Manager: what it is, what it does, how much it earns and when it is needed

To achieve success, every company (startups included) cannot do without proper and efficient business management.

If you feel today that you have all the time and skills your startup needs, know that this may change in the future. As a business grows, in fact, it may be necessary to introduce a manager into the company, who can reduce your workload and responsibilities and bring in valuable skills to manage business processes.

Before you take action on hiring a manager, however, you should be clear about what duties and responsibilities such a professional handles on a daily basis and, most importantly, you should know when is the right time to include a professional with this specific role in the organizational chart.

In the next few lines we will explain who is and what a business manager does.

Who is the manager: definition and role

The manager is a key figure within a company because he or she is the one who coordinates the activities of the professionals who make up the various internal teams in the organization and is responsible for business operations and management.

You should know, however, that within a company, there are different types of managers, each of whom has specific duties and responsibilities. In a “traditional” type of organization, for example, you can identify 3 distinct managerial figures:

• Top Managers;
• Middle Manager;
• First Line Manager.

Types of managers

The Top Manager is the chief executive officer (CEO) of the company, i.e., the person at the top of the organizational chart who oversees the company’s entire production process.

The Middle Manager, also known as Project Manager, is the figure responsible for a specific project and who coordinates the First Line Managers, who are not directly involved in the project but who coordinate the work of other internal non-managerial resources, managing their tasks and responsibilities and measuring their results.

Even within the organizational chart of startups there is a manager: the startup manager is, in fact, the one who is responsible for the general operations and operational management of the company. Even in the case of startups, different types of managers can be identified in relation to specific tasks. The four most common types, in this sense, are:

• the business development manager, who is responsible for seeking and developing new business opportunities for the startup;
• the product manager, who is responsible for developing and managing the products and/or services made by the startup;
• the head of marketing (marketing manager), who creates and executes the marketing strategy;
• the operations manager, understood as the day-to-day operations of the startup.

Now that we have defined who a manager is (or, more accurately, who managers are), it is also important that you know the difference between manager and leader (spoiler: startups need both).

The former are concerned that the goals set by the company are met, the structure is maintained and business processes are adhered to, while the latter focus on vision and, often, explore new and original ideas outside parameters such as, precisely, the company’s internal structure and processes. Managers, then, have people who refer to them while leaders have people who are inspired by them. Pay attention, however, to this aspect: as Ralph Nader teaches,

“the function of leadership is to produce more leaders, not more followers.”

What a manager does: daily responsibilities

In explaining what manager means, we have inevitably also made mention of what such a figure does. Because of the delicacy of the role, however, it is appropriate to dwell further on what a manager does. Ultimately, his or her daily activities can be divided into three macro-areas:

• Personnel management;
• The organization of work;
• The meetings and business meetings.

Personnel management

Research conducted by London School of Economics and Harvard Business School, titled “Executive Time Use Project,” has shed light on how CEOs organize their work and the influence this has on their companies’ performance.

This study found that one of the main goals of managers is to coordinate other professionals and develop their potential.

Indeed, the manager evaluates workers’ performance, increases their motivation through moral support and incentives, organizes training and/or refresher courses, and provides workers with everything they need to work efficiently. Not only that: managing staff, for a manager, also means taking responsibility for identifying new resources useful for the company’s growth.

Work organization

Proper personnel management cannot be separated from careful organization of work: indeed, a manager’s duties include planning activities by identifying for each function the best resources to carry it out. The manager, as already pointed out, must also monitor performance, of the individual and of the various work groups, in order to make sure that predetermined company goals are achieved on time and on budget.

Meetings and business meetings

The aforementioned “Executive Time Use Project” research by the London School of Economics and Harvard Business School also clarified another aspect related to the way CEOs organize their work in the company: about one-third of a manager’s weekly working hours are spent in meetings, but to this share we must then add phone meetings and business lunches.

How much does a manager earn: economic aspects

Before you take action to hire a manager you should consider another aspect: do you know how much a manager makes? Obviously, the answer depends on several factors, but in the next few lines you can get an idea of the basic salary of this professional figure and the benefits and incentives to be provided.

Basic pay

The figure of the startup manager is widespread in the United States of America, where his or her annual base salary averages $85 thousand (just over 77 thousand euros). At any rate, the salary of this professional figure generally ranges from $40 thousand (36 thousand euros) to $100 thousand (almost 91 thousand euros).

Clearly, this figure can vary depending on a number of factors, starting with the skills and experience of the manager and ending with the size of the startup. Just as obviously, in thinking about the figures just stated you have to consider the differences between the United States of America and Italy.

Benefits and incentives

When hiring a manager, it may happen that his desire to establish himself may lead him not to take responsibility for the results achieved by the team he leads. This risk can be averted by providing, in addition to the base salary, benefits and incentives linked to his and/or his team’s performance.

When to hire a manager: right time and selection criteria

As noted at the beginning of this in-depth discussion, business growth may make you feel the need to hire a manager. But when is the right time to hire this figure? To find the answer to this question, you need to analyze your startup’s needs.

Identify the needs of the business

A few questions can help you determine whether it is time to hire a startup manager: are you spending most of your time in your startup? Has the day-to-day management of the business become too complex? Is there a need to take the startup to the next level?

In all of the above cases, hiring a manager could be the solution: this figure can help you in the day-to-day management of the business and develop new development strategies, making sure that everything runs smoothly in the company’s growth process and reducing your workload so that you have time to focus on other areas.

Selection criteria for a manager

Planning early to bring in a startup manager allows you to arrive at the time of selection with a clear idea of the areas of business where there is the greatest need for expert help and the specific skills this figure must have.

There are different qualities that make a startup manager a good startup manager and, consequently, there are also different criteria that you have to evaluate in the selection process.

The person chosen must know how to seize new business opportunities in a timely manner and not be afraid to take risks, but he or she must also know how to successfully carry out what was budgeted, turning his or her (and your) ideas into reality.

Not only that, a good startup manager is also able to build a winning team, creating efficient communication channels and keeping the mood within the company high.

Last but not least: the startup manager you choose must also be able to raise the necessary funds for the growth and development of your startup, relating as best he can to investors. Tied to this discussion there is, inevitably, another aspect to consider in the process of selecting a startup manager: we refer to the impact that his or her salary will have on corporate accounting.

Conclusion: the manager in the business context

Before we conclude our discussion of what a startup manager does and when (and why) you should hire him or her, it is good for you to know that maintaining a good relationship with such a figure (who, in fact, will find himself or herself operationally managing your “creature”) will not be super easy.

Trust cannot be lacking in such a relationship, nor can compromise. You should communicate openly and frequently, with honesty and clarity about expectations and results. Regularly ask for feedback on the day-to-day operations of the company, and remember that the startup manager is an expert in his or her field, so you should never (ever!) ignore his or her guidance and suggestions.