Understanding the Executive in a Government or Company!

Definition of executive – Readers must have heard of executive. The word executive itself is related to government and also positions. The executive is a government agency created by the state to carry out various state functions.

Executives can also be interpreted as people who hold the highest position or have the highest authority in a company.

In simple terms, the executive can also be referred to as government. In addition, the figure who is said to be an executive is a figure who is considered the most important in an organizational system. As an example in the state structure, the executive branch is the institution with the highest position.

Likewise in a company, the executive is the highest authority who will make decisions in a company.

So that Readers understands more about what an executive is, both in government and in the position structure, let’s see this article until it’s finished! The following will explain the meaning of the executive in government, the meaning of the executive in office, and its supporting elements.

Definition of Executive Agency in Government

The executive branch is one of the three state agencies in the Indonesian government system.

State institutions themselves are government institutions created by the state, originating from the state, and intended for the state. State institutions are government organizations that will carry out state functions.

The executive branch is an institution that is given the power to implement laws. The executive branch is a government agency that has the power and responsibility to enforce the law.

The executive branch is tasked with administering government affairs, implementing laws, and maintaining security and order.

At this time, the position of the executive branch is held by the president as the head of government. In the Law of State Institutions in a democratic country, the executive branch is briefly defined as the power held by the president or king along with his ministers. In a broader sense, those included in the executive branch as well, namely the military and civil servants.

Therefore, in simple terms, the executive branch can be called the government. In carrying out its duties, the executive branch side by side with the legislature and the judiciary. The duties of this executive branch apply both domestically and abroad.

Authority and Duties of the Executive Agency 

Based on the explanation of the meaning of the executive branch that has been written above, the task of this institution is to implement laws, regulations and policies, which have been made by the legislature. In addition to these duties, there are powers and duties of other executive institutions, namely:

  1. Organizing state administration.
  2. Drafting or dispensing laws, then guiding them to the People’s Representative Council until they become laws.
  3. Organize the police and other security forces, organize war, organize national defense and internal security.
  4. Appoint representatives of the State of Indonesia such as ambassadors or consuls for other cooperating countries. The Indonesian Ambassador will be stationed in the capital city of the country, and the consul is an agency under the Indonesian Embassy in another country.
  5. Make agreements with other countries with the approval of representatives of the people and carry out cooperation.
  6. Giving a title sign, service mark, or other mark of honor to Indonesian citizens or foreign countries who have services for the Indonesian state.
  7. Receiving and welcoming ambassadors from other countries who come to Indonesia.
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Executive Agency System

After getting to know the meaning, authority, and duties of the executive branch, we will then get to know how the system of the executive branch is. The executive body system is generally divided into two, namely:

1. Parliamentary Government System

In this system, the head of state and head of government are separate. The head of state is led by the president, while the head of government is led by the prime minister. However, the head of state only functions as a symbol of a sovereign state.

2. Presidential Government System

The head of government and the head of state are both held by the president in this one system.

Executive Board Structure

As an institution, of course there is an arrangement within the organization. The following is the composition of the executive branch in Indonesia.

1. President

The president is the highest government administrator who holds government power based on the Constitution. The executive body system or government system in Indonesia is a presidential system. The President of the Republic of Indonesia has a special position, namely as head of state and also head of government.

2. Vice President

In carrying out his duties and obligations, the president will be assisted by the vice president. Therefore, the president and vice president are in one institution, namely the presidential institution.

3. Ministry of State

State ministries are government tools that deal with certain areas of government.

4. Minister-level officials

Minister-level officials are officials whose position is under the president and are directly responsible to the president.

5. Non-Ministerial Government Institutions

Non-Ministry Government Institutions are central government institutions created specifically to carry out certain governmental tasks from the president.

Definition of Executive Agency in Corporate Structure

Executive is defined as a person who holds the most important position or has the highest authority in a company. An executive has the highest authority and power to manage the company’s operations. Executives have enormous influence on the companies they lead, so these executives will play a very important role in being able to manage their subordinates.

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The executive determines the direction of the company, so the executive must make the right decisions and policies within the company. Every human being has a different character. It’s the same as every executive who has a different character in leading his company.

Based on Low’s (2006) explanation, the executive leaders of a company have two characters in carrying out their duties, namely risk takers and risk averse. Risk taker is one of the executive characters who dare to take risks. Conversely, risk averse is an executive character who lacks the courage to take risks. The character of an executive who is a risk taker will dare to do anything in order to get the maximum profit.

Risk takers will be braver to take risks even though the risks taken can be said to be large. On the contrary, executives who have a risk averse character tend to dislike big risks. He will tend to avoid risks and definitely prefer smaller risks (Evianisa, 2014).

Every company must have a leader who occupies the highest position, which is usually referred to as top manager or top executive. These top executives must have certain characteristics to lead and manage the company’s business activities in an effort to achieve the goals to be achieved by the company. The character of an executive will greatly determine how the company works or the system.

This is because, everything that is done by the company must have a risk, whether it is small or big. According to Budiman and Setiyono (2012), the types of characters of individuals or executives who serve in company management, whether they are risk taking or risk averse, can be seen in the size of the company’s risk or existing corporate risk.

Executive Character Indicator

Company risk is one part of the executive character indicator. Company risk or corporate risk is the volatility of the company’s earnings, which can be measured by the standard deviation formula. So that company risk or corporate risk can also be interpreted as a deviation or standard deviation from earnings. Either the deviation is more than planned (upside potential) or less than planned (downside risk).

The greater the deviation of the company’s earnings indicates that the greater the company’s risk. According to Paligorova (2010), to determine the character of an executive, the company’s risk or corporate risk is also used. The size of the company’s risk will reflect the tendency of the executive character (Ni Nyoman Kristiana Dewi and I Ketut Jati, 2014).

So, that’s Readers’ understanding of the executive in the field of government and positions, along with the tasks, system, structure, characteristics, and determining indicators.