An organizational chart (org chart) is a visual aid used to clarify who reports to who, and who is responsible for what in your organization. It typically shows the business owner or department head at the top. It can be in the format of a drawing, diagram, flow chart, or picture. Most are stored as an electronic document, and often they’re printed and distributed to staff.
In this article, we’ll show you how to create an organizational chart. We’ll also share some tools to easily create org charts, find organizational chart templates, and suggest creative approaches for communicating your organizational structure.
Two Types of Organizational Charts
For the purpose of managing your small business, there are really only two types of org charts you’ll need to know about:
- Hierarchical/Top Down
- Matrixed/Cross-Functional
- Hierarchical/Top Down Organizational Chart
A hierarchical, or top down, organizational chart is a diagram that shows an organization’s reporting structure from the top down, starting with the business owner or department manager at the top of the chart, and employees who report to her appearing below her name. All roles appear in boxes connected by a line to illustrate reporting relationships.
- Matrixed/Cross-Functional Org Chart
A matrixed, or cross-functional, organizational chart shows multiple reporting relationships. It is used to depict complex business organizational structures with functional or project reporting relationships in addition to supervisory (top down, hierarchical) relationships. It shows both supervisory relationships such as ‘who is my boss’, as well as project or team relationships.
If your organization needs an organizational chart, there are many things to consider such as what tools to use (free or paid) to create it and what to include in your organization chart. Also, once your organizational chart has been created, how do you use it? More info will be provided in a later post.