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Chief executive officer, president, executive vice president, partner, financial institution president, brokerage office manager, college president, school superintendent, and police chief-all are examples of general managers and top executives who formulate the policies and direct the operations of corporations, nonprofit institutions, and government agencies. (The chief executives who formulate policy in government are discussed in detail in the Handbook statement on government chief executives and legislators.)
The fundamental objective of private for-profit companies is to make a profit for their shareholders or owners, or to increase shareholder value. Nonprofit organizations and government agencies must effectively implement programs that further their causes or policies within budgetary constraints and shifting public priorities. General managers and top executives work to ensure that their organizations meet these objectives.
A corporation's general goals and policies are established by the chief executive officer in collaboration with other top executives, who are overseen by a board of directors. In a large corporation, chief executive officers must frequently meet with other executives of the corporation to ensure that operations are being carried out in accordance with the organization's policies. Although the chief executive officer of a corporation retains overall accountability, a chief operating officer may be delegated the authority to oversee the executives who direct the activities of various departments and are responsible for implementing the organization's policies in these departments on a day-to-day basis. In publicly-held corporations it is the board of directors that is ultimately accountable for the success or failure of the enterprise, and the chief executive officer reports to the board. In nonprofit corporations, the board of trustees fulfills the same role.
The scope of other high level executive's responsibilities depends greatly upon the size of the organization. In large organizations, their duties may be highly specialized. For example, they may oversee managers of marketing, sales promotion, purchasing, finance, personnel, training, industrial relations, administrative services, electronic data processing, property management, transportation, or legal services departments. (Some of these and other managerial occupations are discussed elsewhere in this section of the Handbook.) In smaller firms, the chief executive or general manager might be responsible for all or a number of these functions.
Middle managers, in turn, direct their individual departments' activities within the framework of the organization's overall plan. With the help of supervisory managers and their staffs, these managers oversee and motivate their workers to achieve their departments' goals as rapidly and economically as possible. In smaller organizations, such as independent retail stores or small manufacturers, a partner, owner, or general manager may be responsible for all purchasing, hiring, training, quality control, and other day-to-day supervisory duties. (See the Handbook statement on retail managers.)
General managers in large firms or government agencies are usually provided with offices close to the top executives to whom they report. Top executives are generally provided with spacious offices and secretarial and support staff. Long hours, including evenings and weekends, are the rule for most top executives and general managers, though their schedules may be flexible.
Substantial travel is often required of managers and executives, who may travel between national, regional, and local offices or overseas to monitor operations and meet with customers and staff and other executives. Many attend meetings and conferences that are sponsored by associations which provide an opportunity to meet with prospective customers and keep abreast of technological and other developments.
In large corporations, frequent job transfers between local offices or subsidiaries are common. With increasing domestic and international competition, general managers and top executives are under intense pressure to attain ever higher profit, production, and marketing goals. Executives in charge of poorly performing companies or departments generally find their jobs in jeopardy.
General managers and top executives held over 3 million jobs in 1994. They are found in every industry, but wholesale and retail trade and services industries employ over 6 out of 10.
The educational background of managers and top executives varies as widely as the nature of their responsibilities. Many general managers and top executives have a bachelor's degree or higher in liberal arts or business administration. Their major often is related to the departments they direct-for example, accounting for a manager of finance or computer science for a manager of information systems. Graduate and professional degrees are common. Many managers in administrative, marketing, financial, and manufacturing activities have a master's degree in business administration. Managers in highly technical manufacturing and research activities often have a master's degree in engineering or a doctoral degree in a scientific discipline. A law degree is mandatory for managers of legal departments; hospital administrators generally have a master's degree in health services administration or business administration. (For additional information, see the Handbook statement on health services managers.) College presidents and school superintendents generally have a doctorate, often in education administration. (See the Handbook statement on education administrators.) On the other hand, in some industries, such as retail trade or transportation, it is fairly common for individuals without a college degree to become managers.
In the public sector, many managers have liberal arts degrees in public administration or one of the social sciences. Park superintendents, for example, often have liberal arts degrees, while police chiefs are generally graduates of police academies, and hold degrees in police science or a related field.
