How to Make an Organizational Chart for a Company

How to Make an Organizational Chart for a Company

An organizational chart or organogram is a diagram that shows the structure of a company, institution or any kind of organization and the relationships and relative ranks of its parts, teams and individual members, clarifying everyone's position. In most cases, a company's staff structures and regulations can be found in a procedure manual specifying the role of each individual position so that new employees can better understand where they are.

A company without an organizational chart is often a disorganized company, which makes employee training and reaching goals much more difficult. With this in mind, we at oneHOWTO have provided a step-by-step guide on how to make an organizational chart for a company.

Choosing between a vertical and horizontal organizational chart

The first step in order to make an organizational chart for a company is to decide whether to create a horizontal (flat) or vertical (tall) structural diagram.

Vertically-structured companies have a chain of management, usually with someone in charge delegating authority to lower-level managers, and so on. A vertical organizational chart helps to discourage conflict of positions and misuse of resources, as it's easier to understand who to report to and what to take charge of.

An horizontal organizational chart is more common in larger companies and usually more extensive, as it works better when there are different teams in charge of different but linked or related projects.

Types of organizational structure

Each company has a different kind of organizational structure depending on its function and sector. This structure will be reflected in an organizational chart, which must be useful to explain what the company is and what it does to any newcomer.

Some organizational structure types include:

  • Functional structure: The company is organised by departments or functions, such as accounting, human resources, marketing, sales, etc. Here you can learn more about what are the functional areas of a business.
  • Product-based structure: Each product is placed under the supervision of an executive, and departments are organized according on what part of the product's process they contribute to.
  • Client-focused structure: The company is organized according to each type of client, as each group of clients has its own its problems and requirements.
  • Geographical structure: The company is organised according to location. This is common in sales companies.

How many organizational levels does your company need?

An organizational chart for a company shows the different management and employee levels, which will depend on the size of the company and the number of people in each department. The organisation will most likely grow over time, so it's reasonable to start with a basic model on which you can expand.

Drawing an organizational chart for a company

Once you are clear about the structure and hierarchy of your company, you can illustrate it in the form of a diagram, that is, you can draw the organizational chart.

You can do it on paper, or you can use a word processor like Microsoft Word. A quick search online will let you find free organigram and mind map software that you can easily use to make an organizational chart.

What you need to take into account before making an organizational chart

When you make a vertical organizational chart for a company it is too easy to forget to fill in horizontal, peer-to-peer relationships. Employees not only interact with their direct managements, but they also work in collaboration with other departments. It is good to help them find their way by linking them horizontally so that they can see who they should ask for help in different issues.

Of course, making an organizational chart at the start is not enough; you must remember to update it, as the people and their departments will change over time.

You can also substitute the traditional organigram or organizational chart for a more democratic organigraph. An organigraph finds new possible competition chances and collaborative teams by organizing companies into sets - that is, almost independent parts or departments - linked by a chain and coordinated by a hub, which manages the flow of productivity.


What is your advice on how to make an organizational chart for a company? Have you tried making an organigraph? Tell us all in the comments section!

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