what is organizational chart in business plan

• Credit cards
• View all credit cards
• Banking guide
• Loans guide
• Insurance guide
• Personal finance
• View all personal finance
• Small business
• Small business guide
• View all taxes

You’re our first priority. Every time.

We believe everyone should be able to make financial decisions with confidence. And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward — and free.

So how do we make money? Our partners compensate us. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services. Here is a list of our partners .

How to Create a Small Business Organizational Chart in 4 Easy Steps

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

Whether you're just starting out or have been in business for a while, creating and maintaining a business organizational chart can be an extremely helpful way to illustrate how your company operates and can also be used to show how you're going to grow and change in the future.

What is a small business organizational chart? A business organizational chart, sometimes also referred to as a "business org chart," is a visual representation of the structure of your business—it outlines the role of each employee and clarifies who reports to whom within your company. In many cases, developing and updating this chart will fall under the purview of your small business HR department, but if you don't currently have a separate human resources branch (or even if you do) it's worth understanding how these tables work and how to create one.

In this guide, therefore, we'll explain exactly how to create a business organization chart in four simple steps—discussing the various types of diagrams you can choose from, as well as the different goals you should consider when making an org chart for your company.

How to create a business organizational chart

Although looking at business organizational chart examples can be overwhelming, creating one of these diagrams for your company can be broken down into four easy steps. By taking this process one step at a time, you'll be able to decide which type of chart is best for your business and ultimately, develop a table (like many other operational documents you have) that can be utilized throughout the lifecycle of your business. With this in mind, let's get started:

Step 1: Decide how to structure your business organizational chart.

The first step in creating an org chart for your business is deciding what type of chart you want to use. Generally, there are four popular designs to consider and you'll want to choose the one that best suits your business's needs.

Hierarchical business organizational chart

To begin, a hierarchical diagram starts at the top of the business and works its way down the chain of command (as you can see below). A vertical line between individuals indicates that the employee above directly supervises the employee below. Hierarchies also show lateral relationships, where two people are on equal footing within the business framework, but may still collaborate or share responsibilities—these charts use horizontal lines to connect lateral workers. The business organization chart here shows how the company is structured starting with the CEO and progressing through the rest of the company.

Overall, most small businesses use a hierarchical organizational chart because it’s the simplest option. This being said, you can use this type of business org chart even if you only have a few names to fill in—as your business grows, it's easy to add new employees.

Functional business organizational chart

Next, you might consider a functional business organizational chart if your company is large enough to divide employees into departments. This type of diagram shows the head of each department and all the individuals who report to them. A functional chart is not entirely distinct from a hierarchical chart, but it does have a slightly different emphasis based on the different departments.

You can use this same information in all small business organization charts:

Name of employee (leave blank if the position is open)

Department (sales, marketing, accounting, operations, etc.)

Position or job title (sales representative, supervisor, account manager)

Description of duties (a brief phrase or two should be sufficient)

Location (if you have more than one office)

Contact information (physical address, phone number or extension, business cell phone number, work email address)

Photo (to recognize each other with ease)

As you can see, although the functional small business org chart is fairly similar to the hierarchical option, this diagram can be useful for distinguishing departments, giving a larger insight into how your company functions in this specific way.

Matrix business organizational chart

The third option, called a matrix or cross-functional business organizational chart, is useful if workers report to multiple supervisors. Like hierarchical graphs, matrix org charts illustrate the immediate supervisory relationships between employees, but they also show the project manager, team, or department to which an employee reports. Solid lines once again indicate that an individual is the primary manager of the person below them. Dotted lines demonstrate a less direct, but nonetheless important, reporting connection.

As this org chart from the Project Management Institute shows, the matrix small business organizational chart is often used by companies with project managers that work across different teams. Similarly, you may find that product, research, and engineering-based companies are more likely to utilize this type of diagram to illustrate their business structure.

Circle business organizational chart

Finally, the last option to consider is the circle business org chart. The circle diagram has become increasingly popular, especially among startup small businesses that wish to discard traditional business hierarchies. The idea behind these graphs is that all teams—and the employees that comprise them—play an equally important role in the company.

Once again, although this example shows dummy text, you can see how you would complete the chart based on your business's information. Each department makes up a spoke in the wheel and the employees within are listed in each section. As we discussed above, you would fill in essential information for each employee—name, job title, brief description, contact information, etc.

Ultimately, this first step may take time—you'll want to consider your business as it exists now and how you want it to grow—that way, you can determine which of these four org chart options will work best for illustrating your company structure.

Step 2: Collect employee information and categorize the data.

Now, once you’ve decided on the type of business organizational chart you’ll use, the rest of your chart development is fairly straightforward.

For your next step, therefore, you'll want to write a list of all the employees at your company and include the pertinent information about them that we mentioned above.

If you selected a hierarchical chart, you'll place each individual in their proper order on the list. The business owner occupies the first tier, anyone who reports directly to them belongs on the second tier, and the chart progresses from there. If you chose a functional or circle chart, you'll organize your list by each department, as shown in the examples we explained above. Finally, if you opted for a matrix small business org chart, you'll want to be sure to make note of all supervisory relationships.

Step 3: Decide how you'll complete your business org chart.

After you've gathered all of the information you need for your employees and categorized it based on the chart type you've selected, you'll want to determine how you're going to complete your chart. As you saw in our examples above, there are images and small business org chart templates you can download and edit using a software program like Adobe Photoshop.

On the other hand, you might choose to create your business organizational chart in a simple, reliable program you might already own, like Microsoft Office (Excel, Outlook, PowerPoint, or Word) or Google Sheets. You also have the option to purchase a template from a provider like SmartDraw or Lucidchart. To make the most out of your investment, however, you might consider purchasing an HR or payroll software that includes this functionality (among other features). As an example, Gusto's all-inclusive platform allows you to create an org chart within their system, as well as manage your essential payroll and HR tasks.

Although technically , you could diagram your small business org chart by hand, if you use an online template or software, you can modify your graph with ease as your business expands and staff changes.

Step 4: Fill in your business organizational chart and file it securely.

Finally, once you've chosen how you're going to complete your org chart, you'll be ready to actually fill it in.

With the data you've compiled, you'll fill in each box or branch of the chart that you’ve picked. Once again, if your diagram is hierarchical, you'll start with the owner or CEO of the business at the top. Then, you'll create a box below the owner for each person who is an immediate report, and draw a solid vertical line down from the proprietor to each of these supervisees. You'll continue this process for each layer in the company chain of command, and move down the corporate ladder until you’ve placed every employee on the chart.

If your graph is a functional design, you'll fill in the primary boxes with the information for the head of each department and the remainder with the information for every individual they directly manage. You'll follow the same procedure with a matrix chart—with this chart, however, don't forget to include secondary managers to the side of each department, and make dotted lines (or some other distinction) between boxes to represent those additional supervisory relationships.

Last, with a circle chart, you'll add the information employees and duties of each department to the corresponding pie slice, and your diagram is complete.

Once you've completed your small business org chart, you'll want to be sure you save it in a secure location—if you're not utilizing an HR software or another program that allows you to save it within that system. You'll want to keep your organizational chart on hand to update as your business grows and changes.

Along these lines, it's also helpful to store a copy of your org chart on a shared company server, drive, or employee portal so that everyone in your company can see it (but not change it)—this way, everyone in your organization can understand how the company is structured and refer back to the chart as needed.

How much do you need?

with Fundera by NerdWallet

We’ll start with a brief questionnaire to better understand the unique needs of your business.

Once we uncover your personalized matches, our team will consult you on the process moving forward.

Small business organizational chart templates

If you're not ready to invest in a software platform to build your diagram, you may be interested in exploring different small business organizational chart templates. As we mentioned, there are well-known solutions, like Microsoft Office, that offer org chart templates that you can download and use for your business. Let's look at a few examples:

Microsoft Office : Within the templates section of the Office website, you can find various, free business org chart templates that you can download for free and customize within PowerPoint, Word, or Excel. For a simple hierarchical chart option, you might start with this "Minimal organization chart."

24Slides : Among other business template options, 24Slides offers free small business org chart templates that you can copy and edit within Google Slides. They also offer these templates in different types including the classic hierarchical chart, as well as the circle chart.

Canva: Image editing and graphics platform Canva allows you to design and customize your own business organizational chart (for free, you just need to sign up for an account) using their system.

Vizzlo : Although Vizzlo does offer paid plans, with their free version, you can access over 100 different chart types, including small business org templates. Plus, you have the option to edit your template within Vizzlo, or create your chart direct in PowerPoint or Google Slides using a Vizzlo integration.

Of course, these are only a few options—there are numerous additional templates and examples you can find by searching and browsing online.

The benefits of a business org chart

As we've shown through our four-step guide, creating a business organizational chart can be a fairly straightforward and simple process. However, if you're just starting out, or don't have a dedicated employee or department to work on developing this graph, you may be wondering if you really need an org chart. Ultimately, the decision is up to you—but, to this end, it's worth highlighting some of the benefits of one of these diagrams and why they can be so useful for your small business.

