Keen competition is expected because the prestige and high
pay attract a large number of qualified applicants.
Top executives are among the highest paid workers; however,
long hours, considerable travel, and intense pressure to succeed
The formal education and experience of top executives vary
as widely as the nature of their responsibilities.
Nature of the Work
All organizations have specific goals and objectives that they
strive to meet. Top executives devise strategies and formulate
policies to ensure that these objectives are met. Although they
have a wide range of titles—such as chief executive officer, chief
operating officer, board chair, president, vice president, school
superintendent, county administrator, or tax commissioner—all
formulate policies and direct the operations of businesses and
corporations, public sector organizations, nonprofit institutions,
and other organizations.
A corporation’s goals and policies are established by the chief
executive officer in collaboration with other top executives,
who are overseen by a board of directors. In a large corporation,
the chief executive officer meets frequently with subordinate
executives to ensure that operations are conducted in accordance
with these policies. The chief executive officer of a corporation
retains overall accountability; however, a chief operating
officer may be delegated several responsibilities, including
the authority to oversee executives who direct the activities
of various departments and implement the organization’s policies
on a day-to-day basis. In publicly held and nonprofit corporations,
the board of directors ultimately is accountable for the success
or failure of the enterprise, and the chief executive officer
reports to the board.
The nature of other high-level executives’ responsibilities depends
on the size of the organization. In large organizations, the duties
of such executives are highly specialized. Some managers, for
instance, are responsible for the overall performance of one aspect
of the organization, such as manufacturing, marketing, sales,
purchasing, finance, personnel, training, administrative services,
computer and information systems, property management, transportation,
or legal services. (Some of these and other management occupations
are discussed elsewhere in this section of the Handbook.)
In smaller organizations, such as independent retail stores or
small manufacturers, a partner, owner, or general manager often
is responsible for purchasing, hiring, training, quality control,
and day-to-day supervisory duties.
Chief financial officers direct the organization’s financial
goals, objectives, and budgets. They oversee the investment of
funds and manage associated risks, supervise cash management activities,
execute capital-raising strategies to support a firm’s expansion,
and deal with mergers and acquisitions.
Chief information officers are responsible for the overall
technological direction of their organizations. They are increasingly
involved in the strategic business plan of a firm as part of the
executive team. To perform effectively, they also need knowledge
of administrative procedures, such as budgeting, hiring, and supervision.
These managers propose budgets for projects and programs and make
decisions on staff training and equipment purchases. They hire
and assign computer specialists, information technology workers,
and support personnel to carry out specific parts of the projects.
They supervise the work of these employees, review their output,
and establish administrative procedures and policies. Chief information
officers also provide organizations with the vision to master
information technology as a competitive tool.
Chief executives have overall responsibility for the operation
of their organizations. Working with executive staff, they set
goals and arrange programs to attain these goals. Executives also
appoint department heads, who manage the employees who carry out
programs. Chief executives also oversee budgets and ensure that
resources are used properly and that programs are carried out
Chief executive officers carry out a number of other important
functions, such as meeting with staff and board members to determine
the level of support for proposed programs. In addition, they
often nominate citizens to boards and commissions, encourage business
investment, and promote economic development in their communities.
To do all of these varied tasks effectively, chief executives
rely on a staff of highly skilled personnel. Executives who control
small companies, however, often do this work by themselves.
General and operations managers plan, direct, or coordinate
the operations of companies or public and private sector organizations.
Their duties include formulating policies, managing daily operations,
and planning the use of materials and human resources, but are
too diverse and general in nature to be classified in any one
area of management or administration, such as personnel, purchasing,
or administrative services. In some organizations, the duties
of general and operations managers may overlap the duties of chief
In addition to being responsible for the operational success
of a company, top executives also are increasingly being held
accountable for the accuracy of their financial reporting, particularly
among publicly traded companies. For example, recently enacted
legislation contains provisions for corporate governance, internal
control, and financial reporting.
Top executives typically have spacious offices and numerous support
staff. General managers in large firms or nonprofit organizations
usually have comfortable offices close to those of the top executives
to whom they report. Long hours, including evenings and weekends,
are standard for most top executives and general managers, although
their schedules may be flexible.
Substantial travel between international, national, regional,
and local offices to monitor operations and meet with customers,
staff, and other executives often is required of managers and
executives. Many managers and executives also attend meetings
and conferences sponsored by various associations. The conferences
provide an opportunity to meet with prospective donors, customers,
contractors, or government officials and allow managers and executives
to keep abreast of technological and managerial innovations.
In large organizations, job transfers between local offices or
subsidiaries are common for persons on the executive career track.
Top executives are under intense pressure to succeed; depending
on the organization, this may mean earning higher profits, providing
better service, or attaining fundraising and charitable goals.
Executives in charge of poorly performing organizations or departments
usually find their jobs in jeopardy.
Training, Other Qualifications, and Advancement
The formal education and experience of top executives vary as
widely as the nature of their responsibilities. Many top executives
have a bachelor’s or higher degree in business administration
or liberal arts. College presidents typically have a doctorate
in the field in which they originally taught, and school superintendents
often have a master’s degree in education administration. (For
information on lower-level managers in educational services, see
the Handbook statement on education administrators.)
A brokerage office manager needs a strong background in securities
and finance, and department store executives generally have extensive
experience in retail trade.
