Often overlooked, the organizational chart is one of the most important tools in the organization and the proper functioning of a company.
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What is a business organization chart?
An organizational chart is a tool that provides a representation of the organizational and functional structure of a business.
The company organization chart visually presents the managers and employees of the company, the functions and departments as well as the hierarchical relationships. This medium is made up of shapes (rectangles, circles, etc.) or boxes indicating the name and position of the company’s employees. These elements may be accompanied by photos, icons, contact details or links. The boxes are connected by lines representing the hierarchical links. The whole then gives a graph which illustrates the internal structure of the company.
The creation of an organizational chart is not a legal obligation for a company. Each structure is therefore free to decide whether or not to set up this tool. However, the company organization chart is very useful, because known to be a support for internal communication, it is also a tool for the management of a company and its personnel.
The business organization chart thus has many advantages since it makes it possible to meet several objectives.
- Visualize the place of each employee in the company, his role and his hierarchical position.
- Provide a better understanding of the functioning, organization and hierarchical links of the company, especially for new employees.
- Detect any malfunctions and correct them.
- Give employees a precise idea of who they should contact depending on their issues.
- Help managers define the number of employees in each department.
- Facilitate communication between teams and ensure better coordination.
- Managing growth or changes within the business.
- Optimize administrative tasks.
- Outline promotion opportunities.
A business organization chart can be used in the following cases:
- to restructure work teams;
- to recruit new employees;
- to distribute work tasks;
- to plan the workforce;
- to plan resources.
What are the types of business organization chart?
The business organization chart is a tool that comes in three different models:
- the hierarchical organization chart;
- the matrix organizational chart;
- the flat organization chart.
The hierarchical organization chart
The hierarchical organization chart is the most commonly used model since it takes into account the position and the hierarchy of each collaborator. This organizational chart has the characteristic of taking the form of a pyramid. The company director sits at the top, and department heads are listed just below. Employees with the least responsibility are at the bottom of the pyramid. The horizontal lines designate the same hierarchical level, while the vertical lines represent the relationship of each employee with his superior. The hierarchical organization chart is organized into different departments: sales, human resources, finance, marketing, IT, technical, administrative, etc.
Example of a hierarchical organization chart:
The matrix organization chart
The matrix organizational chart is used by companies organized by projects. In this case, the collaborators, or work teams, depend on several managers. Each employee can have a functional manager, but also one or more project managers to whom greater authority is granted. In addition, it should be noted that a company adopting a matrix structure is a company organized into branches, regions or functions. This type of structure is based on the principle of duality at the level of control and management. The structure of the company is therefore at the operational level on the one hand and at the functional level on the other. The matrix organization chart is then divided between the function and the project. This model is a good way to establish more open communication between different teams.
Example of a matrix organizational chart:
The flat organizational chart
The flat organizational chart, also called horizontal organizational chart, mainly applies to small companies, and in particular those with few hierarchical levels. In this model, only two levels are illustrated: management and employees. In the case of a flat structure, employees exercise more responsibilities. In addition, this type of structure promotes decision-making capacity, but also interactions between management and employees. In larger companies, the flat org chart can also be used to highlight a specific company department. Only the manager and employees of the service will then be identified.
Example of a flat organization chart:
How to make a business organization chart?
To create a business organization chart, here are the steps to follow:
- identify the business structure;
- define the purpose and scope of the organizational chart;
- determining the information constituting the flowchart;
- gather information on employees;
- select the flowchart template;
- create the business organization chart from software;
- use shapes and colors;
- show wizards with a sidebar;
- organize regular updates.
Identify the structure of the company
The first step in designing a business organization chart is to define the internal structure of the business as a whole. It is a question of identifying the members of the personnel of the company and their role, but also the various departments and their person in charge.
Define the purpose and scope of the flowchart
The definition of the structure of the company will then make it possible to determine a framework for the organizational chart. This framework will define the overall objective of the corporate organization chart as well as its scope. Also, you have to ask yourself the right questions.
- Does the chart relate to the whole company, a specific department, a work group or a project?
- Is this material going to be used as a resource to help each employee know who occupies which position?
- Will the organizational chart be shared with external stakeholders or partners?
- Should I create one or more organizational charts?
Determine the information constituting the organization chart
One of the key steps in preparing a business flowchart is defining how the support is going to be structured. The idea is to organize a distribution of the different categories of staff: teams, departments, projects, etc.
It is also relevant to determine the information to appear in the business organization chart. In general, the boxes of the organization chart include the first and last names of the employees as well as their function and their department. But it is possible to add a photo and even contact information such as a phone number or an email address.
Gather employee information
It is essential to have the right information to establish an effective organization chart. The next step is therefore to collect all relevant information and data relating to managers and employees: job title, contact details, photos, etc. Who is in charge of the operational strategy, who is in charge of the management of this or that department… To gather this information and not make any omissions, it is interesting to use an existing list of personnel which can serve as a point of reference. departure for the realization of the organization chart.
Select Org Chart Template
Each company must also determine the organization chart it needs. The model of the organization chart must correspond to the structure of the company. As seen previously, the person in charge of creating the organization chart can choose between hierarchical, matrix or flat.
Create business flowchart from software
There are several free tools that make building a business flowchart simple and effective.
- Office software: Word, Excel or PowerPoint.
- Online tools like GitMind or Canva.
Use shapes and colors
The use of shapes and colors is important for making a flowchart. These details make it possible to distinguish functions and services, and therefore make the support more consistent and understandable. The ideal is to choose a different shape and color for each hierarchical level.
Show wizards with a sidebar
Some leaders may have assistants. They should also appear in the organization chart by means of a sidebar under their manager. Thanks to this style of formatting, employees know who they should contact if they want to contact the manager of the company.
Organize regular updates
Once the organizational chart has been created, it is necessary to take into account the changes that companies may face: departures, recruitment of new employees, transfers, etc. Such changes can quickly make the organizational chart obsolete. This is why this support should be regularly updated. The organization chart must also mention the date of update of the latest version.
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