of course—at least at public companies—is that when things don't go
well for the company, the shareholders can toss the executives to the curb.
What You'll Do
For the most part, corporate executives control how an organization
operates. They develop corporate structures and policies, direct and
coordinate employee activities, find and develop alliances with suitable
business partners, raise money to grow their organizations, and make
systematic changes, as needed, to keep their businesses profitable. Without
their guidance, a company could flounder.
Executive managers are expected to see and understand the big picture. The
health of a company rests firmly on their shoulders. They develop the
strategies that will result in success or failure for their organizations.
The top execs also need to be their companies' biggest advocates. They
communicate the value of their organizations to the outside world, telling
the press why people should care about their products, marketing, strategy,
and goals. Employees, strategic partners, shareholders, and even a
company's chairperson rely on the executive management team to promote
the company's interests at every turn. These top managers give their
subordinates a reason to want to work for them. They instill a sense of
pride in shareholders.
Small businesses and startups often have limited management teams. The
founders, who take on the titles of CEO and president, typically lead such
companies. As a company grows and departmentalizes, the executive
management function is divided into a family of positions.
While the CEO and president remain committed to the overall mission of the
organization, other positions have more specialized responsibilities. Some
examples are the chief operations officer (COO), chief financial officer
(CFO), chief technical officer (CTO) or chief information officer (CIO),
and general manager (GM). Underneath them are department heads who run
specific areas of an organization, such as marketing or human resources.
They in turn hire and oversee managers who handle the day-to-day
supervision of lower-level employees.
In this way, larger corporations have developed a well-defined chain of
command. Lower-level employees answer to operational managers, who oversee
their daily work. Many firms have several layers of frontline and middle
managers. Such supervisors are responsible for managing the functions of an
organization. They set project goals, make hiring decisions, settle staff
disputes, and ensure that deadlines are met.
Operational managers report to department heads who set policy and
determine the goals of their divisions. Department heads answer to the
executive officer who controls their area of specialty. For example, the
heads of Web development and information technology usually answer to the
CTO.
Executive officers work together to set the goals and policies of a
corporation. Their work is overseen by the general manager or president,
who supervises the entire organization. Above them is the CEO, the
highest-ranking manager. The CEO is held accountable for all aspects of the
business. However, the CEO still has to answer to the board of directors.
In publicly held corporations, the board is ultimately responsible for the
success of an organization. Members of the board have a fiduciary
responsibility to look after the stockholders' (owners') interests
first and foremost. If the company begins to falter, they have the right
and the duty to correct the situation using any means possible, up to and
including firing the CEO or any other top executive. In some cases, the
board takes control of all managerial functions until a business has
stabilized.
Who Does Well
Executives can be found in every industry and organization, from publicly
held companies to nonprofits and governmental agencies. Before entering
management, would-be execs first need to prove themselves in their core
industries. Usually, they work for a time as operations managers, then
slowly work their way up the corporate ladder.
Executives can expect to be in the spotlight most of the time. Every
decision they make and every policy they set is subject to scrutiny by
those around them. There will be no place to hide. CEOs and presidents of
large organizations are the stars of the corporate world. They receive
almost as much attention and scrutiny as Hollywood movie stars.
The trade press follows an exec's every move closely. Employees and
shareholders want to know the the top execs' vision for the company,
their management style, and how much money they made last year. As long as
profits are up, they can do no wrong. But even a slight blip in the markets
can change public perception. They are often the first to be let go.
However, the public dismissal of a senior executive will be padded by a
large settlement offer and the exec's equity in the company-the
so-called "golden parachute."
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There is no completely typical path into senior management. Some executives
have worked for a single company for their entire career; others had
careers as investment bankers before becoming executives in industry. In
general, though, they must have significant experience in industry and
management. While it's possible to find executives in corporate
American who don't even have a college degree, an MBA or other advanced
degree from an Ivy League or top-ten school is a fairly typical pedigree
for those who end up in these positions at Fortune 500 companies.
Successful top managers have a variety of styles. Some are charismatic
leaders who inspire their employees to reach their highest potential.
Others are excellent behind-the-scene operators who delegate authority to
their managers. Most successful executives have developed strong written
and oral communication skills, the ability to make others feel at ease, and
a strong, focused sense of purpose. Furthermore, they know how to get
things done and aren't afraid to rock the boat to do so.
Long hours and extended travel are expected. Many execs are on the road
more than 90 percent of the time, visiting national and international
offices, attending meetings and conferences sponsored by associations,
monitoring operations, meeting with customers, and attending trade shows.
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According to the U.S. Bureau of Labor Statistics, positions for top
executives will grow at about the same rate as jobs overall between 2004
and 2014. But competition for these positions is always competitive. These
roles have a high profile and pay well, often with significant bonuses and
stock ownership accompanying six-figure salaries. (At Fortune 500
companies, salaries often start at the seven-figure level). The best
opportunities will go to managers who have proven track records for
improving their company's efficiency and competitive edge. Beware,
however, because managers who fail to perform are often let go after short
tenures.
If you can manage to make your way to a top management position, you'll
be in a comfortable place career-wise. High-level execs receive many
corporate perks, including spacious offices, administrative support, large
severance packages, and subsidized worldwide travel. The hours can be long
and pressure intense, but the financial incentives are commensurately rich.