Clarify management structure

If you're just starting your business the process necessary to construct a business organizational chart forces you to officially distribute tasks and flesh out the roles of each individual and the purpose of each department in your enterprise. This avoids confusion later, as your business grows. Of course, you can always restructure your business organizational chart down the road—however, if you outline the expectations for each position early on, you’re already a step ahead in the entrepreneurial process.

On the other hand, if your company is more established, a business org chart helps both new and existing employees to understand where they fit within the company’s framework, which clarifies any questions regarding the chain of command. This transparency saves time and increases efficiency, as workers can consult your organizational chart and determine exactly who to speak with when faced with a given issue. Plus, if your business organizational chart is well-structured, your employees will already know not just the name of the proper individual to consult, but also what position they hold and what responsibilities they oversee.

Increase operating efficiency

Another benefit of creating and maintaining a small business org chart is that by doing so, you can examine your company’s current structure and unearth potential ways to improve it. Are certain employees responsible for too many tasks, and others too few? Is there unnecessary overlap between individual workers? Are there any duties that fall through the cracks? Should you reorganize in order to meet those needs, hire additional workers, or possibly even outsource these assignments? You may find that you can better utilize the workers you already have, and thereby increase productivity.

A business organizational chart can also improve cross-functional communication throughout your business, which leads to more effective project management. It’s easier to accomplish tasks that involve multiple workers or teams when the reporting structure is clear, and everyone knows who to talk to about what.

Demonstrate current success

Even if you think that your business wouldn’t benefit from an organization chart, you may find that potential lenders want to see one when you're applying for financing. Similar to a business plan, banks, institutions like the SBA, and potential investors want assurance that you’ve carefully considered the structure of your business, as such preparation is often an indicator of future success.

As financial professionals, they’ll also want to ensure that the business organizational method you’ve chosen is one that they believe is likely to prosper—so that you can pay back your potential business loan on time.

Facilitate future planning

Finally, a small business organizational chart can help you prepare for the evolution and expansion of your business. In this vein, we'd recommend that you create two versions of your organization chart: one that reflects your current company structure and one that shows your growth objectives. You might even consider additional charts that indicate how you might reorganize should unexpected changes occur, like reductions in funding or the sudden departure of a key employee.

Your second business organizational chart, of course, will have a lot of blank spaces—room for all the positions you’d like to fill in the future as implement your business growth strategies. In this way, you can use your chart to find possible holes that exist in your current staffing, and you’ll have a built-in roadmap for future hiring.

Start Your Dream Business

The bottom line

At the end of the day, taking the time to plan and create a business org chart can be extremely beneficial for your small business—now and in the future. Whether you develop this diagram yourself, or work with your team to do so, you can follow our four simple steps to complete the process relatively quickly and easily.

Plus, if you already utilize a payroll or HR software, you can check to see if your platform already includes an org chart builder. If it doesn't, you might decide to use one of the templates we've discussed here. On the other hand, if you don't have an HR or payroll software, you might consider exploring some of the top options out there—Gusto, Zenefits, etc.—as any of these solutions will not only allow you to create a small business org chart, but will also help you efficiently and effectively an important part of your day-to-day operations.

This article originally appeared on JustBusiness, a subsidiary of NerdWallet.

On a similar note...

• Search Search Please fill out this field.

What Is an Organizational Chart?

• How It Works

Hierarchical Organizational Chart

• Other Types
• Organizational Chart FAQs

The Bottom Line

• Business Essentials

Organizational Chart Types, Meaning, and How It Works

James Chen, CMT is an expert trader, investment adviser, and global market strategist.

Erika Rasure is globally-recognized as a leading consumer economics subject matter expert, researcher, and educator. She is a financial therapist and transformational coach, with a special interest in helping women learn how to invest.

Investopedia / Yurle Villegas

An organizational chart is a diagram that visually conveys a company's internal structure by detailing the roles, responsibilities, and relationships between individuals within an entity. It is one way to visualize a bureaucracy .

Organizational charts are alternatively referred to as "org charts" or "organization charts."

Key Takeaways

• An organizational chart graphically represents an organization's structure, highlighting the different jobs, departments, and responsibilities that connect the company's employees to each other and to the management team.
• Organizational charts can be broad-based, depicting the overall company, or can be department- or unit-specific, focusing on one spoke on the wheel.
• Most org charts are structured by using the "hierarchical" model, which shows management or other high-ranking officials on top, and lower-level employees beneath them.
• Other types of charts include the flat org chart, the matrix chart, and the divisional org chart.

Understanding Organizational Charts

Organizational charts either broadly depict an enterprise organization-wide, or drill down to a specific department or unit.

Organizational charts graphically display an employee's hierarchical status relative to other individuals within the company. For example, an assistant director will invariably fall directly below a director on the chart, indicating that the former reports to the latter. Organizational charts use simple symbols such as lines, squares, and circles to connect different job titles that relate to each other.

Regardless of an organization's structure, org charts are extraordinarily useful when an entity is contemplating restructuring its workforce or changing its management complex. Most importantly, org charts let employees transparently see how their roles fit into the overall company structure.

This most common model situates the highest-ranking individuals atop the chart and positions lower-ranking individuals below them. Organizational hierarchies generally depend on the industry, geographical location, and company size.

For example, a public company typically shows shareholders in the highest box, followed by the following in descending vertical order:

• Chair of the board of directors
• Vice-chair of the board
• Board members
• Chief executive officer ( CEO )
• Other C-suite executives (joined to one another by horizontal lines)

Other job titles that may follow c-suite execs include:

• Senior vice president
• Vice president
• Assistant vice president
• Senior director
• Assistant director
• Assistant manager
• Full-time employees
• Part-time employees
• Contractors

Many formal organizations are organized hierarchically and can be shown in chart form. These include corporations but also nonprofits, governments, schools & universities, and the military (as the chart below illustrates).

There is no single correct way to fashion an organization chart, as long as it identifies the officials, employees, departments, and functions of the firm, and how they interact with each other.

Other Types of Organization Charts

• Flat — also known as a "horizontal" chart, the flat org chart positions individuals on the same level or only a few levels, indicating more power equality and autonomous decision-making ability than is typical with employees in hierarchical corporations.
• Matrix — This more complicated organizational structure groups individuals by their common skill-sets, the departments in which they work, and the people they may report to. Matrix charts often interconnect employees and teams with more than one manager, such as a software developer who is working on two projects—one with their regular team manager, and another with a separate product manager. In this scenario, the matrix chart would connect the software developer to each manager they are working with, with vertical lines.
• Divisional — This chart subdivides the company based on some specific criteria. It could be by product lines offered or geographic regions. An example would be an auto manufacturer organizing its company by product type. The respective divisions would have a certain autonomy but this would likely incur additional overhead cost.

What Should an Organizational Chart Show?

An organizational chart should visually show what the hierarchical status of a particular employee relative to other individuals within the company. For example, an assistant director will invariably fall directly below a director on the chart, indicating that the former reports to the latter. 

Why Is an Organizational Chart Important?

Org charts depict an organization's hierarchy, which can clearly identify seniority and lines of authority that ought to be followed. It can also show which roles are responsible for what tasks, divisions, departments, or regions. This can remove ambiguity and improve communication.

What Are the Most Commonly Used Organizational Charts?

The two types of organizational chart formats that are most often used are hierarchical and flat. Hierarchical is the most common and it shows the ranking of individuals based on their role in the company in a descending vertical order. A flat format, also known as a "horizontal" organizational chart, places all individuals on only a few levels or just one level, and is indicative of an autonomous decision-making ability where this power is equally shared.

How Do I Make an Organizational Chart?

There are software packages and web templates available to help make an organizational chart. You can even produce one by hand. The key is to depict the organization's hierarchy, with more senior positions at the top. Underneath each position should be subordinate positions and roles, which may be segregated by division or department. Depending on how the organization is structured in reality, the chart should approximate it.

What Are Other Types of Organizational Charts?

Less commonly used, but still effective in defining roles, are the matrix and divisional organizational charts. The matrix organizational chart groups individuals by their common skill-sets, the departments in which they work, and the people they report to. It is dubbed "matrix" as it shows employees and teams interconnecting with more than one manager. Divisional would show the organization of a company based on some specific criteria, say a product line or geographical area. For example, an auto manufacturer might be organized based on the different types of products they offer.

Organizational charts allow one to visually understand an organization's structure and hierarchy. This can give an overview of how information and instructions are deployed through organizations, which can range from government bodies to corporations to the military. The most senior positions appear at the top of the chart with subordinate roles falling under them. The chart's appearance and flow will vary depending on an organization's size and how its roles are arranged.

• Terms of Service
• Editorial Policy
• Privacy Policy
• Your Privacy Choices

Diagramming Build diagrams of all kinds from flowcharts to floor plans with intuitive tools and templates.

