What’s it: Top-level management is the highest position in a company. The president director, finance director, and marketing director are examples. They are responsible for the company as a whole. They set the company’s overall direction, articulate a vision, establish plans and strategies, and allocate resources to achieve company goals. Sometimes, we refer to them as top management or company executives.
Company executives have extensive experience and networks. They master functional disciplines and are often industry experts. As a result, their leadership greatly influences the success of the company. And they benefit from being charismatic, strong communicators with a sense of accountability, trust, integrity, and comfort. In addition, they need to be effective decision-makers because the ultimate authority is in their hands.
What are examples of top-level management?
Top-level management includes several positions. And their committee is often referred to as the board of directors or C-suite. Their titles can take several names. For example, directorship titles may include:
- President director
- Operations director
- Marketing Director
- Human resources director
- Finance director
And for C-suite, there are:
- Chief Executive Officer (CEO)
- Chief Operations Officer (COO)
- Chief Marketing Officer (CMO)
- Chief Technology Officer (CTO)
- Chief Financial Officer (CFO)
- Chief Human Resources Officer (CHRO)
The president director or Chief Executive Officer (CEO) represents the highest ranking executive and oversees other executives. He became the person responsible for the organization as a whole and became the main decision maker. Meanwhile, other positions represent the highest positions for each functional area.
What are the roles and responsibilities of top-level management?
Top-level managers have the highest authority and are responsible for the entire organization. They control and oversee how the company goes in the direction they want. They make decisions about where the business is headed. And they also develop company goals, strategic plans, and policies. In addition, they play an important role in allocating and mobilizing company resources.
In the organizational hierarchy, top-level managers are accountable to shareholders, who appoint them during the annual general meeting. Shareholders trust them to operate the company and expect to work in their interests, not personal interests. This is where, often, agency problems arise because top-level managers pursue their personal interests over the interests of shareholders.
Now, let’s break down some of the roles and responsibilities of top management:
Setting goals. Top-level managers define what the company should achieve and where it should go. They determine the company’s vision and mission.
Developing a corporate plan. Top-level managers design strategic plans to achieve goals. It provides direction and focuses for the entire organization, eventually implemented at lower levels.
Establishing company policies. Top-level managers establish, review and maintain systems and policies to ensure the organization can achieve its goals effectively and efficiently. So, organizational policies must be built on goals and aligned with company values.
Organizing activities. Top-level managers organize departments and activities throughout the organization. They regulate how these activities or parts synergize and support each other to achieve goals.
Allocating resources. Top-level managers collect and allocate resources within the company in the most efficient way. These resources include tangible assets such as hardware and intangible assets such as human capital.
Taking high risk
Top-level managers take high risks by carrying out their roles and responsibilities. Why? Their work involves high stress and high influence on the organization. What they decide not only affects their job or their salary, but it also affects everyone inside and outside the organization. For example, poor goals and plans can cause a business to fail. Finally, layoffs or business closures are the worst consequences.
In addition, what is decided by top-level managers can also impact those outside the organization. How did it happen? Take the decision to operate in an environmentally friendly manner as an example. Today, several companies have pursued environmentally friendly operations. Top-level managers have the ultimate authority to decide whether to move towards it or not.
Say top-level managers decide to adopt eco-friendly principles. They strive to balance profit, people, and the planet (triple bottom line). So, they direct the organization to implement environmentally friendly practices. Without their orders, it is impossible for the organization to operate environmentally soundly. Moreover, by adopting environmentally friendly practices, the public views positively the company’s image, which in turn has a positive impact on the success and survival of the company.
What skills are needed for top management?
Top-level managers have extensive experience and influence, both within and outside the organization. They don’t just interact with people within the company. However, they also interact with stakeholders such as government officials and supply company executives.
Top-level management masters their functional disciplines. In contrast to middle management, their work focuses on conceptual rather than managerial or technical skills. For this reason, they may be seniors in the organization with good performance. Experience, competence, and superior performance enable them to reach higher career ladders.
Or, they may also come from people outside the organization. They are competent experts. And shareholders believe they have an important ability to make the company successful. Thus, shareholders appoint them to strategic positions in the organization.
The key skills inherent in a top-level manager are:
Leadership. It is about understanding, inspiring, and encouraging people to move towards goals. Again, it may be talent or learned through life experience.
Communication. For example, top-level managers must communicate the vision they have built to their subordinates for execution. Communication is not only within the organization but with stakeholders outside the organization, such as executives at supply companies or government officials.
Change management. The business environment is constantly changing, and top-level managers must be proficient at identifying opportunities and threats. Thus, organizations are more adaptive and can maintain their competitive advantage over time.
Strategic thinking. Top-level managers develop organizational plans, which must be forward-looking to ensure future success. And it requires strategic thinking.
Decision-making. Top-level managers hold the highest authority in decision-making. Thus, they must be effective decision-makers.
Emotional intelligence. Top-level managers create an internal drive from people within the organization to move together towards their goals and support what they have planned. It ultimately fosters high commitment and loyalty among subordinates instead of relying on a reward and punishment system.
Human resource development. Top-level managers work around the team to realize their plans. They need people to be committed and have the right competencies to carry out their plans and directions. And development does not focus on a few employees but on all human resources within the organization.
Delegation. It’s not just about distributing work or less strategic decision-making to subordinates. But, it’s also a way to develop and motivate them.
What to read next
- Functional Manager: Roles and Responsibilities, Required Skills
- General Manager: Definition and Brief
- Lower-Level Management: Examples, Roles and Skills
- Management Level: Why It Matters, 3 Levels
- Management Style: Importance, Type, When Appropriate Adopted
- Management: Meaning, Five Main Functions
- Manager: Definition, Interests, Types, Functions
- Middle-Level Management: Examples, Roles, Skills
- Top-Level Management: Examples, Roles and Responsibilities, Skills