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The responsibilities of people in these roles vary depending on the size
and type of the organization. Smaller companies and startups usually have a
few key executive positions. As an organization grows and diversifies,
senior management duties will be broken up into a family of positions,
which become increasingly specialized as the business grows larger. Many
large companies have management-training programs, where college graduates
rotate through different company divisions, gaining the background and
perspective on different functions necessary to succeed as executive
managers. The following are descriptions of positions you can find in most
publicly traded companies.
Chief Executive Officer (CEO)
A CEO is the highest-ranking manager in a company. Most are offered
near-total autonomy in handling the day-to-day affairs of their
organizations. All staff members work under their authority.
CEOs of publicly traded companies must answer to a board of directors. The
board sets the standards by which a CEO must live. Board members can order
a CEO's dismissal if they feel that he or she is not meeting the
objectives they've set.
A CEO has to have a clear vision for the future of the company, and express
that plan to employees, shareholders, and business partners, inspiring them
all with confidence. CEOs must be able to raise money by getting venture
capitalists to buy into their dreams, or Wall Street to underwrite a bond
offering worth hundreds of millions of dollars. When necessary, CEOs will
ruffle feathers. They know how to get things done and are willing to do
whatever it takes.
Some CEOs are more involved in their companies than others. In small
organizations, the CEO may be part of day-to-day operations. Other CEOs
concentrate on promoting their companies by giving speeches, attending
trade shows, cultivating the press, and acting as evangelists for their
companies. They leave the direct management work to the president and
general manager.
President
Working directly under the CEO, the president manages the daily operations
of a company. While the CEO is the organization's superstar, the
president works behind the scenes to make sure nothing gets bogged down in
operations. He or she understands the corporate structure, how the industry
is shaped, and what the primary objectives of the company are. The
president interprets the vision expressed by the CEO and puts it into
language that can be followed by everyone within the organization. Most of
the president's time is spent working with other executive officers,
particularly the COO. Together they ensure that the company's main
goals are being achieved. The president's job is demanding and full of
pressure. Those who succeed in it are often promoted to the CEO level.
Chief Operations Officer (COO)
The COO works directly under the president and CEO. His or her primary job
responsibility is to oversee department heads and other key executives.
Together they establish the operational policies for an organization. The
COO makes sure everything runs smoothly. As needed, he or she provides
reports on operational functions.
While the chief operations officer's role is crucial, it is not one
that receives a lot of press. As long as operations go as expected, the COO
is left to his or her own devices. Successful COOs can be promoted to
president or CEO.
General Manager
General managers fill a role similar to that of the president and COO.
Typically, GMs work for manufacturing companies and oversee their
day-to-day operations. They spend most of their time in the office, working
with department heads and other chief executives. Their primary function is
to understand how their businesses operate and how to achieve or maintain
their long-term economic viability. GMs analyze financial data and are
responsible for producing profit and loss statements. They directly oversee
the product development, operations, finance, sales, marketing, and
purchasing departments. GMs answer directly to the president, or possibly
the CEO, and are often first in line for such positions if they become
available.
Most GMs are seasoned managers with strong financial backgrounds. They may
have worked at various positions within their organizations. At the very
least, potential applicants must have significant industry experience. As
with any other executive position, general managers are expected to perform
at all times. Any decline in profits can lead to their termination.
Chief Financial Officer (CFO)
The CFO is responsible for managing and analyzing all the financial
resources of an organization. He or she works with the CEO and other chief
executives to plan and implement strategies that will maintain the
company's success. CFOs determine how much capital their companies need
to have on hand to operate properly. They also reinvest corporate profits
in safe, but lucrative, business opportunities. Some other possible
responsibilities include raising capital, acquiring or merging with other
businesses, taking a company public, and analyzing changing tax laws.
CFOs usually have extensive accounting and finance backgrounds. They are
detail oriented and highly analytical. Possible promotion opportunities
include becoming a COO, general manager, or president.
Chief Technology Officer (CTO) or Chief Information Officer
(CIO)
CTOs and CIOs develop an organization's short- and long-term
information technology goals. A CTO or CIO must keep abreast of
technological developments in his or her industry, develop
technology-related product strategies, evaluate development options,
establish strategic partnerships, negotiate licensing arrangements, and
manage all intellectual property-related matters. CTOs and CIOs work with
their CFOs and COOs to determine which technologies meet the needs of
employees without breaking their companies' budgets.
Besides having a strong technical background, the CTO or CIO must be an
accomplished manager. The most important skill for CTOs and CIOs is the
ability to analyze changing technologies and predict how future advances
will affect a company's business model.
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Compensation varies widely in top management, depending on the
manager's skills, the size of his or her company, and the type of
industry a given business is involved in. Senior managers often have
significant stock-option grants, and can receive bonuses that exceed their
base salaries if their companies perform well. The compensation ranges
listed below are typical:
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Chief executive officer: $150,000 to $3,500,000
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Chief financial officer: $150,000 to $2,000,000
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Chief operations officer: $150,000 to $2,000,000
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Chief information officer: $125,000 to $1,000,000
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Treasurer: $75,000 to $500,000
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President: $75,000 to $1,000,000
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General manager: $75,000 to $500,000
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Division manager: $75,000 to $500,000