Monday, April 1, 2019

What are the three levels of management?

The three levels of management are the best structure of business organisation.

Every management has many managerial positions in its structure. These positions are created through the process of delegation of authority from top to lower levels. Each position is marked by authority, responsibility, functions, roles and relationships.

Broadly speaking, an organisation has two important levels of management, namely, functional and operative.

Functional level is concerned with the process of


  • Determining primary objectives
  • Formulating basic policies
  • Making vital decisions
  • Controlling and coordinating activities of personnel

Operative level of management is related to

  • Implementation of plans and decisions
  • The pursuit of basic policies for achieving of the organisation
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(i) Top level management 

Generally, ownership group occupied the top level management. In a joint stock company, equity shareholders are the real owners of the company.

The main functionaries in this level are included managing director, general manager or chief executive, to help directors.
The top level managers are the responsible for overall management of the organisation.

Functions of Top Level Management


  • To decide corporate goals
  • To make a corporate plan for the entire organisation covering all areas of operations
  • To design structure of organisation, creating various positions therein
  • To formulate basic policies and providing direction and leadership to the organisation as a whole
  • To coordinate various sub-systems of the organisation
  • To select key officials and executives for the company
  • To decide about the profitability and growth of the organisation such as introduction of new product, shifting to new technology and opening new plant etc.
  • To exercise overall managerial control through the process of reviewing overall financial and operating results
  • To make decisions regarding disposal and distribution of profits
  • To maintain cooperation with outside parties having a stake in business such as government. Trade union and trade associations etc.


(ii)  Middle level management

Middle level management is responsible to the top management for the efficient functioning of their departments.
In small enterprise, there is only one layer of middle management, but in big enterprises, there may be senior middle level managers and junior middle level managers.

The senior level managers include –

  • Heads of production
  • Finance
  • Marketing and 
  • Other departments

The Junior middle level managers include –

  • Branch managers 
  • Superintendents
  • Heads of various sections


Functions of middle level management


  • With the directions of top management they execute the plans of the organisation
  • They make plans for the sub-units of the organisation
  • They participate in the employment and training of lower-level managers
  • They evaluate the performance of junior managers
  • They attempt to achieve coordination between different departments
  • They send the progress reports and other important data to the top management.


(iii)  Lower level or supervisory level management 

This level consists of first line

  • Supervisors
  • Inspectors
  • Section officers, etc.

They are in direct touch with core group of workers such as operators, assemblers, mechanics, salesmen, and clerks etc. they directly supervise the work performed by core group workers.

They issue orders and instructions to them, educate them about methods of doing the work and regularly supervise their activities.

Functions of lower level management


  • To guide, assist and help the workers by explaining work procedures to them and by solving their problems
  • To motivate them and to maintain a team spirit among them
  • To put their case to higher level managers for various welfare schemes, incentives and for improving physical working conditions
  • to get the things done by core group workers
  • to prepare plan for their activities
  • to issue necessary orders and instructions to the workers regarding the work being performed by them
  • to assign the work to the workers and seek its workers regarding the work being performed by them
  • to arrange, material, machines and tools for the workers and provide training to them

Thus, these are the three level of management in the business organisation. 



Happy reading :)




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