Whiteboarding collaborate with your team on a seamless workspace no matter where they are., data generate diagrams from data and add data to shapes to enhance your existing visuals., enterprise friendly easy to administer and license your entire organization., security see how we keep your data safe., apps & integrations connect to all the tools you use from microsoft, google workspace, atlassian, and more..

• What's New Read about new features and updates.

Product Management Roadmap features, brainstorm, and report on development, so your team can ship features that users love.

Software engineering design and maintain complex systems collaboratively., information technology visualize system architecture, document processes, and communicate internal policies., sales close bigger deals with reproducible processes that lead to successful onboarding and training..

• Getting Started Learn how to make any type of visual with SmartDraw. Familiarize yourself with the UI, choosing templates, managing documents, and more.
• Templates get inspired by browsing examples and templates available in SmartDraw.

Diagrams Learn about all the types of diagrams you can create with SmartDraw.

Whiteboard learn how to combine free-form brainstorming with diagram blueprints all while collaborating with your team., data visualizers learn how to generate visuals like org charts and class diagrams from data., development platform browse built-in data visualizers and see how you can build your own custom visualization., open api the smartdraw api allows you to skip the drawing process and generate diagrams from data automatically., shape data add data to shapes, import data, export manifests, and create data rules to change dashboards that update..

• Explore SmartDraw Check out useful features that will make your life easier.
• Blog Read articles about best practices, find tips on collaborating, learn to give better presentations and more.

Support Search through SmartDraw's knowledge base, view frequently asked questions, or contact our support team.

Site license site licenses start as low as $2,995 for your entire organization..

• Team License The SmartDraw team License puts you in control with powerful administrative features.

Apps & Integrations Connect to all the tools you use.

• Contact Sales

What's New?

Solutions By Team

Save money, reduce hassle, and get more.

Unleash your team's productivity by combining enterprise-class diagramming, whiteboarding, and data while saving 10x over Visio and Lucidchart!

Getting Started Learn to make visuals, familiarize yourself with the UI, choosing templates, managing documents, and more.

Templates get inspired by browsing examples and templates available in smartdraw., developer resources, additional resources.

Team License The SmartDraw Team License puts you in control with powerful administrative features.

Solutions for your team.

Organizational Chart

Visualize employee information quickly from templates or data, what is an organizational chart, organizational chart templates, organization chart types, 10 tips for perfect org charts, how to make an organizational chart, org chart tutorial, rules for formatting org charts, with smartdraw, you can create many different types of diagrams, charts, and visuals.

The definition of an organization chart or "org chart" is a diagram that displays a reporting or relationship hierarchy. The most frequent application of an org chart is to show the structure of a business, government, or other organization.

Org charts have a variety of uses, and can be structured in many different ways. They might be used as a management tool, for planning purposes, or as a personnel directory, for example. Perhaps your organization doesn't operate in a "command and control" style, but instead relies on teams.

Here are some ideas and examples to help you design the perfect organizational chart for your needs.

How Organization Charts Are Used

Organizational charts are useful in a number of ways. Here are a few of the ways your company or group can benefit from an org chart.

• Show work responsibilities and reporting relationships.
• Allow leadership to more effectively manage growth or change.
• Allow employees to better understand how their work fits into the organization's overall scheme.
• Improve lines of communication.
• Create a visual employee directory.
• Present other types of information, such as business entity structures and data hierarchies.

The type of organization chart you make should mirror the management philosophy and organizational structure of your company.

There are four basic types of organizational charts:

• Functional Top-Down
• Divisional Structure
• Matrix Organizational Chart
• Flat Organizational Chart

Learn more about organizational chart types .

Tips For Making Org Charts

Creating a perfectly formatted, professional-looking organization chart doesn't require special skill, but it also doesn't happen by accident. Here are 10 helpful tips for creating a perfect org chart.

How to Make an Organizational Chart

We usually think of an organization chart of having a fairly rigid, top-down structure. Here's the format of a basic three-level org chart.

But just as one size business suit doesn't fit everyone, the same can be said of an organizational chart. You'll want to custom-tailor an org chart to fit the needs of your organization. There are a lot of factors to consider. What type of information should be included in each box? Should the chart flow top-down or in another direction? What if there are people with multiple roles?

The answers to these and other questions will help you decide how to create an organizational chart to fit your unique situation.

Additional Org Chart Resources

Video: how to make an org chart with smartdraw.

This informational video offers a brief overview of how to get started making an org chart with SmartDraw. Starting with an org chart template, this video takes you through the basics of creating a SmartDraw org chart. In less than four minutes, it shows you how to make an org chart that looks professionally produced.

Using Org Charts Online

Go beyond the printed org chart. Online org charts are interactive. They let you create hyperlinks to other information and resources. They are easy to share and distribute within or outside your organization. Plus, an online org chart doesn't have to be reprinted and redistributed, so it's much easier to keep up to date.

Org Charts and Microsoft Office ®

More than 90 percent of organizations supply Microsoft Office ® to their workers. Many try to make an org chart using Smart Art, and find it frustrating. Fortunately, SmartDraw integrates easily with the Microsoft Office ® suite, as well as with other popular services such as Dropbox ® , Google Drive ™ , and OneDrive ® . Not only is it easier to create an org chart in SmartDraw, but learn how easy it is to transfer an organizational chart created in SmartDraw to any Microsoft Office ® product.

Create an Organizational Chart from Imported Data

Perhaps the easiest way to create an org chart is to generate it automatically from a data file that lists all of the employees and who they report to. Learn how here .

Organizational Chart Examples

The best way to understand organizational charts is to look at some examples of organizational charts.

Org chart templates can give you a good starting point for making an org chart. Browse and edit popular org chart templates .

Click on any of these organizational charts included in SmartDraw and edit them:

Browse SmartDraw's entire collection of org chart examples and templates

More Organizational Chart Information

• Org chart software and maker
• Org chart for Mac
• Organizational chart and Microsoft Office ®
• Online org chart and web app
• OrgPlus ® alternative
• Org charts templates for Excel®
• SmartDraw reviews
• Organizational templates for Word ® , PowerPoint ® , Excel ®
• Organigram software
• Hierarchy chart software
• Organigramas
• Organogram template maker
• Lucidchart alternative
• Visio ® for Mac

Try SmartDraw's Organizational Chart Software Free

Discover why SmartDraw is the best organizational chart software today.

• Product overview
• All features
• App integrations

CAPABILITIES

• project icon Project management
• Project views
• Custom fields
• Status updates
• goal icon Goals and reporting
• Reporting dashboards
• workflow icon Workflows and automation
• portfolio icon Resource management
• Time tracking
• my-task icon Admin and security
• Admin console
• asana-intelligence icon Asana Intelligence
• list icon Personal
• premium icon Starter
• briefcase icon Advanced
• Goal management
• Organizational planning
• Campaign management
• Creative production
• Content calendars
• Marketing strategic planning
• Resource planning
• Project intake
• Product launches
• Employee onboarding
• View all uses arrow-right icon
• Project plans
• Team goals & objectives
• Team continuity
• Meeting agenda
• View all templates arrow-right icon
• Work management resources Discover best practices, watch webinars, get insights
• What's new Learn about the latest and greatest from Asana
• Customer stories See how the world's best organizations drive work innovation with Asana
• Help Center Get lots of tips, tricks, and advice to get the most from Asana
• Asana Academy Sign up for interactive courses and webinars to learn Asana
• Developers Learn more about building apps on the Asana platform
• Community programs Connect with and learn from Asana customers around the world
• Events Find out about upcoming events near you
• Partners Learn more about our partner programs
• Support Need help? Contact the Asana support team
• Asana for nonprofits Get more information on our nonprofit discount program, and apply.

Featured Reads

• Business strategy |
• How to create an organizational chart ( ...

How to create an organizational chart (with free examples)

An organizational chart outlines how your company functions in real time. This diagram shows the reporting relationships between job titles and the roles in your organization. We’ll explain the different types of organizational charts and provide free templates for you to customize your own.

You’re having a family dinner when your grandma pulls out the family tree. She uncrinkles the piece of paper and traces her name down the line. As she searches, her finger lands on a name. “See! There he is, right next to your cousin Charles!” She points to the name of your third cousin, proving that this name matches that of a famous poet. 

In this guide, we’ll explain how to make an org chart, the different types of organizational charts, and provide free templates so you can customize and build your own.

How to make an organizational chart

An organizational chart is a way to visualize your company’s structure. To create an org chart, you’ll need to gather team member information and decide how you’d like to build the chart. 

As you consider the reporting relationships in your organization, you can plan your chart from top to bottom. 

1. Define scope

You can treat your organizational chart like any other new project you work on. Defining the scope of your org chart can help ensure it clearly represents your team structure . The scope will determine the overall purpose of your organizational chart.

Consider these questions to get started:

Will your org chart act as a resource for team members to know who’s who within the company? 

Will you share your organizational chart with external stakeholders or partners? 

Will you need multiple charts for different levels of the company? 

Asking these questions from the start can help you gather the right information and map out your chart.

2. Gather information

Gathering information is the most important step of making an organizational chart because without the right information, you won’t be able to proceed.  You can gather information by surveying individual team members through email or working with your HR department. 

