Corporate titles indicate an employee’s position in the hierarchy and define their responsibilities. A company’s titration system reflects its organizational structure and chain of command, with standard or original titles added at any level below top executives. In the US, companies typically use “Chief” titles or designate a president at the top, with many large corporations combining the two.
A corporate title is a designation that indicates where an employee fits in the corporate hierarchy. It defines the scope of the employee’s functions and responsibilities and indicates the chain of command. There is a generally recognized standard methodology for using business titles, but there are many variations within the common format. Corporations have the authority to use or create any securities system that reflects the corporation’s culture and organizational structure decisions.
How a company uses titles reflects its organizational structure and chain of command. Titles also indicate functional areas of responsibility for the employee and for the company. A business title has an industry expectation of included duties and responsibilities that guide job descriptions and hiring. An employee holding a title would have reason to object if his/her functional duties do not fall within his job description or within the scope of the standard definition of title. In this way, titles exist to protect employees while allowing a company to define its management and operational structure.
As a result, the type of titration system a company will use will be one of the first decisions it makes when starting up. A new company must first decide how to appoint senior managers, which is usually a reflection of common practices in the country where the company is based. In the United States, for example, companies typically choose one of two standard methodologies. “Chief” titles result in an executive triangle with the chief executive officer (CEO) at the top and a chief operating officer (COO) and chief financial officer (CFO) reporting directly to him. Alternatively, the company may designate a president at the top, with an executive vice president of operations and an executive vice president of finance reporting to him.
Many large corporations in the United States combine the two types of titles so that their executives have a title that is translatable and comparable regardless of the environment in which they operate. The chairman would also have the title of CEO, reflecting the fact that he runs the company and is also the chief executive officer of the board. CFOs and COOs also hold executive vice president titles so they fit into the company’s organizational structure with both corporate titles.
After designating the title system for senior executives, a company can compile its organization chart with standard or original titles that reflect the way the company operates. A corporate title can be added at any level below top executive. You can add other main titles, such as risk manager or marketing manager. Under the executive vice presidents can be a vice president of marketing or communications. Manager, director, and supervisor are other titles that can fill out management levels below executives.
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