Being a global company, the British Airways has several branches across the globe. A general manager, sometimes simply called a GM, has broad, overall responsibility for a business or a business unit within a larger organization. Updated Jan 05, 2021; Posted Jan 05, 2021 . But focusing effort in these six areas will help any GM become more effective. In small … The success of an organization will depend upon the caliber of the manager in utilizing the … Moreover, because every business environment changes over time, the best general managers constantly ask: What kind of business do we want to run? The prerequisites to becoming a general manager vary depending on the requirements of the business and may include a minimum level of education, experience, and certification. Above all, they are impossible to satisfy. If the general manager sets high standards, key managers will usually follow suit. Marginal performers don’t stay long in pivotal jobs. Yet many GMs are perfectly willing to bet the company before they know if a new strategy will work. When Ned Johnson took over Fidelity Management & Research, for example, he decided there were two things wrong with the mutual fund industry: competition was based on who had performed best lately, so fund managers lived or died on the basis of each quarter’s or year’s performance; and customers were constantly shifting funds because of poor performance or poor service. Sure, they’ll take such sweeping actions if they’re in a situation where that’s necessary or desirable. And that’s as true in small- and medium-sized companies as it is in giants like General Motors and General Electric. Ensure the creation and implementation of a strategy designed to grow the business. And that knowledge gives them the conviction they need to make things happen and gain a competitive edge. And they put constant pressure on the organization to improve productivity. Communicate strategy and results to the unit's employees. In short, he was planning a major reorganization for generic problems that didn’t apply to his company. Do we still have viable positions in each? In a projected organization, the project manager … The role of a general manager isn't an easy one. 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. 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. The second element of the work environment that GMs consistently influence is the basic business concepts the company adopts. The Lions are shaking up their organizational structure, could hire coach before GM. 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 organizational structure determines how the organization performs or operates. This doesn’t mean they are risk-averse—far from it. They don’t hire only in their own image but rather tolerate, even encourage, a variety of styles. These branches are led by branch managers, who are in turn answerable to the general manager. Finally, the best GMs expect their competition to retaliate to any strategic move that works, and they plan for the worst-case response. Great general managers do the same thing. Vice presidents stand below the C-suite executives. 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. That means running the business day-to-day by producing sound plans, spotting problems and opportunities early, and responding aggressively to them. Great objectives if they’re realistic. The best GMs also do lots of little things—like farming out pilot runs and renting plants and machinery—that limit their front-end exposure. In larger organizations, the general manager reports to a corporate executive, often the chief executive officer or chief operations officer. Despite its overall success, J&J now faces a new set of competitive conditions that are forcing managers to rethink long-standing business concepts. They learn to push their ideas through a small, narrowly based group of subordinates and peers but not how to manage a diverse team of executives from several areas. People who are interested in becoming general managers may also consider other careers with these median salaries: Source: U.S. Bureau of Labor Statistics, 2018. The best GMs willingly make the tough calls it takes to upgrade an organization. At the same time, they don’t wreck the business to “make plan” in a serious downturn. A general restaurant organizational chart looks like this: The business belongs to the owners, and … 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. Such a simple organizational chart helps improve department management … And they don’t settle for vague answers, wishful thinking, or lack of follow-up when new departments or programs are proposed. If we can’t figure out how to improve the situation promptly, we start to look for ways to get rid of it.”. A general manager usually must speak the languages of finance and accounting, operations, sales, marketing, human resources, research and development, and engineering. There are few things that managers can do alone; they must usually rely on the support, cooperation, or approval of a large number of people. Recognizing that lasting competitive edges are hard to generate, the best GMs build on existing strengths while searching out new sources of advantage. 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. Recently, for example, I saw a consultant’s report comparing the cost structure of a major U.S. electronics components producer with its Japanese competitor. But by focusing on fewer bets and backing them aggressively, they improve the odds. But when you have good people, make darned sure you listen to what they have to say.”. Figure: British Airways Organizational Structure British Airways has a unique organizational structure led by a general manager, who is answerable to the Board of Directors. Learn More. To avoid these problems, Johnson envisioned a supermarket of 50 to 60 funds that offer customers every conceivable investment focus plus superior service. They use challenging job assignments to speed high-potential managers’ development and eliminate blockages to open up spots. Instead of just looking inward, they get their competitive information first-hand by talking to knowledgeable customers and distributors. Provide direct management of key functional managers and executives in the business unit. They must typically: Oversee daily operations of the business unit or organization. To begin with, they have a strategic vision for each business, or they develop one quickly when they’re appointed to a new job. The term organizational structure refers to how the people in an organization … Oversee daily operations of the business unit or organization. In contrast to the GM who is satisfied to have one or two high-performing departments only, they demand superior execution in every function. Yet talking about the concept and making it live are two different things. Whether they’ve written it down or not, top-notch GMs have a broad overview of the fields they want to compete in and the way the company will succeed in those chosen fields—the balance between centralization and decentralization, the role of line and staff, the kinds of rewards that will motivate people to achieve their goals, the skills needed to become an industry leader. The matrix structure is a bit more confusing, but pulls advantages from a couple of different … By contrast, in the 1960s, Pepsi spent so much of its money and effort trying to prop up weaker markets, products, and channels that it lacked the resources to go all out in stronger areas. To sum up, outstanding GMs affect their companies in six important ways. The result of this process is a set of business concepts that shift in small ways in a consistent direction. The sales management organizational chart displays the sales structure in a small company. For example, they simply won’t permit overhead to rise from 12% of sales to 14% no matter what. 