An organizational chart is a graphical presentation of the organizational structure of organization. Organization chart in particular illustrates the dependencies between functional units in organization, which may be, for example, a single workstation or group of posts separated due to their functions. Put simply an organization chart shows the organizational structure model of company.
In connection with the two basic models of management, you can also highlight the two main models of organizational structures. Mechanistic model of management correspond to the hierarchical organizational structure, and organic management model has organic structure. In addition, we can highlight the third intermediate type of organizational structures with both characteristics of hierarchical and organic structure.
Organizational chart types
- linear structure - the simplest organizational structure most commonly used in small organizations, based on the principle of the unity of the management. Characterized by centralization of power and a clear chain of command. Teams of people are built around tasks, rather than the common functions. Functional ties coincide with business goals.
- functional structure - one of the types of organizational structure characterized by the existence of functional departments led by professionals and a broken principle of unity of the management. Members of the organization are subordinate to both functional managers and management officials. A major flaw of this structure is the difficulty in separation of powers of the individual functional managers, which can lead to conflicts,
- linear-staff structure - is a type of structure that combines the advantages of a linear and functional structures. Is based on staff ties as in a linear structure, while at the same time allows for dependency on functional managers for problem solving. In practice, this is the most common hierarchical structure.
- divisional structure - based on divided internal units of the organization with large autonomy, leading to a decentralization of power. This can lead to conflicts between units and hinder coordination. Nevertheless, this type of structure is widely used in large business organizations
- Matrix structure - a characteristic feature of this structure is the abandonment of the principle of the unity of management. Accepts the principle of a dual-manager subordination, which causes that the chart is similar to a mathematical matrix with columns and rows. Double subordination can cause confusion and conflicts.
- project structure - is a development of the existing structures with the ability to create specific teams and task forces operating just over a period of time in order to carry out certain projects. These teams may consist either of the employees of your organization, as well as specialists from outside,
- network structure - appeared in connection with the development of cooperation between organizations, joint ventures, strategic alliances, etc. The essence of the network is that independent companies interconnected using modern information technologies create each time a different configuration. Any such configuration is called a virtual company. Due to the changing configurations, it is difficult to create an organization chart of the network structure.
The above-mentioned are the most commonly used organizational charts are arranged vertically. Besides, there are also other layout options for organizational charts.
Examples of Organizational chart
- A hierarchical organizational chart is a diagram that shows the structure of an organization and the relationships and relative ranks of its positions and jobs. Hierarchical organizational charts generally have a pyramid structure, with the most senior person at the top and the ranks below them in descending order.
- A matrix organizational chart is a type of organizational chart that shows the multiple reporting structures within an organization. This type of chart is most commonly used when there are multiple departments or divisions with overlapping roles and responsibilities, or when there are multiple teams or groups within a larger organization.
- A flat organizational chart is a type of organizational chart that shows the structure of an organization without hierarchy or other formal divisions. This type of chart is most commonly used in companies that have a collaborative, team-oriented approach to work and in which each employee is responsible for multiple roles or tasks.
Advantages of Organizational chart
An organization chart is a useful tool for illustrating the structure of an organization, and the various roles and responsibilities of its employees. It provides clarity and insight into the roles, relationships, and responsibilities within the organization. The following are some of the advantages of an organization chart:
- It helps to create an effective structure for the organization. It provides clarity about the roles and responsibilities of each individual, making it easier to assign tasks and understand the scope of each position.
- It helps to improve communication and collaboration within the organization. It provides employees with a clear picture of the hierarchy and the chain of command, making it easier for them to understand their responsibilities and who they should contact for help or advice.
- It helps to promote accountability and responsibility. By having a clearly defined chain of command, it is easier to assign tasks and ensure that they are completed in a timely and efficient manner.
- It helps to improve efficiency. By having a clear structure, it is easier to identify tasks that can be delegated or automated, and it makes it easier to identify areas where resources can be better utilized.
- It helps to improve morale. An organization chart clarifies the roles and responsibilities of each individual, encouraging employees to work together as a team and take ownership of their roles.
Limitations of Organizational chart
An organization chart is a useful tool for visualizing the structure of an organization, however it has its limitations. These are:
- It does not show how work flows within the organization. An organizational chart is a static model, it does not show the detailed relationships between roles, tasks, and responsibilities.
- It does not provide insight into the operations and processes that the different roles and departments in the organization are involved in and how they interact.
- It does not provide any information about the capabilities of the people working in the organization.
- It is not dynamic and does not show changes that occur in the organization over time.
- It does not provide any useful information about the culture and values of the organization.
- It does not consider the external environment in which the organization operates and the impact of external forces on the organization.
Organizational chart is one of the most useful tools to understand the structure of an organization. Apart from Organization chart there are several other approaches, which help to understand the organization structure, such as:
- Functional Structure: It is the most common organizational structure, where the organization is divided into different departments and functions. Each department has its own manager and staff.
- Divisional Structure: It is based on the divisions of the organization. It is a structure where the organization is divided into separate units or divisions and each unit has its own hierarchy and staff.
- Matrix Structure: It is a combination of functional and divisional structure. It is a structure where the departments are grouped into functional and divisional structure.
- Flat Structure: In flat structure, the hierarchy is reduced to a minimum. This structure is mostly used in small organizations.
In summary, Organization chart is an important tool to understand the structure of an organization, but there are other approaches like functional structure, divisional structure, matrix structure and flat structure, which can also help to understand the organization structure.
- Allen, T. H. (1976). Communication Networks: The Hidden Organizational Chart. Personnel Administrator, 21(6), 31-35.