In the structure of any enterprise must have a leader. How it is called, most often depends on the wishes of the founders and the charter of the enterprise. In the structure of the enterprise, the position of the chief manager can be called "director", "general director", "manager" or even "president". What is the difference? What is the difference between a CEO and a director, and what functional responsibilities does each of them have? Understanding these issues on your own can be difficult. So let's try to do this together.
What is the difference?
So, what is the difference between a CEO and a director? Do not look for a fundamental difference in the title of these posts from a legal point of view. The practical use of concepts is important here.
First of all, the formation of the name of each position is affected by the scope of the organization: business or non-profit activity. Most often it happens like this:
- the main figure in the structure of a commercial organization is the general director;
- a leading position in a nonprofit organization is simply a director;
- a functional manager in a commercial company is a director (for economics, human resources, public relations, financial and so on);
- the same functions in a nonprofit organization are assigned to the deputy director.
And what is the difference between a general director and a director in a structure, for example, an LLC? Everything is built on a slightly different principle. In each limited liability company, as a rule, a council is created. Each member is called a director, and the board as a whole, respectively, is the board of directors. Among them, one chief is elected or appointed - the general director of the LLC. It is he who exercises the main strategic leadership, based on the opinion and wishes of the Board of Directors.
CEO: job features
To understand how the CEO differs from the director, let’s try to make out what exactly this position represents.
As we have already found out, the phrase itself is used to designate the main position in managing a commercial organization. The general is not necessarily the same as the founding director. He may even be a hired employee and completely not participate in the share capital of the organization. Sometimes the name "CEO" is replaced by other terms. This is usually the president. But this definition is most often used to name the head of a group of companies, while the general director is the sole leader of a separate organization.
Who is the job description?
In accordance with the legislative framework, the Director General is elected in accordance with the decision of the meeting of the Board of Founders. Based on the minutes of the meeting, an order is being prepared to appoint a specific person to this position. In addition, the Board of Founders is developing a special job description and an employment contract. It is worth noting that these documents are not prepared for a specific person, but for the position itself, regardless of who occupies it. All working conditions and powers of the general director are registered there. Only after drawing up these documents is the Order of Appointment issued, which is signed by the head himself.After this, the signature is also put in the contract and job description.
If we are talking about an LLC created by a team of founders, then the instruction is approved by one of the directors authorized by a general decision of the Board. If the founder of the enterprise is alone, then all decisions are made and approved by him independently. The basis is the decision to create an LLC, even if he himself will be the general director.
Clearance requirements
The operating principles of each individual CEO may vary depending on the specifics of the enterprise. That is why the job description is being developed. This document reflects all fundamental principles of work.
The job description usually contains the following sections:
- key points;
- list of duties of the general director;
- the rights;
- CEO responsibility.
In accordance with this document, all work is carried out. Amendments to these instructions are possible only by decision of the Board of shareholders (founders) of the enterprise.
"General" duties
Regardless of the specifics of the enterprise, several main points can be distinguished that are prescribed in the job description:
- The duties of the Director General include the general management of the organization and its employees within the powers specified in the local acts of the LLC. Such acts may be: charter, regulation, collective agreement, labor contract and others. Naturally, in this case, compliance with the norms of the current legislation of the Russian Federation is mandatory.
- Adjustment of the effective work of the company in accordance with the developed production program, as well as involving all available resources.
- Maintaining an effective personnel policy that will attract experienced professionals to the enterprise. The main role in the selection of employees, whose knowledge will contribute to higher profits and competitiveness, also rests with the manager.
- The duties of the CEO include the development and implementation of new long-term plans and ideas that contribute to increasing the competitiveness of the enterprise, increasing its status and increasing profits.
- Skillful use of the organization’s assets to achieve the task.
- Control in all areas of activity, compliance with legislation.
- Development of internal acts of the organization with strict compliance with the laws of the Russian Federation.
- Representation of the interests of the company in cooperation with legal entities, individuals, as well as self-government and executive authorities.
The Director General also bears material and legal liability in the framework of administrative or criminal proceedings, compensation for losses in case of violation of the law, as well as damage to the status or property of the company in case of improper performance of their duties.
Who is the director?
As we have already found out, in some cases the term “director” may be identical to that discussed above. However, in Russian practice it is most often used:
- to indicate the position of the person responsible for the development of one of the functional areas of business (commercial, financial, Development Director, Director for frames);
- to indicate the main managerial position in non-profit organizations (school director, park director, museum director).
In the latter case, the phrase “deputy director” is used to indicate the head of the functional area. Although, of course, there are enough deputies in commercial structures.
Duties
The duties of the director usually include:
- organization and effective work of all structural divisions;
- increase the profitability of the company;
- approval of staffing;
- establishment of bonuses and allowances to employees;
- ensuring the fulfillment of obligations to suppliers, creditors and customers;
- delegation of control of certain areas of activity to heads of departments and branches;
- control of the structure of the enterprise;
- ensuring compliance with the regime of saving financial and labor resources.
The duties of the director also include:
- drawing up a master plan for the production of the enterprise and its development;
- elaboration of the organization’s budget for the year, quarter;
- exercising control over spending and income, using materials;
- control of compliance with financial discipline;
- compliance with the timeliness of reporting to the relevant authorities.
What is the difference between a general instruction and just a director?
If the structure of the enterprise assumes the presence of both a general director and direction directors, their job descriptions differ dramatically. The differences are primarily in the delegation of authority and level of responsibility.
- The general director represents the interests of the enterprise as a whole, and the director only within the framework of his unit and powers.
- The director in this case is appointed not by the decision of the Board of Shareholders, but simply by the order of the general director.
- In the presence of a general, there may be several director posts.
- The general director controls and adjusts the activities of the entire organization as a whole, and the director - only a separate area, for example, the financial part or sales.
Features of the director’s activities in various areas of management
Despite the fact that every managerial position provides for approximately the same powers, there are some peculiarities in different spheres of economic activity. Therefore, in order to occupy the post of director or general director in a particular area of business, you need to have some specific skills.
- In medical organizations, for example, special education is indispensable.
- The general director in the field of trade or the provision of services should thoroughly know the legislation on consumer protection.
- The general director of the security company should be able to directly interact with the bodies of the Ministry of Internal Affairs.
- In the field of housing and communal services, the leader should not only conduct a personal reception of citizens, but also closely cooperate with suppliers of raw materials to ensure the quality of the population with heat, water, electricity and so on.
In general, everywhere has its own specifics, and the position of director or general director is not only a beautiful word and a lot of authority, but also a huge responsibility. Moreover, the "louder" the word, the more responsibility.