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. But they don’t use that prerogative as an excuse to dabble in everyone else’s territory. Finally, the best GMs use staff people well and expect them to make positive contributions, not to nitpick or “gotcha.” They appoint strong functional leaders (not line-manager rejects, politicians, or tired old pros) who can provide innovative, idea-driven leadership (not just ask good questions) and can transfer ideas across the organization. They know that sustained superior performance can’t be built on one-shot improvements like restructurings, massive cost reductions, or reorganizations. The best GMs establish goals that force the organization to stretch to achieve them. 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. Evaluate and decide upon key investments in equipment, infrastructure, and talent. As a result, line managers respect and use the staff instead of writing unfriendly memos or playing unproductive political games. Above all, they get line managers deeply involved in the upgrading process by forcing periodic, tough-minded appraisals of individuals and groups. He is a planner, coordinator, producer and a marketer. Moreover, top GMs carefully protect the downside on major investments. 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… Leadership skills and the GM’s personal style and experience are important pieces of the whole. 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. A functional organizational structure is a structure that consists of activities such as coordination, supervision and task allocation. As for a small company, the organizational structure chart must be concise and complete so that the whole company can move forward, with the least expense, normally and smoothly.. Ensure the creation and implementation of a strategy designed to grow the business. Today you cannot write about strategy without talking about giving customers better value than your competitors do. All general managers say they allocate resources to support competitive strategies, keep the company economically healthy, and produce high returns. Also called as the executive level, the top management guides the overall functions of a business. As is shown in the picture, you can find detailed information of any employee as a glance, including the 0name, photo, position, department, phone number, and email address. But it goes beyond that. 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 … 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. Worse, its managers were convinced it was easier to build a 5% market share to 10% than to grow 30% to 35%. Horizontal or flat org structure. What makes it important is its status as an organizing framework for the vast majority of activities general managers perform. 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. 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… Then he reminds everyone that the same performance it took to get a six this year will earn only a five next year. They charge each business unit with managing its balance sheet and carefully measure its return. 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. General Manager. Matrix Structure. In the 1970s, for example, Pepsi concentrated on its heartland markets, grocery chains, and new large packages—all Pepsi strengths. First, they improve sales and profits of their strongest products, in their strongest markets, with their strongest distributors. Harvard Business Publishing is an affiliate of Harvard Business School. Amazon organizational structure has the following three key features: 1. Moreover, with so many funds operating, Fidelity always has four or five winners to brag about. They know that sustained superior performance can’t be built on one-shot improvements like restructurings, massive cost reductions, or reorganizations. They do regional rollouts to test the market and control costs. High standards come from more than demanding goals, of course. Moreover, they set and reinforce high standards in small ways that quickly mount up. The responsibility of every fragment is as the following: Create Your Own Org … Clearly one of the most important standards a GM sets is the company’s goals. 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. 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. 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. Ensure the overall delivery and quality of the unit's offerings to customers. In his business, however, fast, local decisions aren’t particularly important—and his company was already regarded as a fast mover, not a laggard. To that end, they make sure the process produces better results each year and that it gets pushed farther down in the organization. That’s what distinguishes a useful vision from the bunch of meaningless generalities some GMs use to describe their business strategies. The best GMs also know that compensation is a means to an end, not an end in itself. A GM's salary can vary greatly depending on location, experience, and employer. And they learn almost nothing about the problems of implementing their ideas in other functional areas or integrating the efforts of a disparate, often geographically dispersed group of managers. Coordinate the development of … In time, however, character flaws or even shortcomings like inconsistency do catch up with people—causing serious problems for both the GM and the company. They constantly ask how their high-potential people are performing and how managers are solving their people problems. Actually, it was the other way round, just as it is for most companies. Below the vice presidents come … Great coaches stress fundamentals—the basic skills and plays that make a team a consistent winner. As a result, despite substantial price erosion, it racked up record profits and share-of-market gains. In a matrix organization, the functional manager shares responsibility for directing the work of individuals with the project manager. Individually, none of these things is totally new or unique. These six responsibilities don’t tell the whole story, of course. 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… 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. Finally, top GMs use information better than their colleagues do to spot problems early and to identify potential competitive edges. Top GMs are usually very results-oriented. Review ideal examples of management resumes to make sure you stand out among other candidates and include everything employers want to know. The best GMs seem to look for the simplest ways to do things, which usually means fewer layers, bigger jobs, and broader responsibilities. … To marshal resources for winning strategies, they’re willing to postpone or rethink high-risk investments or shortchange low-return businesses. For this reason, the best GMs lead annual personnel reviews instead of delegating that job to department heads or division presidents. Their operating plans are commitments, not just something they’re trying hard to achieve. I’ve seen many GMs who thought they were solving major problems with logical sounding reorganizations that left out the most essential ingredient—the appropriate leader. 