Originally Posted by SCX358G
Doesn't the managing director run the shop? And the chairman set strategy, interact with the industry, regulators, governmental departments and so on? So they are largely separate roles? I guess the real question is, at what company size, do you need to two different people to do these roles? In the local shop you certainly don't need both. Having only worked for a one man company and one with 400000 employees, I'm not sure where the dividing line would be - but I'd guess at maybe 50 employees?

Yep. Not sure whether it's strictly a size thing, or when you start to need to keep shareholders supportive of the BoD. Sometimes the correct development strategy doesn't always realise the required share price growth in the timescales expected, and it's then that the Chair becomes invaluable, letting the MD focus on doing what needs to be done.

We often used to discuss if you could identify the transition point when a small, thrusting, successful company with a shared vision and unity of purpose first encounters the dangers of becoming inefficient and losing direction. One interpretation is when the MD and the Chair start to have differing ideas on what the strategy should be. Another was as soon as you needed to have middle layers of management and an HR department.

But a company where both the Chair and MD are united in their purpose and strategy can be a formidable beast indeed. Let's wish MMC every success in maintaining this.


Tim H.
1986 4/4 VVTi Sport, 2002 LR Defender, 2022 Mini Cooper SE