You’ll need up-to-date information about the people in your company, including employee names and their latest job titles. You’ll also need to understand reporting relationships throughout your company, such as the hierarchy between managers and direct reports. Consider gathering headshots of your team for added personalization.

3. Decide how to build your chart

Deciding how to build your organizational chart is crucial because different tools can make the process easier. Drawing out your org chart by hand isn’t time efficient and will make your results hard to share, so consider harnessing the power of a tool for this process. 

Using an editable PDF can save you time because the template is pre-built with placeholders. You can then easily share the PDF with the rest of your company. 

4. Plan for updates

After creating your org chart, use a team calendar to plan for regular updates. After all, it’s likely that your company structure and team dynamics will change often. 

People switch in and out of positions, new employees are hired, and reporting relationships change. With a digital org chart, it’s easy to update the structure and redistribute it to team members.

Organizational chart templates

Creating an organizational chart can be easier when building from an org chart template. Most companies follow similar structures, whether it’s a top-down structure or a matrix structure. 

You can use the org chart examples below as jumping-off points. To create your custom org chart, determine which organizational type best represents your company structure. Then, update the template to fit your unique team needs.

Types of organizational charts

There are four common org chart types. Each one of these charts uses a different chart design and represents a different way that a company might function. Since an organizational chart is basically a hierarchy chart—a visual translation of your company’s internal structure—the chart type you use should mirror your organization’s reporting relationships and decision-making procedures.  

1. Functional top-down

A functional top-down org chart is the most common structure, with the company functioning as a hierarchy. At the top of this organizational structure there is one team member, who usually has the title of president or CEO. 

Branching off from that team member are the leaders who are next in charge, like the company vice presidents. The organizational hierarchy extends further into departments and eventually branches into teams. 

2. Matrix organizational chart

The matrix organization is a more complex structure than the traditional top-down design. If your company uses this reporting structure, team members report to multiple managers. 

While employees likely have a primary manager they report to for their department, they may also report to a project manager . These secondary project managers also have department managers they report to, which makes the matrix org chart look rectangular instead of tree-like. 

3. Divisional structure

A divisional organizational structure is a high-level version of the traditional hierarchical structure. Divisional structures make sense for companies that have departments working independently from one another. 

For example, companies with separate product lines may work in divisional structures because each product line has separate IT, marketing, and sales departments.

4. Flat organizational chart

The flat organizational chart is unique because it shows few or no levels of management. This type of organizational structure may be present in a small business or a modern business that’s experimenting with no chain of command. 

With this type of organizational structure, the company promotes wide-spread team member self-management and decision-making. 

How to use an org chart

You can benefit your company by using an organizational structure because it provides a visual representation of different departments and job titles in action. This chart can help team members understand how to collaborate with one another and feel confident in their role and responsibilities. 

Visualize reporting relationships

As a manager, you may use an org chart to show work responsibilities and reporting relationships to new team members. When onboarding new hires, the org chart helps team members get to know their fellow teammates and what they do. It also helps new team members remember who’s who within the company. 

Manage growth and change

Organizational charts can also help the leadership team stay organized and manage growth or change within the company. For example, if a department head notices that one team has become larger than other teams, they can shift or hire new team members to create balance.

See where everyone fits

An org chart creates clarity by showing everyone in the company where they fit in the organizational structure. If a new member joins the team, they can glance at the organizational chart and understand that they have five other members on their team, two assistants below them, and a project manager above them. They can also see that their project manager reports to a department manager.

Improve communication

Having an established organizational structure for your company can improve communication because it makes reporting relationships clear. Without an organizational chart in place, team members may not know who to go to when they have questions. The org chart makes it clear who leads what, so team members can feel empowered to ask questions and collaborate with others.  

Create visual directory

An org chart is essentially a visual directory of your organization. You can  update the chart when team members get promoted or when they leave. Keeping a visual directory up to date keeps everyone informed of who’s working at the company and what their current position is.

Limitations of using an org chart

While organizational charts can increase communication among teams, there are limitations of using them. Knowing these limitations can help you find solutions to any potential issues before they occur.

Can get outdated quickly

Org charts can get outdated quickly as companies restructure and shift team roles. Team members must be mindful and keep the org chart updated with current company structure and staff names. 

Solution: Assign someone to regularly update and redistribute your organizational chart in order to maintain this valuable resource.

Only shows formal relationships

The organizational chart is a one-dimensional document, so it doesn’t offer much explanation beyond the reporting structure it provides. While it’s useful in visualizing the basic company structure, it only shows formal relationships. Many companies function and thrive on various informal reporting relationships that wouldn’t show up on a traditional org chart. 

Solution: Use an org chart as a jumping off point, but keep in mind there may be other working relationships that the org chart doesn’t capture.

Doesn’t display management style

While the org chart shows managers and the team members that report to them, it won’t show what each manager is like. For example, the org chart may show that one manager has two team members and another manager has five team members. Assumptions may be made that the manager with more team members is a stronger leader, but the org chart won’t show that the manager with less team members has a more hands-on management style . 

Solution: Use your org chart as a first point of reference, but be mindful that face to face contact is the best way to understand reporting relationships among internal teams.

Can be difficult to update

Not only can printable org chart worksheets or drawn-out organization charts become outdated quickly, they can also be difficult to update. After all, if your chart is created in a static tool, you’ll have to start from scratch every time your organization’s structure changes.

Solution: Instead of creating your chart in a fixed workspace, opt for a dynamic tool. Platforms like Microsoft Word, PowerPoint, and Excel are easily updated. Or, take it one step further with org chart software or a project management tool that uses integrations and apps to connect your team to data visualizers that map out workflows, like LucidChart and Miro .

Streamline your organizational structure with a chart

While there are limitations to organizational charts, these charts offer a helpful way to understand your company structure. It can also improve communication with upper management by clarifying roles and responsibilities. To build an organizational chart for your company, use our free editable PDFs and customize them as you see fit. 

Need help streamlining teamwork? Find out how Asana helps teams communicate effectively. 

Related resources

What is management by objectives (MBO)?

Write better AI prompts: A 4-sentence framework

How to find alignment on AI

What is content marketing? A complete guide

• Search Search Please fill out this field.
• Building Your Business
• Becoming an Owner
• Business Plans

Writing the Organization and Management Section of Your Business Plan

What is the organization and management section in a business plan.

• What to Put in the Organization and Management Section

Organization

The management team, helpful tips to write this section, frequently asked questions (faqs).

vm / E+ / Getty Images

Every business plan needs an organization and management section. This document will help you convey your vision for how your business will be structured. Here's how to write a good one.

Key Takeaways

• This section of your business plan details your corporate structure.
• It should explain the hierarchy of management, including details about the owners, the board of directors, and any professional partners.
• The point of this section is to clarify who will be in charge of each aspect of your business, as well as how those individuals will help the business succeed.

The organization and management section of your business plan should summarize information about your business structure and team. It usually comes after the market analysis section in a business plan . It's especially important to include this section if you have a partnership or a multi-member limited liability company (LLC). However, if you're starting a home business or are  writing  a business plan for one that's already operating, and you're the only person involved, then you don't need to include this section.

What To Put in the Organization and Management Section

You can separate the two terms to better understand how to write this section of the business plan.

The "organization" in this section refers to how your business is structured and the people involved. "Management" refers to the responsibilities different managers have and what those individuals bring to the company.

In the opening of the section, you want to give a summary of your management team, including size, composition, and a bit about each member's experience.

For example, you might write something like "Our management team of five has more than 20 years of experience in the industry."

The organization section sets up the hierarchy of the people involved in your business. It's often set up in a chart form. If you have a partnership or multi-member LLC, this is where you indicate who is president or CEO, the CFO, director of marketing, and any other roles you have in your business. If you're a single-person home business, this becomes easy as you're the only one on the chart.

Technically, this part of the plan is about owner members, but if you plan to outsource work or hire a virtual assistant, you can include them here, as well. For example, you might have a freelance webmaster, marketing assistant, and copywriter. You might even have a virtual assistant whose job it is to work with your other freelancers. These people aren't owners but have significant duties in your business.

Some common types of business structures include sole proprietorships, partnerships, LLCs, and corporations.

Sole Proprietorship

This type of business isn't a separate entity. Instead, business assets and liabilities are entwined with your personal finances. You're the sole person in charge, and you won't be allowed to sell stock or bring in new owners. If you don't register as any other kind of business, you'll automatically be considered a sole proprietorship.

Partnership

Partnerships can be either limited (LP) or limited liability (LLP). LPs have one general partner who takes on the bulk of the liability for the company, while all other partner owners have limited liability (and limited control over the business). LLPs are like an LP without a general partner; all partners have limited liability from debts as well as the actions of other partners.

Limited Liability Company

A limited liability company (LLC) combines elements of partnership and corporate structures. Your personal liability is limited, and profits are passed through to your personal returns.

