While I typically focus my articles toward high-ranking profit and loss leaders such as CEOs and line managers, I’d like to take the opportunity to discuss Level 1 leaders for staff departments, including: accounting, human resources, IT support, corporate communications, and legal. Oftentimes, top executives struggle with determining these individuals’ roles and evaluating their contribution, as Level 1 staff members are often seen as costly necessities to the rank and file employees, and have little impact on the company. They can be seen as bureaucrats or policy gatekeepers living off the revenue execution talent of others, and are often known to make business difficult.
Level 1 staff executives are paid sizable salaries and often benefit from large bonuses immune from enterprise performance. They can be seen to have little direct effect on profit, and are not held accountable except by subjective opinion relative to “likeability,” or their relationship with the CEO. Because they lack direct ownership for numerical KPIs, mediocre functional staff chiefs can skate for years without much quantitative accountability. Many are perceived to contribute only as process advisors when a crisis occurs for the line officers and client servers.
In numerous companies, employees have a right in evaluating the functional staff leadership as ‘maintenance personnel,’ in that they do not have the long-term competitive impact to justify their costs. This leadership can have considerable authority, but little quantitative accountability. If their only role is proven to be only functional transactions, the positions would be cheaper being outsourced or even automated.
Despite this, Level 1 functional staff can be the most valuable business leaders in the organization, if they are talented and their position is clearly defined and regulated.
I believe the most successful chief functional leaders […]