Contact information for general inquiries and feedback. Learn More. To determine what does apply, a GM focuses on two questions: What kind of managers do we need to compete effectively, now and in the foreseeable future? They do this through a network of roughly 100 tightly focused, freestanding operating companies. The best GMs willingly make the tough calls it takes to upgrade an organization. The best GMs also get deeply involved in determining their company’s values—“what it’s like to work here.” Henry Schacht, the CEO of Cummins Engine, is a good example. But their priority is avoiding that kind of situation. Being a global company, the British Airways has several branches across the globe. Since the general manager is the only executive who can commit the entire organization to a particular strategy, the best GMs are invariably involved in strategy formulation, spearheading the effort, not just presiding over it. How many GMs, for instance, would have disassembled a competitor’s entire car to show production people what they were up against, as Honda’s U.S. president did? The same kind of thinking is apparent in the comments of a top Japanese CEO who was asked by a U.S. trade negotiator how his company would compete if the yen dropped from 200 to the dollar to 160. If the GM’s standards are low or vague, subordinates aren’t likely to do much better. ORGANIZATIONAL STRUCTURE SIMPLICIO P. UMALI, JR. President & General Manager Simplicio P. Umali, Jr. (Jun), the 2011 Agora Awardee in the category of Outstanding Man of Marketing Management, is the President and General Manager … Above all, they are impossible to satisfy. And of course, there are always a few whose own values are flawed or expedient, but who are nonetheless successful in the short run. Line organization is the simplest form of organization and is most common among small companies. The authority is embedded in the hierarchical structure and it flows in a direct line from the top of the managerial hierarchy down to different levels of managers and subordinates and further down to the operative levels of workers. The general manager in the hierarchy usually falls below the vice president of operations. “We are already prepared to compete at 120 yen to the dollar,” he replied, “so 160 doesn’t worry us at all.”. They must typically: An individual in a GM role is a generalist who is familiar with all areas of the business and can coordinate processes and operations across the organization. To be successful in this role, you’ll generally need the following skills and qualities: The U.S. Bureau of Labor Statistics projects that employment in management occupations, in general, will grow 8% through 2026, which is slightly faster than the overall employment growth of 7% for all occupations in the country. But whatever the environment a general manager inherits from the past, shaping—or reshaping—it is a critically important job. Otherwise, managers will postpone action, rationalize marginal performance, or mistake the recruitment of one or two outsiders for real upgrading. They know that sustained superior performance can’t be built on one-shot improvements like restructurings, massive cost reductions, or reorganizations. Trite as it may sound, somewhere along the line, the best GMs have learned the value and impact of teamwork. Long before restructuring came into vogue, they were prepared to shift emphasis to get more bounce for their bucks. The matrix structure is a bit more confusing, but pulls advantages from a couple of different … I vividly remember one general manager who astonished subordinates by rejecting a plan that showed nice profits on a good sales gain for the third year in a row. To sum up, outstanding GMs affect their companies in six important ways. They demand reports on what’s important, not sheets and sheets of data from MIS. But when you have good people, make darned sure you listen to what they have to say.”. If business drops off sharply, they move faster than others to scale back costs, cut discretionary expenditures, and eliminate losers. The general manager typically serves as the top executive for the unit and is responsible for strategy, structure, budgets, people, financial outcomes, and scorecard metrics. A general manager usually must speak the languages of finance and accounting, operations, sales, marketing, human resources, research and development, and engineering. Every company has its own particular work environment, its legacy from the past that dictates to a considerable degree how its managers respond to problems and opportunities. A GM's salary can vary greatly depending on location, experience, and employer. The degree to which a functional manager is involved in the project depends on the form of organizational structure. Moreover, because every business environment changes over time, the best general managers constantly ask: What kind of business do we want to run? While GMs have a great deal of autonomy in operating within their business unit, they typically must justify significant investments as well as changes in key strategies or personnel. So employees don’t need policy manuals or rule books to act ethically and fairly—they just do it. They also get out of games they cannot win. In fact, very few companies do. Instead of continuing his predecessor’s practice or scaling back on his big potato chip business (as the financial vice president recommended), this GM invested a small fraction of his resources in process and productivity improvements that raised the margin on chips. General Manager responsibilities include formulating overall strategy, managing people and establishing policies. This doesn’t mean arbitrary, unrealistic goals that are bound to be missed and motivate no one, but rather goals that won’t allow anyone to forget how tough the competitive arena is. Get to know the top management skills that employers value, as well as the common challenges managers face and how to address them. But the GM told them to come back with a plan that kept the same volumes but cut base cost levels 5% below the prior year’s, instead of letting them rise with volume. Ensure the creation and implementation of a strategy designed to grow the business. At the same time, they don’t wreck the business to “make plan” in a serious downturn. GMs who ask these questions consistently and act on the answers end up with more high-impact managers than those who haven’t given much attention to the mix of skills and styles