Corporation

There are many variations of corporate structure that an organization might choose. These include C corps, which allow companies to issue stock shares, pay corporate taxes (rather than passing profits through to personal returns), and offer the highest level of personal protection from business activities. There are also nonprofit corporations, which are similar to C corps, but they don't seek profits and don't pay state or federal income taxes.

This section highlights what you and the others involved in the running of your business bring to the table. This not only includes owners and managers but also your board of directors (if you have one) and support professionals. Start by indicating your business structure, and then list the team members.

Owner/Manager/Members

Provide the following information on each owner/manager/member:

• Percentage of ownership (LLC, corporation, etc.)
• Extent of involvement (active or silent partner)
• Type of ownership (stock options, general partner, etc.)
• Position in the business (CEO, CFO, etc.)
• Duties and responsibilities
• Educational background
• Experience or skills that are relevant to the business and the duties
• Past employment
• Skills will benefit the business
• Awards and recognition
• Compensation (how paid)
• How each person's skills and experience will complement you and each other

Board of Directors

A board of directors is another part of your management team. If you don't have a board of directors, you don't need this information. This section provides much of the same information as in the ownership and management team sub-section. 

• Position (if there are positions)
• Involvement with the company

Even a one-person business could benefit from a small group of other business owners providing feedback, support, and accountability as an advisory board. 

Support Professionals

Especially if you're seeking funding, let potential investors know you're on the ball with a lawyer, accountant, and other professionals that are involved in your business. This is the place to list any freelancers or contractors you're using. Like the other sections, you'll want to include:

• Background information such as education or certificates
• Services provided to your business
• Relationship information (retainer, as-needed, regular, etc.)
• Skills and experience making them ideal for the work you need
• Anything else that makes them stand out as quality professionals (awards, etc.)

Writing a business plan seems like an overwhelming activity, especially if you're starting a small, one-person business. But writing a business plan can be fairly simple.

Like other parts of the business plan, this is a section you'll want to update if you have team member changes, or if you and your team members receive any additional training, awards, or other resume changes that benefit the business.

Because it highlights the skills and experience you and your team offer, it can be a great resource to refer to when seeking publicity and marketing opportunities. You can refer to it when creating your media kit or pitching for publicity.

Why are organization and management important to a business plan?

The point of this section is to clarify who's in charge of what. This document can clarify these roles for yourself, as well as investors and employees.

What should you cover in the organization and management section of a business plan?

The organization and management section should explain the chain of command , roles, and responsibilities. It should also explain a bit about what makes each person particularly well-suited to take charge of their area of the business.

Want to read more content like this? Sign up for The Balance’s newsletter for daily insights, analysis, and financial tips, all delivered straight to your inbox every morning!

Small Business Administration. " Write Your Business Plan ."

City of Eagle, Idaho. " Step 2—Write Your Business Plan ."

Small Business Administration. " Choose a Business Structure ."

Nice to meet you.

Enter your email to receive our weekly  G2 Tea newsletter  with the hottest marketing news, trends, and expert opinions.

What Is an Organizational Chart? (+Examples and Free Template)

March 22, 2019

by Tricia Dempsey

Whether your business has 5 employees or 5,000 employees, organizational charts are a vital visual representation of your company’s internal structure.

It’s easier to understand the benefits of an organizational chart, colloquially known as an org chart, when you imagine your business as an upside-down tree. A startup business might resemble a small birch tree with a few branches and an enterprise might resemble a large redwood tree with an abundance of large and small branches.

Org charts, like trees, spread out into supplementary branches and leaves that define each individual’s role in a company. An org chart paints a detailed picture of the internal structure of a business. If you’re restructuring roles or if you just want to give your employees added transparency, org chart software is an easy opportunity to map each employee in a straightforward view.

What is an organizational chart?

Let’s start by covering the basics of an org chart.

Organizational chart definition

An org chart is a diagram that shows the internal structure of a business. The chart helps visualize the hierarchy of business units and employees to better understand the rankings (levels) and relationships within the organization.

There are no hard and fast rules for making an org chart. As long as the chart is organized by rank with clear branches exhibiting employee relationships, the diagram itself is open to many creative possibilities depending on the industry, the number of employees, and the number of rankings.

Types of organizational charts

While the hierarchical org chart structure is the most well-known, there are other notable org charts to mention, as well. These include the following:

Hierarchical organizational chart

Typically in the shape of a pyramid, a hierarchical org chart features the first-in-command, or the highest-ranked employee or collectively ranked group, at the top of the chart. Some common first-in-command examples include a managing board or a CEO (chief executive officer). Lower-ranked employees are featured below the highest-ranked employee or group on the chart. Each employee is connected to another employee or group that they report to.

Matrix organizational chart

Matrix org charts are similar to hierarchical org charts, except they’re ideal for employees or teams that have multiple managers that they report to. For example, if a marketing team often collaborates with a sales team, they may need an org chart that visualizes the connection between separate project managers and project members.

Flat organizational chart

Flat organizational charts, also known as horizontal organizational charts, reflect a hierarchy with little to no middle management. Small companies typically benefit from using a flat org chart where employees report directly to the top department executives.

Organizational chart relationship visualization

While each org chart type differs slightly, they each require the same visual representation of the chain of command (line relationships) and same-level connections (lateral relationships). These connections visually tell a story about each employee’s status in the company.

Line relationship visualization

An example of a line relationship visualization is someone with a higher ranking than another employee being placed above the employee, with a line directed toward the lower-ranking employee.

Lateral relationship visualization

An example of a lateral relationship visualization is simply employees located next to each other on the chart due to their having the same rank.

Lines are the most common symbol used to identify employee relationships, but feel free to get a little creative with the symbol you use. For charts that are more complex, it’s not out of the ordinary to use dotted lines and solid lines with different meanings. As long as the symbols you use in your org chart map the journey of authority in a clear way, there are no hard-set rules to follow when creating your org chart. Feel free to use photos and unique shapes when creating yours!

Why should you use an organizational chart?

There are a multitude of benefits to creating an org chart for a business of any size. First and foremost, it establishes authority and strictly enforces the expected communication routes within the organization. This prevents miscommunication and helps employees understand where they are in the hierarchy of the company. Additionally, companies that restructure their hierarchy owe it to their current employees to be transparent and upfront about changes in communication and authority by illustrating those changes with a new org chart. Above all, it helps everyone in the company to be on the same page in terms of who is responsible for what.

Disadvantages of an organizational chart

While the benefits of org charts are clear, there are a few drawbacks. For example, org charts require a lot of upkeep. Promotions, resignations and general title changes happen all the time in all industries, making org charts out of date very quickly. However, using a template that is easily changed can prevent editing headaches. Additionally, org charts can be frustrating for organizations that are highly collaborative. Even though matrix org charts help mitigate this, it can be rather difficult to portray the formal communications between employees that collaborate with many different departments. This can be remedied to an extent; for example,  detailed symbols can help visualize the nuances.

How to make an organizational chart

Before starting a company org chart, it’s important to take some time to figure out everyone’s position in the organization and how each position interlinks with others. Once this information is attained, the next step is to decide whether a hierarchical, matrix or flat organizational chart fits your needs. Next, take a look at our free templates to get started on making your very own org chart!

Free organizational chart template

If you have access to PowerPoint, you can download this PPT template. This will give you a good base for your org chart. Feel free to expand on it!

You’re ready to create an organizational chart!

Businesses thrive when transparency and accountability are available to all employees involved. By sharing the inner workings of individual branches and connections within a business, employees have a collective sense of who they report to, who they communicate with, and who oversees specific operations. Even if your company is considered to have a “small tree,” there are endless opportunities to showcase the ever-growing branches and leaves in an organizational chart.

Interested in learning about more charts for your organization? Check out these articles on Gantt charts and PERT charts .

Tricia is a former research analyst focusing on office and design software. Tricia started at G2 in October 2018 after spending nearly five years in the competitive intelligence industry, which led to extensive market research knowledge and experience. She is currently maintaining the integrity of her space by building out new categories and writing data-driven content. Her coverage areas include office and design. In her spare time, she enjoys reading, attending concerts, and gaming.

Recommended Articles

12 Tips for Staying Organized as a CEO

When I tell someone I’m a CEO and company founder of a time management app, they often wonder...

by John Rampton

The Difference Between Internal and External Communication (+Examples)

Businesses thrive on solid communication.

by Mary Clare Novak

Everything You’ll Need to Include in Your Nonprofit Bylaws

Are you required by law to have bylaws?

by Lauren Pope

Never miss a post.

Subscribe to keep your fingers on the tech pulse.

By submitting this form, you are agreeing to receive marketing communications from G2.

We use essential cookies to make Venngage work. By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts.

Manage Cookies

Cookies and similar technologies collect certain information about how you’re using our website. Some of them are essential, and without them you wouldn’t be able to use Venngage. But others are optional, and you get to choose whether we use them or not.

Strictly Necessary Cookies

These cookies are always on, as they’re essential for making Venngage work, and making it safe. Without these cookies, services you’ve asked for can’t be provided.

