What Is a Managing Director

The original meaning of the term managing director is one who manages. The oxford dictionary defines managing as having “having executive control or authority”. Director is a person who is in charge of an activity, department, or an organization. The word is primarily used in terms of a company or any organization with the person who has the responsibility to oversee and control functioning of the organization. In some place the term CEO (Chief Executive Officer) is used in place of managing director. He is responsible for formulating strategy, setting the goals and guiding the heads of various departments towards achieving the goal.Any business is run primarily for profit and as such needs funds to be run. So, primarily the managing director needs to be well aware of all the tools available for financial reporting and knowledge of the organization. This is needed to ensure that the business plan that has been formulated can actually be executed with maximum results and ensuring least expenditure. His role and responsibility can keep on changing as per the needs and size of the organization.

Most of the of professional positions have a very clearly defined role in terms of roles and responsibilities and reporting structure along with interactions with various heads but in for managing director this is mostly a grey area as most of the role is not very well defined, it can be everything that the organization does, and then almost nothing, depending on how you look at it.

The primary role of the managing director would be leading the organization. Something like the president of the country who runs the country but does not go to all the place to do every work. The majority and critical decisions on which the success or failure of the organization lay are taken by the managing director and hence he needs to be strong in the head and logic, capable of motivating people.The part of Managing Director will be the greatest leadership part. A Managing Director also needs to carry a pleasant personality as he happens to be the ambassador of the company. He also happens to be the bridge between the share holders of the company and rest of the organizations and entities that the organization deals with. In doing the proper execution of his responsibilities he has the liberty and freedom to chose to take inputs from any level of employees to ensure greatest success of the organization.

Managing directors, though employee of the organization, are still different from regular employees but still they have additional duties that are stipulated by the articles of the corporation. The managing director has to report to the owner of the majority stake holders of the organization for the functioning of the organization.