The benefits of having a good organization chart

Organizational charts are fundamental elements for any company, they generally serve to determine the organization of work and ensure that all members of the company know its structure.

All companies need an organizational chart, although it is true that there are different types of company organizational charts. Each of these charts have advantages and disadvantages and are applied according to the organizational needs of the company.

The company organizational chart is very useful for your employees to be productive, if they know at all times who to turn to and how the company or a project is structured, communication will be much faster and more effective.

In this article, we tell you what an organizational chart is, what types of organizational charts exist, and which charts are most useful for your company.

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What is an organizational chart?

An organizational chart of a company is simply a graphic representation of the company's structure. They include different aspects, they may represent the personal hierarchies of the company, or just its departments.

They may outline responsibilities, the relationships of the company's human capital, and the different functions of the employees, and are useful because their visual format makes them easy and quick to understand. Nowadays, we know that a good organizational chart can even help you make decisions.

It is also interesting to see how organizational charts allow us to understand the interrelationships between employees, departments, or managers in a company.

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Types of organization charts

Choosing one type of organizational chart or another depends on the information you want to extract from it. For example, a horizontal chart will not give you the same information as a functional one, and therefore, it will not be useful if you want to know the functions of each department rather than the hierarchies.

These are the types of organizational charts that exist and the use you can give to each one:

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Horizontal, vertical, or mixed organizational charts

Types of horizontal, vertical, or mixed organizational charts inform us about how the information is distributed.

In horizontal charts, information is distributed from top to bottom, important responsibilities on the left side, the rest on the right, and the departments or responsibilities of those people are indicated.

In vertical charts, the organization is also from top to bottom, although it is simpler than the horizontal one, as people or departments with more responsibility are placed at the top, and those with less responsibility at the bottom.

The difference between horizontal and vertical charts is that in horizontal ones, hierarchies are shown from left to right, with people or departments with more responsibility on the left. In contrast, in the vertical chart, hierarchies are shown from top to bottom, with the top being where the higher-ups are placed.

Mixed charts include both horizontal and vertical charts. The structure of the horizontal and the vertical is combined, with the highest positions being indicated at the top and the departments that interact and communicate frequently being indicated horizontally. It is one of the most popular today.

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Functional organizational chart

The functional organizational chart is also hierarchical, although it does not focus on people as the previous ones can do, but rather on departments. They are useful because when organized by departments, employees can consult it frequently when they need to go to a specific area of the company.

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Analytical organizational chart

The analytical organizational chart is known for being the most comprehensive. Its objective is to analyze the behaviour of the different departments of the company, providing the necessary information to make decisions. They do not always include departments or people, but it can be a chart of budget spending.

A very positive aspect of this type of organizational chart is that they are very adaptable, they can be applied to any situation in the company, and they serve for all employees to easily understand a situation and make decisions more quickly. Still, they must be up to date.

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Benefits of having a good organizational chart for your company

Organizational charts have multiple benefits, and even if your company is small, it is necessary for everyone to know the different departments and how they interrelate, as well as the organization of some projects if you opt for the analytical chart.

• They help us organize. They help define the company's departments or the main axes of business objectives. They are very useful for understanding key points of the company's structure.
• Show hierarchies. They show the relationships between employees in a company, serving everyone to know who to turn to in case of need or a problem.
• They are visual. They allow you to easily and quickly understand something that, if it were not visual, could easily be forgotten.
• They are updatable. It is important to consider that organizational charts are not a fixed scheme, but vary according to the changes the company undergoes and its organization, so it is a scheme to resort to whenever there are changes and it is necessary to explain them to employees.
• Improves internal communication. To foster business productivity, it is important to know how work is structured and organized in the company. Your employees should have a clear understanding, which will resolve many questions with organizational charts.

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