Show cookie providers

• Google Login

Functionality Cookies

These cookies help us provide enhanced functionality and personalisation, and remember your settings. They may be set by us or by third party providers.

Performance Cookies

These cookies help us analyze how many people are using Venngage, where they come from and how they're using it. If you opt out of these cookies, we can’t get feedback to make Venngage better for you and all our users.

• Google Analytics

Targeting Cookies

These cookies are set by our advertising partners to track your activity and show you relevant Venngage ads on other sites as you browse the internet.

• Google Tag Manager
• Infographics
• Daily Infographics
• Popular Templates
• Accessibility
• Graphic Design
• Graphs and Charts
• Data Visualization
• Human Resources
• Beginner Guides

Blog Beginner Guides How to Create a Small Business Organizational Chart

How to Create a Small Business Organizational Chart

Written by: Letícia Fonseca Jun 09, 2023

No matter the size of your business, whether you’re starting out or already established, creating an organizational chart for small business planning is a necessary exercise.

There are numerous reporting relationships to visualize, especially when you have more than one manager in your small business.

Making an organizational chart can feel challenging, but this guide will make it easier to design an organizational chart that reflects many types of corporate structure.

Or you can customize a Venngage organizational chart template to create a chart that reflects your management structure in just a few minutes.

Click to jump ahead:

What is an organizational chart?

• Organizational charts for small businesses examples

What is the purpose of organizational charts for a small business?

How to make an organizational chart for a small business, faqs about organizational charts.

An organizational chart, or an org chart, provides a visual representation of an organization’s internal structure. It outlines relationships between departments and employees, establishes the chain of command in an organization, and defines the role of each staff member.

You can see how this hierarchical organizational chart example structures the employees of a company.

The most common structure has small business owners, or the chief executive officer, listed on the top.

Other C-suite executives or the vice president are listed below them. Department managers and team leaders are below them, followed by employees.

An org chart helps you navigate your company and can be included in onboarding documents for new employees to familiarize themselves with the organizational structure.

You can make the organizational chart your own by adding your branding to the diagram.

Venngage’s  My Brand Kit  feature imports your brand identity from your website so you can apply it to your designs.

Organizational chart for small businesses examples

There are two basic types of organizational charts for a small business:

• flat organizational structure
• hierarchical organizational structures

Flat organizational structure

A flat org chart or horizontal organizational structure is composed of limited or no middle management between lower-level employees and upper management, like in this  organizational chart example .

This type of organizational chart is common for small businesses and startups in their initial years of operation.

As this structure does away with several levels of management, it enables employees to quickly and independently make choices.

The decision-making power for the business is shared among employees on the same level, and they are held accountable for their decisions.

Hierarchical Organizational Structure

A hierarchical structure or top-down chart is shaped like a pyramid.

It is a traditional reporting structure adopted by most companies.

Hierarchy charts look like this:

A single person or a group is seated at the top, followed by managers in the middle and the rank-and-file employees at the bottom.

The organizational chart is divided into different departments with each employee reporting directly to a supervisor. This is most commonly used by large organizations and government units.

Create the right type of organization chart for your business with Venngage’s real-time collaboration feature. With a  Venngage business account, you can add team members, and share comments and feedback simultaneously.

An organizational chart offers a number of advantages to small businesses. 

We share the biggest benefits of creating org charts below.

An organizational chart improves communication across teams

When a small business starts growing, people’s new job titles can become confusing.

When merging with larger organizations with several teams and departments, in this example, it becomes crucial that the structure is tracked.

Understanding the hierarchy in the workplace is essential, so you know who your immediate supervisor is and whom to approach in case some issues arise.

A matrix organizational chart makes it easier to see which employees are involved in a project, and who the project manager or executive is. This improves efficiency across the entire organization.

Organizational charts enable easy onboarding for new employees

For new hires to find their way around the office can be quite challenging.

But presenting your organizational structure, like the template below, will facilitate the  onboarding process  and orient the employee to the chain of command.

Organizational charts can also help guide new hires through the specific functions and work responsibilities of coworkers.

The diagram serves as a cheat sheet, showing them the person to whom they should go for what information.

Organizational charts boost employee productivity

A matrix organizational structure expedites processes in the workplace as it shows the roles and responsibilities of each employee.

This helps reduce the time spent looking for the right people for the right task.

This organizational chart template also includes assistant managers so employees don’t need to go to the top managers for simple problems.

Instead of wasting time searching for information that would otherwise be found in an org chart, the employee becomes productive and efficient.

The organizational chart also prevents overlapping and duplication of work as it identifies positions and tasks assigned to each individual.

These details in org charts also help forge relationships among other employees.

An organization chart facilitates business growth

Employers can also get a clear view of the organizational structure, like in the template below.

They will know where an employee is positioned and the tasks they undertake. This makes it easier for the employer to determine which part of their organization needs improvement.

By taking a step back, owners can see which department is in need of additional manpower and which is overstaffed.

An org chart helps executives organize their workforce and ensure that managers have enough workforce to achieve company goals and objectives.

Create your small business’ organizational chart by following these simple steps.

Step 1: Determine the structure you want your business to follow

The first thing to do when making an org chart is to determine the corporate structure it will follow.

Choose the one that best suits your business needs from the two types of organizational structure discussed above: the flat org structure or the hierarchical organizational chart.

Step 2: Choose an org chart software

Creating an org chart might come as a challenge to some. But there are numerous free or paid tools online that can help. One of the best solutions is Venngage’s organizational chart maker.

We have plenty of professional smart org chart templates that can be easily edited with just a few clicks. Our library of visuals includes 40,0000+ icons as well as over 4 million high-quality free stock images. 

Step 3: Fill out the organizational chart template with your information

With the necessary data you have compiled, you can start filling out the chart templates from Venngage’s online org chart maker.

Collaborate with your team in real-time with a  Venngage business account . And once you’re done, you can download the chart as a high-quality PNG or PDF.

How can you create a small business organizational chart with Venngage?

Sign up for a free Venngage account using your email, Google, or Facebook profile.

Choose one of Venngage’s wide array of organizational chart templates for small businesses. To add information, titles, and visuals to your org chart, use Venngage’s drag-and-drop smart editor.

Then customize your org chart easily. Add or remove nodes in your org chart by clicking on the ‘+’ or ‘-‘ buttons. When you change the text or images, the nodes automatically resize to fit the content. Then you can download your organizational chart as a PNG or PDF file. Or share your design directly with your team through a private link.

What is a good organizational structure?

An organizational structure is deemed good when it helps a business reach its objectives. It should also be designed to aid individual employees’ growth. Additionally, org charts should reduce conflicts between individuals and team members, and remove duplication and overlapping of work.

Make your org chart for your small business today

Streamlining communication and driving efficiency has never been easier than with the help of organizational charts. It is an effective management tool that can help improve team performance for planning purposes. Org charts also act as a visual personnel directory.

To help you organize your teams and ultimately lead them to success, use the organizational chart examples that we’ve shared in this post. These Venngage templates will help your company’s overall performance in the long run.

Discover popular designs

Infographic maker

Brochure maker

White paper online

Newsletter creator

Flyer maker

Timeline maker

Letterhead maker

Mind map maker

Ebook maker

What is an Organizational Chart?

Table of Contents

Organizational charts explained.

An organizational chart (or org chart) outlines how your company operates. It can be used to show the structure of a company, the relationships between departments, or the chain of command. Generate your own with our org chart maker , or read on to discover more about the various types and how they can be used.

What should an org chart include?

Org charts are also sometimes known as organogram charts (or organigrams). These corporate structure charts show people’s relationships inside of an organization. They’re similar to family trees or kinship diagrams but show working relationships rather than familial ones. In an org chart, the boxes represent employees. These boxes often include the following information:

• Names (and sometimes photos) • Contact information • Roles and job titles • Responsibilities • Professional relationships between individuals

Lines and arrows connect these boxes together, showing where individuals sit in the company hierarchy and how they relate to each other.

Types of organizational charts

Organizational charts come in different structures and formats. Here are some of the most common.

Functional top-down organizational chart

A functional top-down chart offers a hierarchical structure to your business. It starts with one team member at the top of the chart (usually the president or CEO) and feeds down to other employees based on their roles in the company. For example, underneath the CEO, you might have the head of sales, head of marketing, and head of product. Under each of these heads of department, they’ll have a team that reports to them. This format offers clarity to employees. They know what their role is, who they’re working with, and who they report to. The chart also provides a clear path for professional growth. One of the key challenges of this type of org chart is communication siloing . With each department responsible for its own work, cross-functional communication can often go amiss. To make sure this structure works efficiently, teams need to communicate effectively across the business (which is where using a collaborative platform like Miro can help).

Flat organizational chart

A flat org chart (or horizontal organizational chart) shows few or no levels of management. With this type of organizational structure, the company promotes widespread team member self-management and decision-making. This org chart encourages less supervision from management and more involvement from employees. It can be empowering for employees, but it is a tricky structure to scale as a business grows. Flat org charts are more common for smaller businesses that don’t require a clear chain of command. It’s not unusual for growing businesses to move from a flat org chart to a functional top-down chart as they develop different departments.