it takes to win their particular battles. Amazon organizational structure has the following three key features: 1. For years, for example, Heinz prided itself on introducing more new soups than Campbell did. This list shouldn’t be surprising; the fundamentals of a general manager’s job should sound familiar after all. To remain a leader, CEO James Burke feels that he and his managers have to excel at spotting promising new market segments early, tailoring products to serve them, and getting those products to market quickly. Academic organizational concepts won’t keep them from intruding on someone else’s territory if the stakes are crucial to the company’s success. They plunge ahead and build a factory, hire lots of overhead, and launch new products quickly and aggressively—presumably to beat competitors to the punch. He is a planner, coordinator, producer and a marketer. To begin with, they have a strategic vision for each business, or they develop one quickly when they’re appointed to a new job. Do we still have viable positions in each? Their operating plans are commitments, not just something they’re trying hard to achieve. For example, one aggressive, growth-oriented company decided it needed: a mix of high-potential managers, not a few good managers at the top with implementers below; innovative managers who act like owners, not administrators content to pass decisions up the line; and ambitious quick learners, not people content to move slowly up the corporate ladder. As a result, their activities in these areas make a coherent and consistent pattern that moves the business forward. The top management includes positions such as Chairman, Vice-President, Board of Directors and the Chief Executive Officer.Chairman: A chairman is the highest rank holder in a company. They try to avoid processes that can’t be converted to other uses. They reject long-winded, poorly prepared plans and “bagged” profit targets instead of complaining but accepting them anyway. Every year their talent pool gets deeper and better because they’re constantly building critical mass on the theory that you never have enough good people. Seleta Reynolds, General Manager. A keen sense of the organization’s capabilities separates top GMs from less able executives. If it’s not producing an adequate return, it’s on our hit list. Actually, it was the other way round, just as it is for most companies. Yet if you analyze the way the process works in most companies, you find excessive support for marginal businesses, low payout projects, and operating necessities. A tough task, but he was convinced the goal was essential because he expected their chief competitor to cut prices to regain market share. The disadvantage lies in its rigidity and the length of time needed for information to flow through the organi… Consequently, Heinz shifted its focus from “beating Campbell” to making money in soup; it cut costs and concentrated on the low-price niche that didn’t interest Campbell. And that knowledge gives them the conviction they need to make things happen and gain a competitive edge. That’s what one new GM did when he took over Frito-Lay in the late 1970s. Engage in key or targeted customer activities. They know the numbers and what’s required to meet them. James Robison, the former GM of Indian Head, expressed this perspective in a colorful way. High standards come from more than demanding goals, of course. Middle managers, like most managers, accomplish their goals largely by managing relationships. This highly decentralized organization is skilled at marketing and product innovation and supported by a corporate credo that glues everything together into a very humane yet competitive company. They charge each business unit with managing its balance sheet and carefully measure its return. It clearly identifies authority, responsibility and accountability at each level.These relationships in the hiera… When they have a strategy or business problem or a big opportunity, they turn to the individual who has the right skills and style for that job. As the textbooks say, they “get things done through others.” Managing relationships at that level in the organization, however, is a threefold task, requiring middle managers to act as subordinate, equal, and superior: upward, they relate to their bosses as subordinat… The result: while former key competitors like Allied, ADG, and Federated were stumbling, May emerged as the largest, best run publicly held company in its chosen field. Moreover, top GMs carefully protect the downside on major investments. GMs generally work during business hours, but depending on the employer and the demands of the job, they may work some long days, late nights, and weekends. In return, it got fewer rejects, better products, more market share, and higher earnings per share. To that end, they make sure the process produces better results each year and that it gets pushed farther down in the organization. Ensure the overall delivery and quality of the unit's offerings to customers. They also understand how critically important job rotation is and break down functional empires that get in the way. Yet talking about the concept and making it live are two different things. In short, he was planning a major reorganization for generic problems that didn’t apply to his company. It also reduces complacency, encourages personal growth, and yields better results. They thought the plan was demanding and competitive. In short, this overview defines how the company is going to be different—and better—from a collection of totally independent businesses. Projectized Organization. Sounds humorous until you reflect on one of the cardinal weaknesses of most professional managers: they spend company cash as though it belonged to someone else. They must typically: Oversee daily operations of the business unit or organization. A general manager, sometimes simply called a GM, has broad, overall responsibility for a business or a business unit within a larger organization. One general manager, for instance, asks key managers to rank subordinates yearly on a scale from one to nine. The best GMs also know that compensation is a means to an end, not an end in itself. With so much emphasis today on financial restructuring, strategy formulation, and technology, it’s not surprising that many executives get ahead by spearheading successful projects in their particular functional areas. They have all the challenges of running a business, plus the