Understanding Organizational Charts: Structure and Types
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What Is an Organizational Chart?
An organizational chart is a graphical representation of a company's structure. It serves to create a simplified view of the organization and acts as a vital tool for analyzing internal structures.
Its primary purpose is to encourage and lead employees in carrying out activities and communications that enable the organization to meet its goals.
Contents of the Charts
- Departmentalization: The grouping of jobs and departments.
- Chain of command: The line of authority and reporting relationships.
- Communication lines: The flow of information within the firm.
Advantages of Organizational Charts
- Provides a clear, visual representation of the organizational structure.
- Clearly defines reporting relationships and hierarchies.
- Serves as an effective induction tool for new staff to understand the company.
Disadvantages of Organizational Charts
- Can become obsolete if not updated regularly.
- Shows only formal relations of authority.
- Does not indicate the specific degree of authority for each office.
Types of Organizational Charts
By Nature
- Administrative Micro: Corresponds to a single organization.
- Administrative Macro: Involves more than one organization.
- Administrative Meso: Considers one or more organizations within the same sector of activity or production.
By Purpose
- Information: Designed for the general public and non-specialists.
- Analytical: Aims at the analysis of specific aspects of organizational behavior for specialists.
- Formal: A written document approved by the organization's board.
- Informal: Lacks formal written approval.
By Area
- General: A broad view of the organization.
By Content
- Integrated: Displays all administrative units of the organization, including relationships and dependencies.
By Graphical Presentation
- Vertical: Displays the chain of command from top to bottom.