Some top executives in the public sector have a background in
public administration or liberal arts. Others might have a background
related to their jobs. For example, a health commissioner might
have a graduate degree in health services administration or business
administration. (For information on lower-level managers in health
Many top executive positions are filled from within the organization
by promoting experienced, lower-level managers when an opening
occurs. In industries such as retail trade or transportation,
for instance, it is possible for individuals without a college
degree to work their way up within the company and become managers.
However, many companies prefer that their top executives have
specialized backgrounds and, therefore, hire individuals who have
been managers in other organizations.
Top executives must have highly developed personal skills. An
analytical mind able to quickly assess large amounts of information
and data is very important, as is the ability to consider and
evaluate the relationships between numerous factors. Top executives
also must be able to communicate clearly and persuasively. Other
qualities critical for managerial success include leadership,
self-confidence, motivation, decisiveness, flexibility, sound
business judgment, and determination.
Advancement may be accelerated by participation in company training
programs that impart a broader knowledge of company policy and
operations. Managers also can help their careers by becoming familiar
with the latest developments in management techniques at national
or local training programs sponsored by various industry and trade
associations. Managers who have experience in a particular field,
such as accounting or engineering, may attend executive development
programs to facilitate their promotion to an even higher level.
Participation in conferences and seminars can expand knowledge
of national and international issues influencing the organization
and can help the participants develop a network of useful contacts.
General managers may advance to a top executive position, such
as executive vice president, in their own firm or they may take
a corresponding position in another firm. They may even advance
to peak corporate positions such as chief operating officer or
chief executive officer. Chief executive officers often become
members of the board of directors of one or more firms, typically
as a director of their own firm and often as chair of its board
of directors. Some top executives establish their own firms or
become independent consultants.
Top executives held about 2.3 million jobs in 2004. Employment
by detailed occupation was distributed as follows:
General and operations managers
Top executives are found in every industry, but service-providing
industries, including government, employ 8 out of 10.
Keen competition is expected for top executive positions because
the prestige and high pay attract a large number of qualified
applicants. Because this is a large occupation, numerous openings
will occur each year as executives transfer to other positions,
start their own businesses, or retire. However, many executives
who leave their jobs transfer to other executive positions, a
pattern that tends to limit the number of job openings for new
Experienced managers whose accomplishments reflect strong leadership
qualities and the ability to improve the efficiency or competitive
position of an organization will have the best opportunities.
In an increasingly global economy, experience in international
economics, marketing, information systems, and knowledge of several
languages also may be beneficial.
Employment of top executives—including chief executives and general
and operations managers—is expected to grow about as fast as average
for all occupations through 2014. Because top managers are essential
to the success of any organization, their jobs are unlikely to
be automated or to be eliminated through corporate restructuring—trends
that are expected to adversely affect employment of lower-level
managers. Projected employment growth of top executives over the
2004-14 period varies by industry. For example, employment growth
is expected to be much faster than average in professional, scientific,
and technical services and in administrative and support services.
However, employment is projected to decline in some manufacturing
What do top executives earn?
Top executives are among the highest paid workers in the U.S.
economy. However, salary levels vary substantially depending on
the level of managerial responsibility; length of service; and
type, size, and location of the firm. For example, a top manager
in a very large corporation can earn significantly more than a
counterpart in a small firm.
Median annual earnings of general and operations managers in
May 2004 were $77,420. The middle 50 percent earned between $52,420
and $118,310. Because the specific responsibilities of general
and operations managers vary significantly within industries,
earnings also tend to vary considerably. Median annual earnings
in the industries employing the largest numbers of general and
operations managers in May 2004 were:
Computer systems design and related services
Management of companies and enterprises
Building equipment contractors
Depository credit intermediation
Median annual earnings of chief executives in May 2004 were $140,350;
although chief executives in some industries earned considerably
Salaries vary substantially by type and level of responsibilities
and by industry. According to a 2005 survey by Abbott, Langer,
and Associates, the median income of chief executive officers
in the nonprofit sector was $88,006 in 2005, but some of the highest
paid made more than $700,000.
In addition to salaries, total compensation often includes stock
options, dividends, and other performance bonuses. The use of
executive dining rooms and company aircraft and cars, expense
allowances, and company-paid insurance premiums and physical examinations
also are among benefits commonly enjoyed by top executives in
private industry. A number of chief executive officers also are
provided with company-paid club memberships and other amenities.
Top executives plan, organize, direct, control, and coordinate
the operations of an organization and its major departments or
programs. The members of the board of directors and lower-level
managers also are involved in these activities. Many other management
occupations have similar responsibilities; however, they are concentrated
in specific industries or are responsible for a specific department
within an organization. A few examples are administrative services
managers; education administrators; financial managers; food service
managers; and advertising, marketing, promotions, public relations,
and sales managers. Legislators oversee their staffs and help
set public policies in Federal, State, and local governments.
See the Career Database for
more information on these careers.
Sources of Additional Information
For a variety of information on top executives, including educational
programs, certification programs, and job listings, contact:
American Management Association, 1601 Broadway, 6th Floor,
New York, NY 10019. Internet: http://www.amanet.org/
International Public Management Association for Human Resources,
1617 Duke St., Alexandria, VA 22314. Internet: http://www.ipma-hr.org/