Careers: Business/Perspective Management
What are the levels of management?
LEVELS OF MANAGEMENT
Every business organisation, irrespective of its size, has many managerial positions in its structure. These positions are created through the process of delegation of authority from top to lower levels. Each position is marked by authority, responsibility, functions, roles and relationships. The contents and nature vary, depending in the level at which the position lies. As one moves upward in the organisation, the managerial position plays an important role, larger the contribution, greater the authority and higher the responsibility. These managerial
positions lying in the chain of command may be classified into various groups or levels of management. Broadly speaking, an organization has two important levels of management, namely functional and operative. The functional level is concerned with the process of determining primary objectives, formulating basic policies, making vital decisions and controlling and coordinating activities of personnel.
The operative level of management is related to implementation
of plans and decisions, and pursuit of basic policies for achieving the objectives of the organisation.
Generally, the levels of management consisting of various managerial positions in the structure of an organisation, differ from one organisation to another, depending on the size of business activity, philosophy of management, span of control and other related factors.
But, in a joint stock company, for conducting its business efficiently, managerial personnel may be placed in three levels, that is, top, middle and lower or supervisory level.
Top Level Management
The top level management is generally occupied by the ownership group. In a joint stock company, equity shareholders are the real owners
of the company. Thus, they elect their representatives as directors, form a board, known as board of directors, which constitutes the top
level of management. Besides the board, other functionaries including managing director, general manager or Chief executive to help directors,
are included in this level. It is the highest level in the managerial
hierarchy and the ultimate source of authority in the organisation. The top level managers are accountable to the owners and responsible for overall management of the organisation. The major functions of the
top level management are as under:
(i) To make a corporate plan for the entire organisation covering
all areas of operations.
(ii) To decide upon the matters which are vital for the survival, profitability
and growth of the organisation such as introduction of
new product, shifting to new technology and opening new plant
(iii) To decide corporate goals.
(iv) To decide structure of organisation, creating various positions
(v) To exercise overall managerial control through the process of
reviewing over all financial and operating results.
(vi) To make decisions regarding disposal and distribution of profits.
(vii) To select key officials and executives for the company.
(viii) To coordinate various sub-systems of the organisation.
(ix) To maintain liaison with outside parties having a stake in business
such as government, trade union and trade associations etc.
(x) To formulate basic policies and providing direction and leadership
to the organisation as a whole.
Middle Level Management
In order to fill up the gap which exists between functional and operative level, some managerial positions are created at the middle level of management. Middle level management consists of departmental managers,
deputy managers, foreman and administrative officers etc. These
executives are mainly concerned with the over all functioning of their respective departments. They act as a link between top and lower level managers. The activities of middle level managers centres around determining departmental goals and devising ways and means for accomplishing them.
The main functions performed by these managers are as under:
(i) To prepare departmental plan covering all activities of the
department within the basic framework of the corporate plan.
(ii) To establish departmental goals and to decide upon various ways and means for achieving these goals to contribute to organizational goals.
(iii) To perform all other managerial functions with regard to
departmental activities for securing smooth functioning of the
(iv) To issue detailed orders and instructions to lower level managers
and coordinate the activities of various work units at lower
(v) Middle level managers explain and interpret policy decisions
made at the top level to lower level managers.
Lower Level or Supervisory Level Management
Lower-level management is known as supervisory management,
because it is concerned mainly with personal oversight and direction of operative employees. It consists of factory supervisors, superintendents,
foremen, sales supervisors, accounts officers etc. They directly
guide and control the performance of rank and file workers. They issue orders and instructions and guide day to-day activities. They also represent the grievances of the workers to the higher levels of management.
Supervisory management performs the following functions:
(i) Planning of day to day work
(ii) Assignment of jobs and issuing orders and instructions
(iii) Supervising and guiding workers
(iv) Maintaining close personal contacts with workers to ensure
discipline and team-work
(v) Evaluating operating performance
(vi) Sending reports and statements to higher authorities
(vii) Communicating the grievances and suggestions of workers to higher authorities.