ORGANIZATION CHART OF A COMPANY: WHAT IT IS FOR, TYPES, EXAMPLES - DUDAS

The organization chart of a company is a diagram that graphically reflects the organizational structure of a company, specifying the responsibilities, roles and relationships between the people who work within the corporation.

They broadly represent a company in its entirety or go deep into a specific unit or department. It is made up of boxes containing positions or names, connected with lines to indicate their relationships. It can be very simple or very broad, depending on the magnitude of what you want to represent.

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It is also known as a hierarchy diagram, as it can show the reporting lines within a company. Some organizations go a step further by adding photos of their members or images to represent different departments.

Sometimes the organization chart reproduces the clear organization of a company. Other times it reproduces the rigidity of top-down hierarchical systems.

Business tool

Companies are always looking for ways to show their structure, combining the classic components that make organization charts useful with new ideas that better communicate the style or culture of the organization.

Many times, companies dispense with their organization charts and later make them resurface when they need a consultation on their structure and organization.

The organization chart of a company connects people based on a hierarchy. For this reason, it has remained incredibly tough over the years. This tool cannot be replaced, because it solves an important need for a company.

What is the organization chart for?

It is extremely useful when a company considers changing its management team or restructuring its staff. In addition, it allows employees to see transparently how their roles fit into the overall structure of the company.

Incorporation of new hires

When a company hires a new employee, it can be difficult to integrate quickly because they do not know who is who in the different departments. This can cause confusion and make mistakes when talking to the right person.

The organization chart of the company shows new employees how they fit into the organization the moment they join. Using it, they can quickly learn who is who, who does what, who works where and who they need to know.

Engaging remote employees

More companies are allowing employees to work remotely. These salaried employees may rarely enter the corporate office, making it difficult for them to feel part of the team. It can be challenging for companies to help them connect with their coworkers.

The org chart is one of the ways companies can assemble a virtual team. Since each employee has detailed information on co-workers, you can quickly find who you need and connect with them.

Increase productivity

Employees spend hours every day searching for people and information. This has a significant impact on productivity and efficiency.

The organization chart is used so that anyone can locate whoever is required, even if it is not very clear who they are looking for.

Finding career growth opportunities

The organization chart is used to discover certain skills that may not be found in your own department staff. Thus, the talent pool expands, giving employees the flexibility to use their talents and skills in all departments and throughout the company.

Companies must establish pathways for career growth and thus offer employees something to aspire to.

Organizational chart types

- Hierarchical

This is the most common organizational chart model. Put the highest ranking people at the top and the lowest ranking people below them.

This brings great clarity to companies that operate with a hierarchy and need a clear chain of command in order to act quickly.

Employees are grouped in such a way that each has a clear supervisor. This grouping is carried out based on some factors:

Function

The grouping of employees is given according to the function they provide. For example, human, technical, financial and administrative resource groups.

Geography

The grouping of employees is given according to the geographical area where they work in the country. If it is a globalized company, the grouping could be done by country.

Product

If a company produces several products or offers different services, employees can be grouped according to the product or service.

- Flat

To avoid the impression of a top-down hierarchical organization chart, some companies literally change the chart to horizontal.

By turning a hierarchical org chart around, it transforms it into a flat org chart. In this case, the head of the organization is not at the top, but is at the extreme left, with all the staff flowing from there.

The flat organization chart places people on the same level, indicating the capacity for independent decision-making and more equal power.

The most important thing about this structure is that many levels of middle management are eliminated.

- Matrix

It is an evolution of the hierarchical organization chart to be able to include a visual form of the report to several superiors.

This organizational structure looks somewhat like a table. Groups people by their common skill set, the departments they work in, and the people they can report to.

Employees are often connected to more than one manager, such as a systems analyst working on two projects, one with their regular manager and one with a separate product manager.

In this context, the matrix diagram would connect the systems analyst with vertical lines to each manager with whom he is working.

This provides the flexibility to be able to represent this type of organizational arrangement.

How do you make an organization chart?

- Design the structure

Observe how decisions are made

Most of the companies are generally organized horizontally or vertically.

In a horizontal structure, employees are empowered to make decisions. In a vertical structure you must climb the hierarchy structure to make a decision.

Organize by departments or by employees

One way to build the organization chart is by department. For this it is not important whether the company departments are divided by functions, products or locations.

You can take the main departments and then subdivide them into sections within those departments.

Another way to build an organization chart is by employees. The names of the employees are used and the diagram is organized according to the links they have between them.

Collect the necessary information

If you are building an organization chart that is based on employees, you will need the names of the employees, their titles, and the relationships between them.

For a department-based organization chart, the names of all the departments and the relationship between them are collected.

- Work on the design

Make a sketch

A picture of the organization is created, starting first with the major parts of the structure, such as the main departments.

You could also start with top managers, if you are using an employee-based diagram.

The purpose is to establish how the organization chart should be viewed and the amount of information to be included.

Decide how much detail you want

In a large corporation it is probably not feasible to include all employees. It may not even be feasible to include all departments. Therefore, the amount of detail to include must be decided.

Select a layout

One type of organizational chart design is to make it like a family tree. You have the President in the upper segment of the diagram and below him there are lines to the managers or main departments, also enclosed in boxes. This layout works well in a hierarchical company.

On the other hand, in a less hierarchical company a bubble-like design might work better. If you have four similar departments without a Director, these departments can be connected, leaving each department from a box or central bubble with the name of the company.

- Use of software

Microsoft Office turns out to be a good starter software for creating the org chart, because it is easy to use and to obtain. With Excel, Word and PowerPoint you can create a diagram.

Programs and templates that allow you to create an organization chart can also be found on the Internet.

Add the necessary boxes

After having chosen the diagram, the information that has been outlined begins to be added to the organization chart. All the boxes and connecting lines that will be needed are added.

The added lines will not only show connections from top to bottom, but will also be able to connect different departments.

Complete the information

Add the information within each box. It is easier to start at the top, especially if you have a largely hierarchical company. Then you advance through each department.

When using a bubble style, you start in the middle and work your way out.

Organizational chart examples

Coca Cola

It is probably the most recognized food product on the entire planet. The number of countries in which the flagship product of this company is consumed is practically total. Coca-Cola does not know of cultural or ideological barriers.

Part of its success is based on the way it is organized. Its organization chart is worth studying to put into practice successful organizational schemes in the world.

Bimbo

It has a very broad organization chart, made up of 196 floors. The Bimbo group is a corporation based in Mexico, which has managed to achieve its position as the world leader in the baking industry.

They make cookies, fresh and frozen bread, tortillas or cakes, among others. It has more than seventy years in the world market.

See more in: Bimbo organization chart.

Mapfre

Multinational insurance company made up of more than 34,000 employees and more than 85,000 brokers, with a net return of more than 528 million euros in 2018.

The 30 million customers who trust this company get great attention in more than 5,000 Mapfre offices around the world.

Themes of interest

Organization chart of a hotel.

Organization chart of a service company.

Organization chart of an industrial company.

Organization chart of a construction company.

Organization chart of a commercial company.

Organization chart of a clothing company.