challenges of reporting to a corporate group that is most likely focused predominantly on financial outcomes. Organizational Structure Organizational Structure. All rights reserved. They also refuse to let weakness in one or two areas (like control, R&D, or engineering) neutralize their strong departments. He has a keen sense of the kind of organization he wants Cummins to be. Organizational Structure: General Manager at EA Nick Earl , Arcadia Kim and Erin Turner , Electronic Arts Nick Earl, General Manager of Electronic Arts Redwood Shores Studio, talks about how the General Manager… F. John Reh wrote about business management for The Balance, and has 30 years of experience as a business manager. A chairman acts as a representative of the company to the outside world.Vice-President: The responsibilities of a vice-president vary as per the siz… Great general managers do the same thing. The moral of this story: before you reorganize, be sure of what you’re trying to do better and why. Learn About the Types of Jobs Available in Restaurants, Salaries, Required Training, and Projected Growth for HR Managers, CIO Job Description: Salary, Skills, & More, President Job Description: Salary, Skills, and More, Compensation Manager Job Description: Salary, Skills, & More, Vice President Job Description: Salary, Skills, & More, Chief Operating Officer Job Description: Salary, Skills, & More, Project Manager Job Description: Salary, Skills, & More, CEO Job Description: Salary, Skills, & More, Understanding the Role and Responsibilities of a Senior Manager, Manager Job Description: Salary, Skills, & More, Veterinary Practice Manager Job Description: Salary, Skills, & More. In Projectized Organization, the entire company is organized by projects. Copyright © 2020 Harvard Business School Publishing. As a result, line managers respect and use the staff instead of writing unfriendly memos or playing unproductive political games. Individually, none of these things is totally new or unique. Finally, top GMs are always searching for unproductive assets to get them up to par or off the books. They add overhead grudgingly. The sales management organizational chart displays the sales structure in a small company. Moreover, building on strength keeps competitors so busy responding to your initiatives that they have less time to launch their own. General management is more common in smaller, more versatile, environments where the general manager can actively engage in every facet of the business Functional Management Besides the … Without a general manager in place, Wood … Johnson & Johnson is an excellent example. The sixth and last area of responsibility for a GM is supervising operations and implementation. Instead of following the crowd, he focused his company on becoming the merchandising and operating leader in the department store business in each of its markets. The best GMs concentrate more resources on situations that provide the opportunity to gain an important competitive edge, or at least improve on one they already enjoy. It helps you define the scope of the job, set priorities, and see important interrelationships among these areas of activity. They’re also willing to take the heat by cutting bonuses in a poor year instead of pretending the bad year never happened and rewarding everyone for “trying hard.”. Naturally, that same pattern won’t apply to every company. The responsibility of every fragment is as the following: Create Your Own Org … To reduce hurt feelings, they make sure—in advance—that subordinates understand how the system works and why intrusion is sometimes required. Oversee daily operations of the business unit or organization. In a projected organization, the project manager … They develop a distinctive work environment; spearhead innovative strategic thinking; manage company resources productively; direct the people development and deployment process; build a dynamic organization; and oversee day-to-day operations. A GM is accountable to his or her boss or corporate group for all the activities of the business unit with an emphasis on financial results. Next, they push for functional excellence all across the business. In contrast, the best GMs routinely bring managers together to talk about the business, to get multiple inputs on important projects, and to line up their support. Matrix. Then its managers discovered they were playing Campbell’s game, not their own, since Campbell would routinely copy their new product and use its superior brand acceptance and distribution muscle to overwhelm them at the point of sale. An organizational structure is a system that outlines how certain activities are directed in order to achieve the goals of an organization. Responsible for leading global HR organization, including Talent Management, Leadership Development and Learning, Compensation and Benefits, Employee Relations and Security. Great coaches stress fundamentals—the basic skills and plays that make a team a consistent winner. Lack of management talent ranks right behind low standards as a cause of poor performance. A general restaurant organizational chart looks like this: The business belongs to the owners, and … To do this, they follow up on big capital expenditures to be sure the projected benefits are realized. Even one-time owners often invest in marginal projects they’d never have dreamed of financing when the business belonged to them. The best GMs establish goals that force the organization to stretch to achieve them. Want to Understand the Basic Job Description and Duties of a Manager? They’re also tough-minded about who gets what because they realize outstanding returns don’t come from parceling out money to subordinates who promise the best numbers (despite low odds) or to key managers to keep them happy. If we can’t figure out how to improve the situation promptly, we start to look for ways to get rid of it.”. But by focusing on fewer bets and backing them aggressively, they improve the odds. In larger organizations, individuals viewed as having general management potential often work in a series of assignments, rotating through the various functions and gradually growing their expertise and responsibilities over many years. During the next few years, the company dramatically changed its cost structure through a series of innovative cost reductions in production, distribution, purchasing, corporate overhead, and product-mix management. 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