Management Compensation Tool FAQ

This position represents the senior individual in the firm who has been elevated to chairman of the board. Day-to-day responsibility for managing the firm is passed to the chief executive officer (CEO). The chairman of the board still works within the firm and draws a regular salary. Typically, the position focuses on one area of the firm, such as marketing or strategic growth, rather than overall firm management. Please note, firms were asked to provide data only for the chairman role. However, a few participants might have included salary data for multiple board members when submitting data for this position.

The CEO is responsible for day-to-day operations and business strategies carried out by the firm. Comparable titles include that of president or managing partner. While the practice of several equal partners sharing CEO-type responsibilities is not very common in the profession, a few firms reported more than one CEO or no CEO and several partners.

The chief operating officer (COO) or executive vice president (EVP) assists the CEO with overall firm responsibilities. Unlike administration or operations directors, this executive typically has authority over all business functions of a firm rather than over only a limited, defined area. The COO/EVP usually shares responsibilities with the CEO; each has day-to-day responsibility for separate, designated business areas. This executive will usually assume CEO operational responsibilities in the absence of the CEO.

Typically, the senior vice president (SVP) or senior principal is responsible for a segment of a firm’s practice, such as a design discipline, business unit, geographic region, or project type. The SVP/senior principal usually reports directly to the CEO or the COO. Firms with more than 50 total staff will often have more than one senior vice president or senior principal. The SVP/senior principal has more authority than most firms’ principals and might supervise various principals who report to the specific senior vice president.

Other principals/partners usually have some ownership interest in the firm and their focus is primarily on project delivery. These individuals spend significant time working with clients and charging to projects. Other than top management or business development management, these principals spend more time in marketing and sales than other managers. Many firms have principals/partners with no added functional titles. This indicates that design firms continue to focus certain senior individuals (i.e., principals) on project delivery rather than dividing responsibility for project delivery among their other functional managers.

The chief financial officer (CFO) or director of finance has full responsibility for the firm’s financial operations. The ability to commit the firm’s resources or to bind the firm to financial commitments is what differentiates this title from other financial positions. This title is generally given to individuals who have substantial authority to manage all of the firm’s business assets. CFO is the highest-ranking management position with no project or technical design responsibilities. Alternative titles include vice president of finance.

The controller has primary responsibility for maintaining the firm’s financial records. In larger firms, where accounting is done at the business unit, office, or divisional level, there may be a controller for each accounting group. This position differs from CFO/director of finance in that the controller usually does not have full authority over the firm’s financial assets and is not responsible for setting the firm’s financial strategies. The difference between a controller and a business manager is that controllers typically deal only with financial matters, whereas business managers control both financial and other business/administrative activities.

The chief administrative officer (CAO) or business manager is responsible for managing the overall administrative aspects of a firm, including accounting, human resources, and general office management. This position is not involved with marketing or professional services. Typically, business manager is the first non-technical (other than clerical) person hired by a small design firm. As firms grow, they tend to hire individual human resources and office managers. In addition, they might change the title for the individuals with financial responsibility to either controller or director of finance.

The director of BIM/CAD services has management responsibility for determining how and when to apply different BIM/CAD workflows and modeling for projects, firm-wide. This person establishes the firm’s strategy and approach to BIM/CAD.

The director of operations has the responsibility and authority to deliver completed projects to the firm’s clients. Normally, those directly in charge of projects (project managers, department heads, or branch office managers) report to this individual. Typical responsibilities include allocation of the production staff, resolving scheduling conflicts, and efficient utilization of the design staff. Often, the individual’s management responsibility is limited to local, regional, or client-service type organizations (e.g., office, environmental business, and Northeast region). Historically, it is most common in mid-sized to larger firms.

The director of business development is the individual with primary responsibility for setting the business development AND marketing direction in the firm. Typically, this individual develops/leads the sales effort for the firm and oversees/develops marketing strategies when there is no separation between business development and marketing.

The director of marketing is the individual with primary responsibility for setting and implementing the marketing strategy of the firm, including creating marketing collateral, putting together proposals, resumes, etc. This person is NOT typically directly responsible for the business development efforts of the firm.

The director of human resources is responsible for a firm’s personnel management functions, including hiring, employee benefits, compensation programs, and record keeping. Alternative titles include director of personnel and personnel manager. Human resources management positions typically carry a large degree of authority, including responsibility for fringe benefit development and the firm’s human resources policies. The authority to implement these types of policies constitutes a management-level position.

The director of IT/computer operations is responsible for a firm’s IT assets, including hardware, software, and networks. Alternative titles include data processing manager, manager of automated services, computer manager, manager of information systems, and chief information officer.

The branch office manager has on-site responsibility for day-to-day operations of a firm’s office separate from the main office. Some firms use this title for a group manager with a particular project specialty — airports, for example. Alternative titles include profit center manager and division manager. Typical responsibilities include marketing, sales, human resources management, and project execution at a local branch office of the firm. The local management responsibilities are often carried out in support of, and under the overall direction of, the central office. The title of branch office manager is comparable in many respects to the director of operations, typically on a smaller scale.

The department head has management responsibility for a specific functional discipline (e.g., electrical, civil, environmental) within an office. The title also may describe the manager of a group responsible for a separate phase of project work (e.g., programming, detailed design). Alternative titles include group leader and group manager. Typical responsibilities include staff management, production scheduling, and technical quality for the design discipline. The title of department head has become less common in smaller firms, possibly because some smaller firms might shift department head responsibilities to operations managers and/or project managers.

The senior project manager has full responsibility and authority to execute a project, both within the firm and in its relationship with the client. In addition to completing project tasks, this individual typically participates in marketing and selling the project, setting fees, and negotiating contracts (including additional services). Making commitments for the firm and responsibility for contracting and billing matters separate this position from the project manager position.

The project manager is responsible for managing and completing projects in the firm. This position differs from the senior project manager largely due to less responsibility for business development and contract negotiations. This individual has limited involvement in marketing or selling a project, establishing fees, or making significant commitments to the client. Alternative titles include job captain and team leader. This position is typically the entry-level position for technical professionals to assume non-technical management responsibilities in design firms. Please note, this position was titled junior project manager in previous editions of this report.