What the leadership team does
The board of directors approves strategy, annual budgets, major investments and senior appointments, and oversees risk and compliance through its committees. The managing director or CEO turns that into an annual plan, builds the leadership team and runs the monthly review of performance against budget. CXOs such as the CFO, COO, CHRO, CTO and CMO run their functions and sit on the management committee, where decisions that cross functions are made. Vice presidents and general managers lead large businesses, regions or plants and carry profit and loss or cost responsibility. Leaders also own the company's culture: how decisions are made, how people are treated and which behaviours are rewarded.
The top team at 50, 500 and 5,000 employees
In a 50-person company, leadership is the founder or promoter family, perhaps with one or two trusted managers for operations and accounts. Decisions are quick and informal, and the founder approves almost everything, from hiring to purchases above small amounts. By 500 employees, the company needs functional heads who can decide without the founder: a head of sales, a head of operations or plant head, a finance head and an HR head. The founder becomes managing director, meetings become a weekly management review, and approval limits are written down.
At 5,000 employees, the company has a full CXO layer, business unit heads with profit responsibility, vice presidents and general managers running regions and plants, and independent directors on the board. Family businesses at this size often separate ownership from management by appointing a professional CEO while promoters stay as chairman or on the board. Succession planning, leadership development and a clear delegation of authority become regular board topics.
How leaders work across departments
Most problems that reach leadership sit between departments: sales promising what operations cannot deliver, finance holding payments that purchase has committed, HR policies that plant managers find impractical. The management committee exists to settle these trade-offs, using shared numbers so debates are about decisions rather than data. Each CXO also represents their department's constraints, which is why a CHRO or CFO who reports straight to the CEO can raise issues early. Good leaders spend time at plants, branches and customer sites, because reports alone hide problems. Clear decision rights stop every issue from travelling up to the managing director.
Decision rights and reporting lines at the top
The managing director or CEO reports to the board, and CXOs report to the CEO; in some companies a COO or president sits between the CEO and the business heads. Vice presidents report to CXOs or business heads, and general managers report to vice presidents. Senior leaders usually carry annual goals written as KRAs or OKRs, reviewed quarterly by the CEO, with the CEO's own goals reviewed by the board. A written delegation of authority fixes who decides what, and a typical split looks like this:
- Annual budget, large capital spending and senior appointments: the board or the MD
- Pricing policy, new markets and organization changes: the CEO with the management committee
- Hiring within approved headcount and spending within budget: the CXO or business head
- Day-to-day operating decisions within policy: general managers and department heads
Typical leadership and senior management team structure
Leadership and Senior Management designation hierarchy
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Book a free demoSee pricingFrequently asked questions
What is the difference between a managing director and a CEO?
In Indian companies the managing director is a member of the board who also runs the company, while CEO is an executive title for the person who leads the business day to day. Often one person holds both, written as MD and CEO. Where they are different people, the MD usually represents the promoters and the CEO runs operations.
What comes after general manager in the corporate hierarchy?
In many Indian companies the ladder above general manager runs to senior general manager, then assistant or deputy vice president, vice president, senior vice president, and executive vice president or president, followed by CXO roles and the managing director or CEO. Titles vary by company, so compare scope, team size and budget rather than the title alone.
Who are the CXOs in a company?
CXOs are the chief officers who lead major functions and report to the CEO: typically the chief financial officer, chief operating officer, chief human resources officer, chief technology or information officer, and chief marketing officer. Some companies add a chief business officer, chief risk officer or chief compliance officer, depending on the industry and size.
When should a founder hire a professional leadership team?
A founder should start hiring professional functional heads when decisions queue up for their approval, when growth adds new locations or product lines, and when finance, HR and operations need depth the founder cannot provide. Many companies start with a finance head and an HR head, then a COO or business heads, and write down approval limits as each role is filled.