Levels of Management are a term referred to line of differentiation among various administrative positions in a company. The levels may increase as and when the size of the business increases and vice versa. Level of Management determines the chain of control and the quantity of power and position that is given to any management role to an individual in an organization.
Levels of Management are broadly classified into three:
- Top level management
- Middle level management
- Lower level management
Top level management
Since majority of the large scale undertakings are organized as joint stock companies, the top level management is made up of Board of Directors. However, in practice the Directors do not take part in the day-to-day affairs of the enterprise.
But the task is generally entrusted to the Managing Directors or General Managers. They are called as Chief Executives and they are responsible to carry out the broad policies formulated by the Board. However, the ultimate control rests with Directors. This top level management is the policy making body responsible for the overall direction and success of all the activities of the company.
It includes Board of directors, Chief executive or General managers, Decision-making Directors. Corporate level goals, missions and objectives are determined.
Functions of the Top Management
- To formulate and determine the objectives and define the goals of the business.
- To establish policies and prepare plans to attain the goals.
- To set up an organizational structure to conduct the operations as per the plans.
- To provide the overall direction in the organization.
- To assemble the resources necessary for the attainment of the policy and execution of the plan.
- To control effectively the business operations.
- To judge and evaluate the results.
Middle level management
The Middle Level Management consists of the Departmental Heads (HOD), Branch Managers, and the Junior Executives. The Departmental heads are Finance Managers, Purchase Managers, etc. The Branch Managers are the head of a branch or local unit. The Junior Executives are Assistant Finance Managers, Assistant Purchase Managers, etc. The Middle level Management is selected by the Top Level Management.
Functions of the Middle Management
- It gives recommendations (advice) to the top level management.
- It executes (implements) the policies and plans which are made by the top level management.
- It co-ordinate the activities of all the departments.
- They also have to communicate with the top level Management and the lower level management.
- They spend more time in co-coordinating and communicating.
- They prepare short-term plans of their departments which are generally made for 1 to 5 years.
- It has limited authority and responsibility. They are intermediary between top and lower management. They are directly responsible to the chief executive officer and board of directors.
- Require more managerial and technical skills and less conceptual skills.
Lower level management
It includes supervisors, foremen and workers. it is also known as ‘supervisory level’ of management in which the supervisors or foreman like sales officers, account officers etc take responsibilities of the implementation and control of the operational plans developed by the middle level managers. They provide the essential link between the worker and the management. In fact, the efficiency of the whole organization depends on the efficiency of the lower management. Hence, they are also designated as ‘operating management’.
Functions of the Lower Management
- To issue the orders and instruction to the workers to supervise and control the performance.
- To plan the activities of the sections.
- To direct and guide the workers about the work procedures.
- To provide job training to the workers.
- To arrange the necessary tools, equipment, materials for the workers and look after their proper maintenance.
- To solve the problem of workers.
- To develop sense of cooperation and high group spirit among the workers.
- To advise the middle level about the work environment.
- To inform the unsolved problems of the workers to the middle level management.