Since most general manager and top executive positions are filled by promoting experienced, lower level managers, many are promoted from within the organization. Some companies prefer that their top executives have specialized backgrounds and hire individuals who are managers in other organizations. Qualities critical for success include leadership, self-confidence, motivation, decisiveness, flexibility, the ability to communicate effectively, sound business judgment, and stamina.
Advancement may be accelerated by participation in company training programs to gain a broader knowledge of company policy and operations. Through attendance at national or local training programs sponsored by various industry and trade associations and by continuing education, normally at company expense, managers can become familiar with the latest developments in management techniques and improve their chances of promotion. Every year, thousands of senior managers, who often have experience in a particular field, such as accounting, engineering, or science, attend executive development programs to facilitate their promotion from functional specialists to general managers. Participation in interdisciplinary conferences and seminars can expand knowledge of national and international issues influencing the firm and can help develop a network of useful business contacts.
General managers and top executives must have highly developed personal skills. An analytical mind able to quickly assess large amounts of information and data is very important, as is the ability to consider and evaluate the interrelationships of numerous factors. General managers and top executives also must be able to communicate clearly and persuasively with customers, subordinate managers, and others.
General managers may advance to top executive positions, such as executive vice president, in their own firm or they may land a corresponding position in another firm. They may even advance to peak corporate positions such as chief operating officer or chief executive officer. Chief executive officers and other top executives often become members of the board of directors of one or more firms. Typically the chief executive is also a director of his or her own firm and often chairs the board of directors. Some general managers and top executives go on to establish their own firms or become independent consultants.
Employment of general managers and top executives is expected to grow about as fast as the average for all occupations through the year 2005 as new companies start up and established companies seek managers who can help them maintain a competitive edge in domestic and world markets. In addition, because this is a large occupation, many openings will occur each year as executives transfer to other positions, start their own businesses, or retire. Nonetheless, competition for top managerial jobs will be keen. Many executives who leave their jobs transfer to other executive or managerial positions, limiting openings for new entrants. Continued management efforts to downsize and restructure-resulting in layoffs of, mostly, middle managers-will add to an ample supply of competent managers seeking positions.
Projected employment growth of general managers and top executives varies widely among industries. For example, employment growth is expected to be faster than average in all services industries combined, but only about as fast as average in all finance, insurance, and real estate industries combined. Employment of general managers and top executives is projected to decline in manufacturing industries overall. Because of the growing importance of the global market, overseas experience may give a prospective general manager an edge in seeking additional responsibility.
Experienced managers whose accomplishments reflect strong leadership qualities and the ability to improve the efficiency or competitive position of an organization will have the best opportunities. In an increasingly global economy, certain types of experience, such as international economics, marketing, information systems, or knowledge of several disciplines, will also help.
General managers and top executives are among the highest paid workers in the Nation. However, salary levels vary substantially depending upon the level of managerial responsibility, length of service, and type, size, and location of the firm.
At the highest level, chief executive officers (CEOs) of medium and large corporations are extremely well paid. Salaries often are related to the size of the corporation-a top manager in a very large corporation can earn significantly more than a counterpart in a small firm. Total compensation often includes, in addition to salaries, stock options and dividends, and other performance bonuses.
Salaries also vary substantially by type and level of responsibilities and by industry. According to a salary survey by Robert Half International, senior vice presidents/heads of lending in banks with $1 billion or more in assets earned about $200,000 in 1995. Based on a survey sponsored by the Administrative Management Society, the average salary for managers of large plants with more than 500 employees ranged from $70,000 to $108,000 in 1994. In the nonprofit sector, three quarters of the CEOs make under $81,700, according to a survey by Abbott, Langer, & Associates.
Company-paid insurance premiums and physical examinations, the use of executive dining rooms and company cars, and expense allowances are among benefits commonly enjoyed by general managers and top executives in private industry. CEOs often enjoy company-paid club memberships, a limousine with driver, and other amenities. CEOs of very large corporations may have the use of private aircraft.
General managers and top executives plan, organize, direct, control, and coordinate the operations of an organization and its major departments or programs. The members of the board of directors and supervisory managers are also involved in these activities. Occupations in State and local government with similar functions are governor, mayor, commissioner, and director.
For a wide variety of information on general managers and top executives, including educational programs and job listings, contact:
American Management Association, 135 West 50th St., New York, NY 10020.
National Management Association, 2210 Arbor Blvd., Dayton, OH 45439.
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