Business Management Levels and Functions

Managers are members of an organization who are charged with the responsibility of supervising other members. Typically, there are 3 primary levels of management: top, middle and lower.

These levels of authority form a hierarchy. Each level is discussed in this article, along with the chief responsibilities. Most business management careers span all levels of the hierarchy, although there are some exceptions (e.g. entrepreneur, general manager, and small business owner).

Top Level Management

Top managers are the highest level managers in the business management hierarchy. Their job is complex and demands complete commitment and dedication to the organization. They are carry a high amount of responsibility for the success or failure of the organization.

Top managers include Board of Directors, Chairman, Managing Director, President, Vice President, General Manager, and Chief Executive Officer.

Top-level managers perform the following main functions:

  1. Develop the long-term objectives. Top managers develop the long-term objectives such as manpower planning, distribution of capital, and expansion of the business.
  2. Framing of policies and plans. They formulate and lay down the guidelines for the departmental heads; such as policies relating to production, personnel, marketing, public relation and finance.
  3. Making key appointments. Top authority appoint the key personnel (such as the departmental heads) so as to develop a structure that ensures profitable growth of the organization.
  4. Organizing. Top-level authorities organize the enterprise into various department and sections to achieve the set objectives. They also organize the activities to be carried out by executives in middle management. For example, they may look to integrate human resources and digital marketing staff and functions.
  5. Controlling. They periodically review the work of the executives at various levels to ensure that their performance is at par with the set plans of the organization.

Middle Managers

Middle managers act as the link between the top authority and supervisory management. They implement and control strategies and plans formulated by top-level managers. They have a tactical role.

Middle managers receive instructions and orders from top-level authority and pass them to lower managers for implementation. This level comprises of heads of the various department such as production manager, finance manager, sales manager, and marketing manager.

The main functions include:

  1. Interpreting the policies formulated by the top authority to supervisory level. Middle managers act as the linking pin between the top level managers and the lower level supervisors. They only explain the main policies and plans framed by top management to supervisory level.
  2. They organize the activities of their department to ensure execution of policies and plans, such as online training. Being the heads of departments, middle-level managers organize all the activities and resources of their respective department.
  3. Appointing and recruiting employees for their departments. They look and select employees to work under their departments.
  4. Assigning duties. They assign responsibilities and duties to supervisory and operative personnel to ensure execution of their respective departmental plans.
  5. Communication. They communicate decision and orders downwards and also carries complaints and suggestions upwards.
  6. Coordination. They cooperate and coordinate with other departments to ensure smooth functioning of the business.

Supervisory Management

Lower-level managers are also considered as supervisory or operational managers. They are the first-line managers who oversee the implementation of policies and plans by the workforce in an organization. They consist of forepersons, inspectors, supervisors, etc.

Lower level managers perform the following functions:

  1. Represent the grievances or complaints of workers before the middle managers. The operational level managers directly link with subordinates and therefore, are able to understand their grievances better. They pass these grievances to the middle authority.
  2. Develop healthy relations between the middle managers and subordinates. The lower level managers create supportive working environment and conditions to improve the relations between subordinates and top supervisors.
  3. Assist the middle-level managers in selecting, recruiting, and appointing workers to the department. The supervisory managers help and guide the middle managers when they recruit and appoint employees.
  4. They motivate the workforce; being responsible for developing team spirit and boosting the morale of the workers.
  5. Looking after the safety of workers. Supervisory managers provide secure and safe working environment for workers.
  6. Discipline. Operational managers maintain discipline among the workers by taking corrective actions when necessary.
  7. Training. They arrange for the training of workers in the workplace.


Having a clear business management hierarchy in place enables enterprises and organization to succeed and remain competitive. It enables everyone in the organization to understand their duties, helping to create a smooth workflow. You can expect significant changes in tasks and responsibilities as you move up the hierarchy across the breadth of management functions.