Divisional organizational chart

A divisional org chart is a top-level version of a hierarchical structure, allowing different areas of the business to control their own resources. Divisions can be split in a variety of ways. These include markets, products, and even geographic locations. Divisions can operate like their own mini business within the company. For example, they can have their own marketing, IT, and HR sales teams. This approach offers flexibility to respond to industry changes, encourages autonomy, and allows divisions to offer a customized approach for their consumers. These structures are best used by larger organizations with areas that work independently of each other. However, as with the functional top-down org chart, divisional structures can often be subject to siloing. Cross-functional communication can be difficult, which could lead to duplication and overuse of resources.

Matrix organizational chart

A matrix org chart is a grid that shows cross-functional teams. Because of this cross-functionality, team members work with colleagues from different departments and report to multiple managers. A matrix org chart is a more complex structure than a simple hierarchical chart, but it allows managers to easily pick people from different teams to work on specific projects. However, this can also cause some conflict regarding capacity and who’s available for certain projects.

What is the best organizational structure?

First, let’s clarify the difference between an organizational chart and an organizational structure. An org chart is based on people, while an org structure is based on functions. Org structures outline the responsibility, accountability, and authority for each role in the company. Unlike org charts, they don’t change often. They’re based on the overall function and vision of the business, so regular changes are rare. When it comes to finding the best org structure for your business, there are two main types to consider: mechanistic and organic. Mechanistic structures are hierarchical and top-down (like the functional top-down chart). Departments in a mechanistic structure will usually follow a clear set of rules, which includes clear responsibilities for the employees and fields of action. Organic structures represent a more collaborative, flexible system (like the flat chart). They have more cross-functional workings, a wider span of control, and more decentralization. The best org structure depends on how you want to work as a business. If you want flexibility and more autonomy for employees, an organic structure would be best. If you prefer clearly defined roles and responsibilities within a hierarchy, mechanistic structures are the better choice.

Uses of org charts

Here are some situations in which creating an org chart can be helpful for your business.

To identify the chain of command

Clearly outline where each team member sits in the company hierarchy. Everyone can see their location in the structure and who they report to.

Miro's fully customizable chain of command template is tailored specifically for this.

To outline cross-functional relationships

Clarify how different departments work together to streamline cross-functional collaboration.

To allocate resources

By having everything laid out in a visual manner, you can effectively allocate resources based on team structures and capabilities.

To restructure

Whether restructuring a project team or an entire business, org charts allow you to plan and map an entirely new business structure.

For growth planning

Use an org chart to plan new hires as the business grows. Clearly identify where you’ll need new employees and what their roles should be.

To support new employees

Org charts are helpful during the onboarding process. You can familiarize new employees with the company structure, who their colleagues are across different departments, and who they should report to.

What is the importance of an organizational chart?

There are many reasons why businesses use organizational charts. To understand their company hierarchy, to pinpoint areas of improvement, to offer clarity to employees, and to improve communication between departments are just a few examples. Let’s look at these benefits in more detail.

To understand your company hierarchy

Having a solid grasp of the hierarchy of your business is beneficial for everyone at the company. For leadership, it helps visualize how teams work together and where everyone sits in the company structure. For employees, it shows who they need to report to and how they fit into the bigger picture. Simply put, an org chart helps companies better understand how to communicate effectively and how to work together to achieve company goals.

To pinpoint areas of improvement

With an org chart, you can highlight inefficiencies in your company structure and identify how to make improvements. You’ll identify how your team works together and where the structure can be improved, and you’ll be able to make the necessary changes based on this information.

To provide clarity

An org chart clarifies everyone’s role in the company or project. Whether it’s hierarchical or horizontal, everyone knows how they fit into the bigger picture, who’s on their team, and who they can go to for advice and guidance.

To improve communication

Offer a better line of communication between team members by clearly mapping out formal relationships. This is particularly helpful for cross-functional teams, where individuals may not know exactly who to reach out to. With an org chart in place, it’s clear who team members can contact from other departments.

Are there any drawbacks to be aware of?

Although org charts provide clarity and structure to a business, there are some challenges you might face throughout the process.

They can quickly become outdated

With new hires, internal movers, and employee turnover, it’s inevitable that your org chart will change over time. This means they constantly need to remain up to date, which can be time-consuming. Fortunately, using Miro makes this process quick and easy. With our online charts, you can update your company information in a matter of clicks, and your changes will be instantly visible to the rest of the company.

They focus solely on professional relationships.

Org charts don’t show how individual team members work together or whether they have a good working relationship. They also don’t show management style, and they don’t map all the methods of communication. All of this information is important to the success of your business, so take this into account when creating your org chart.

They don’t always show the full picture

Org charts are a streamlined representation of your company, meaning they can only provide so much detail. As a result, they can paint a misleading picture of the importance or influence of people at your company. If you do require more insight, you could use an organigraph, which offers more detail.

How to make an organizational chart

Take a look at this step-by-step guide to creating a well-structured org chart for your business.

1. Define your scope

Start by confirming why you’re creating the chart in the first place. Will it be an internal document for employees to use to visualize the company structure? Is it for management to identify areas of improvement? Will you show it to investors and key stakeholders to show how you plan to grow the business? You need to know the purpose of your org chart to make sure that it includes the right information and that it’s structured the right way.

2. Gather relevant information

After clarifying the purpose of your org chart, it’s time to collect all the information you need. This includes identifying employees, their role in the company, and their responsibilities.

3. Pick your org chart format

Choose the org chart format that best suits your company structure. If you want a hierarchical structure, the functional top-down chart or divisional chart could be a good choice. For something with more flexibility and fewer hierarchical levels, consider the flat chart.

4. Choose the right platform

Creating an org chart can be a tedious process, particularly if you have a complex company structure. To make the process easier to manage, be sure to use platforms that offer the right features and structure for your business. Take Miro as an example. Our digital workspace has features that allow teams to create custom org charts. Add your own branding, share the board with members of your team, and upload your own files and images.

5. Input the information

With your platform in place and all the information ready to go, add all the employees to your board. Include as much or as little information as you think is necessary. For example, some teams prefer to add contact information and photos of employees, whereas others simply use their names and job titles. Choose what works best for you and your team — there’s no right or wrong, so long as you have their name and job title.

6. Group teams together

Start to add structure to your chart by grouping teams together. Exactly how to do this depends on the structure you’re using. Refer to our “types of organizational charts” section to learn how to organize your teams based on your chosen organizational chart.

7. Identify relationships and the chain of command

When teams are grouped and you have some structure in your org chart, it’s useful to identify relationships within teams. It’ll help everyone familiarize themselves with who’s on their team and how each person relates to one another in the overall hierarchy. It’s also a chance to pinpoint cross-functional relationships across departments and lateral relationships between management.

8. Share it with your team

When the chart is complete, share it with your team or any relevant stakeholders. If you want to collect feedback on the chart, Miro’s workspace allows users to add comments and suggestions directly to your workspace. That way, you can instantly see their feedback and make any necessary changes to the chart.

9. Keep it up to date

As mentioned, company structures aren’t set in stone. New people join, current employees move positions, and some inevitably leave. To keep your org chart useful and relevant, be sure to update it when changes happen. If you use an online org chart, you’ll be able to simply make changes virtually, and everyone will be able to access your amendments in real time.

Examples of organizational charts

Take a look at some organizational chart examples to give you some inspiration for your own org charts.

Business organizational chart

A business org chart outlines your company structure. It shows your reporting structure, how different departments relate to one another, and how corporate functions work inside your business. A business org chart is often used for companies that want to either restructure their business or wrap their heads around the existing structure. It’s also especially helpful for new employees, as it allows them to familiarize themselves with your company and see the bigger picture.

Create a business org chart →

Project organizational chart

A project org chart structures the personnel of an upcoming project. It allows project managers to see what each person’s role is, the hierarchy of everyone on the project team, and the chain of command. This chart is also a great tool for identifying project roadblocks — such as potential resource gaps — as it allows project managers to visualize any issues and make the necessary improvements.

Create a project org chart →

Organizational change map

An organizational change map is slightly different than a traditional org chart, but it’s a useful example nonetheless. It gives you an overview of the different activities you can take to reorganize your business. If you’re planning to restructure your business or project, this chart is a great way to cover all your bases. You can visualize scenarios, map different stakeholders, and plan exactly how you anticipate the new system will work. When the map is complete, you’ll have found your ideal route for organizational change.

Create an org change map →

Discover more

The Quick Guide to Making a Team Charter

What is a functional structure?

What is a matrix organization?

Organizational chart examples

Get on board in seconds

Join thousands of teams using Miro to do their best work yet.

Organizational charts explained: a beginner’s guide

Make your company’s org chart work as hard as you do

By the team at Slack February 19th, 2024

An organizational chart maps out a company’s workforce, including its team structure, workers’ reporting relationships and employees’ responsibilities.