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. Ensure the development of tactical programs to pursue targeted goals and objectives. Naturally, those reorganizations accomplished very little. Line organization is the simplest form of organization and is most common among small companies. 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. Trite as it may sound, somewhere along the line, the best GMs have learned the value and impact of teamwork. James Robison, the former GM of Indian Head, expressed this perspective in a colorful way. Rewards are linked to performance. This means making conscious decisions about what tangible measures constitute superior performance; where your company stands now; and whether you’re prepared to make the tough calls and take the steps required to get from here to there. Projectized Organization. At the time, the company was building new potato chip plants every year to gain market share in the low-return business. Moreover, building on strength keeps competitors so busy responding to your initiatives that they have less time to launch their own. Next, high-impact GMs regard competitiveness gaps—in products, features, service—as crises. They add overhead grudgingly. 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. 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.”. They also understand how critically important job rotation is and break down functional empires that get in the way. As soon as the sales or production or R&D department reaches one standard, they raise expectations a notch and go on from there. Structure of HR departments depend on the size of your organization… Academic organizational concepts won’t keep them from intruding on someone else’s territory if the stakes are crucial to the company’s success. High standards are thus the principal means by which top general managers exert their influence and leverage their talents across the entire business. A manager’s job is very crucial in an organization. In fact, very few companies do. Copyright © 2020 Harvard Business School Publishing. Guess who changed his views—five years too late—about where his company stood and what was required to regain market leadership? Naturally, that same pattern won’t apply to every company. A restaurant organizational chart will show employees in an organized chain of command. Middle managers, like most managers, accomplish their goals largely by managing relationships. 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? Engage with corporate officers in broader organizational strategic planning. 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 … In short, this overview defines how the company is going to be different—and better—from a collection of totally independent businesses. They reject long-winded, poorly prepared plans and “bagged” profit targets instead of complaining but accepting them anyway. 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. General Manager responsibilities include formulating overall strategy, managing people and establishing policies. Finally, they directly influence important appointments by exercising a veto or offering subordinates a slate of candidates to choose from. Then they use the resulting faster payoffs to help fund the search for future edges. A general manager (GM) is responsible for all or part of a department's operations or the company's operations, including generating revenue and controlling costs. They pay their best performers considerably more, even if that means paying the average performers less than they expect. Then managers feel more responsible for results simply because they are more responsible. July 2020 Rancho California Water District ADMINISTRATION Administration (29) Director of Administration Customer and Support Services Manager … This carefully crafted corporate overview gives J&J a significant competitive edge virtually everywhere it operates. Lawrence Bossidy, vice chairman of GE, put it well: “If your subordinates don’t have good ideas, get rid of them and get some who do. Unlike less resourceful GMs, they don’t miss their profit plan every year because of expected unexpected events. A keen sense of the organization’s capabilities separates top GMs from less able executives. It isn’t a question of more information; they simply use information better. The disadvantage lies in its rigidity and the length of time needed for information to flow through the organi… Seleta Reynolds. In contrast, outstanding GMs think like owners. A general manager's duties and responsibilities cover a lot of ground, but these are some of the most common. The degree to which a functional manager is involved in the project depends on the form of organizational structure. 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. “That means every business, plant, machine, and job is open to question. Oversee key hiring and talent development programs. Contact information for general inquiries and feedback. Seleta Reynolds is General Manager … The general manager in the hierarchy usually falls below the vice president of operations. As a result, they get more out of every strategy and every program than their competitors do. Sure, this approach creates extra stress, possibly even frustration. Then, when they’re sure the idea will work, they go to war for it. Lack of management talent ranks right behind low standards as a cause of poor performance. 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. 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. But they also know that surprises will occur, so they keep enough flexibility in their spending to allow for competitive threats, good new ideas, or softer volume. The company’s local execution was already superior to its main competitor’s by a wide margin. “Every Friday evening we start a whole new ball game,” he’d say. If it’s not producing an adequate return, it’s on our hit list. This list shouldn’t be surprising; the fundamentals of a general manager’s job should sound familiar after all. If business drops off sharply, they move faster than others to scale back costs, cut discretionary expenditures, and eliminate losers. As a result, each year they have better managers in critical spots instead of a group that’s merely one year longer in the tooth. 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? All rights reserved. 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. How should we be reshaping the business? They also get personally involved in solving important problems, regardless of what the organization chart says. For this reason, unless your company or division already has demanding standards—and very few do—the single biggest contribution you can make to immediate results and long-term success is to raise your performance expectations for every manager, not just for yourself. A horizontal or flat organizational structure fits companies with few … They do this through a network of roughly 100 tightly focused, freestanding operating companies. The new decentralized organization would cost roughly what the old one did—in the early stages, before it had a chance to grow. That’s what one new GM did when he took over Frito-Lay in the late 1970s. The moral of this story: before you reorganize, be sure of what you’re trying to do better and why. In several major parts of the business, customers have decided they want fewer suppliers and better integrated distribution and administrative services. 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