Done well, an org chart can be a lot more than just a map. A good organizational chart (org chart) can streamline business processes and help employees excel in their roles. It can be a resource for support, collaboration and team building.

Read on to take an in-depth look at org charts and to learn how to make a successful one for your company.

What is an organizational chart?

You might hear organizational charts referred to as org charts, organograms, organigrams or hierarchy charts. They all essentially refer to the same thing: a visual representation of a company’s internal structure.

An org chart maps out the employees within an organization, grouping them by team and showing how employees relate to each other.

Org charts illustrate reporting relationships and chains of command to give a simple overview of a company’s organizational structure, its hierarchy and how each employee fits into the big picture.

What should an org chart include?

An org chart contains information on verticals, teams, reporting relationships and individual employees. For each employee, an organizational chart might show their:

• Contact information
• Responsibility

The chart may use lines, arrows and other symbols to illustrate professional relationships and hierarchy among individual members.

Why are org charts important?

An org chart gets new hires up to speed, keeps longtime employees informed and builds confidence among investors. Having an organizational chart is particularly handy for companies with remote workers because it maps out the whole distributed workforce, including each remote employee’s role and the overall chain of command.

Any employee should be able to turn to the chart to answer questions such as:

• Who’s on the leadership team?
• How do I fit into my company’s organizational structure?
• Who can answer my questions about (insert specific subject)?
• Who reports to whom?

Organizational charts should also tell employees how downsizing, promotions and other organizational changes might affect them. When it’s designed well, a chart can even communicate a company’s values and philosophies, such as its positions on inclusivity, collaboration and hierarchy.

Limitations of organizational charts

• Org charts can easily become outdated as companies restructure and employees shift roles
• Charts may only show formal reporting relationships, excluding the nuances of informal professional relationships within a company
• Updating an org chart can be laborious, complex and time consuming, depending on the tool used to create it
• Organizational charts may not clarify management styles, communication methods and how each manager interacts with their team

Types of organizational charts

We all know how powerful graphics can be. A picture is worth a thousand words, right? (Well— if you use the right picture.)

To get the most out of an org chart, you must first decide on its design and how to visually represent your company’s organizational structure.

Hierarchical/top-down

This type of org chart starts with one person—typically the company’s president or CEO—at the top. It then takes on a pyramid shape that represents the workforce hierarchy. The higher you’re represented on the pyramid, the higher you are in the hierarchy.

• Pros: This format offers clarity on the lines of authority and communication. Employees can easily understand their roles, teammates and reporting relationships. A hierarchical org chart also provides employees with a defined path for professional growth.
• Cons: This structure offers limited flexibility in terms of hierarchy and may create silos that could hinder cross-functional collaboration and innovation.

Divisional structure

This layout is similar to the hierarchical chart but breaks down a large company’s structure by product line, geographic location or another grouping method. Large companies with independent departments that control their own resources often use divisional structure charts.

• Pros: Divisional structure provides more flexibility to respond to market changes. It also gives more autonomy to each division within a large company.
• Cons: Like top-down org charts, divisional structure charts could lead to siloing, hinder cross-functional collaboration, and make it difficult to spot duplication or overuse of resources.

A matrix org chart uses a grid to show relationships among cross-functional teams. This layout illustrates how employees work with others from different departments and how they report to multiple supervisors. It gives managers visibility to select people from different departments to work on a project.

• Pros: This structure helps break down silos and foster cross-department collaboration.
• Cons: Reporting to more than one manager or business unit can create confusion or conflict among employees.

Flat/horizontal

A flat or horizontal organizational chart takes the focus away from employee hierarchy. All members have a similar amount of power, with fewer hierarchical levels in the company. This design is most common among small businesses with simple structures, where employees often have more responsibility, wear many hats and are more directly involved in decision-making.

• Pros: This approach encourages closer relationships between executives and employees and empowers all team members to take leadership and be decisive.
• Cons: Companies have limited potential to scale within this structure. As organizations grow, they often move to hierarchical or matrix org charts.

How to create an organizational chart

Let’s run through the step-by-step process of creating an org chart for your company.

Determine your company’s organizational structure

Clarify your organization’s structure before you begin building a chart. Lay out how your company’s departments relate to each other on a high level.

Identify roles and relationships

Understand your company’s chain of command. Identify each employee’s span of control, and outline each business unit’s specialization. Then, map out reporting relationships among all employees. You can gather this information by surveying team members or working with the HR department.

Choose the right organizational chart type

Now that you understand your company’s structure on both a high level and an individual employee level, it’s time to pick an org chart design.

Your chart should mirror the organization’s reporting relationships, reflect decision-making processes, and comply with the company’s size and growth plan.

Know your audience

Understanding the audience for an org chart can help you decide how much detail to include. For example, an org chart containing details on each individual in the company may be limited to internal use. A simplified, high-level version might be more suitable for external parties.

Best practices for designing org charts

Keep your org chart simple, uncluttered and easy to understand. Use shapes, colors and line styles to distinguish hierarchy, relationships and process flows.

Highlight key roles and functions to help readers quickly identify critical personnel and understand the company’s organizational structure. Regularly update the org chart as the team and structure evolve. An outdated chart could cause confusion and errors.

Best tools and software for creating org charts

Various tools and applications can help you build and maintain an org chart. Any tool you use should integrate with your company’s existing productivity platform to ensure that everyone has access to the org chart for efficient communication and collaboration.

• BambooHR works well for small businesses and HR departments
• ClickUp incorporates an org chart tool into its management platform
• Deel lets users apply filters to understand how teams work together and who can answer their questions
• Lucidchart offers intuitive features and is best for large organizations
• Slack Atlas uses profile pictures, location information and fun facts to build a well-rounded portrait of each member of a Slack workspace .

How to use an org chart

A good organizational chart promotes collaboration and makes it easy for colleagues to find and understand each other’s roles. You can use a well-made org chart to:

• Onboard new employees : Demonstrate employee responsibilities and reporting relationships to new hires
• Manage growth and change: Visualize how teams grow and interact to inform hiring decisions
• Improve clarity: Understand how employees fit and interact within their company’s organizational structure
• Enhance communication: Empower team members to ask questions and take initiative by providing a deep understanding of various roles and reporting relationships
• Facilitate resource allocation: Allocate resources based on team structure and capabilities
• Streamline processes: Identify redundancies and inefficiencies in the organizational structure

Maximizing the power of organizational charts with Slack

Organizational charts do more than map out a company’s workforce. They can provide powerful context to help employees collaborate and communicate effectively.

Providing context with Slack Atlas

Slack Atlas uses profile pictures, location information and fun facts to build a well-rounded portrait of each member of a Slack workspace . Employees can use Atlas to learn about a colleague before direct-messaging them on Slack . Informing employees about one another helps build strong professional relationships in remote workplaces , boosting both morale and productivity.

Integrating organizational charts in Slack

Atlas provides searchable profile information and a dynamic org chart to encourage connection and promote transparent collaboration in Slack. Employees can learn about their colleagues and their company’s organizational structure right in Slack, where they’re already working.

Tracking org chart changes and updates in Slack

Atlas syncs with HR tools to populate employee information via Slack’s SCIM API , ensuring that every profile stays accurate and up to date. Workspace administrators can make specific profile fields editable for employees to add their unique spin.

Org chart security in Slack

When you’re handling employee information, data security is a must. Atlas uses the same enterprise-grade security and identity-management capabilities central to the Slack platform, focusing on security governance and risk management. 

The power of an org chart at your fingertips

Slack Atlas is available in all markets and languages supported by Slack. You can access Slack Atlas on the Enterprise Grid plan at no additional cost. It’s also available as a paid add-on to the Business+ plan. Learn more and start using Atlas today .  

• Communication

Was this post useful?

Thanks so much for your feedback!

Thanks for your feedback.

Oops! We're having trouble. Please try again later!

Keep reading

A crash course on the art of external business communication.

Effective external communication strategies can go a long way for business success

Internal communication in business: barriers, benefits and strategies to consider

How cohesive internal communication strategies drive company success

The best collaboration tools for remote teams

Learn about the best tools and technologies for remote and hybrid teams using Slack.

10 tips for mastering time management at work

Time management at work is key to optimizing productivity

Try Slack with your team for free

What is an Organizational Chart

What do you want to do with organization charts, i want to create my own organization chart on lucidchart., i want to create an organization chart from a template that is already made..

An organizational chart shows the internal structure of an organization or company. The employees and positions are represented by boxes or other shapes, sometimes including photos, contact information, email and page links, icons and illustrations. Straight or elbowed lines link the levels together.  With our org chart software, this creates a clear visual depiction of the hierarchy and ranks of different people, jobs, and departments that make up the organization.

Organization Charts, Org Charts, Organograms, Organogram Charts

Organigrams, organigrammes, hierarchy charts.

8 minute read

Do you want to create your own organization chart? Try Lucidchart. It's fast, easy, and totally free.

In 1855, railway general superintendent Daniel McCallum (1815-1878) designed what is thought to be the first modern organizational chart. It was an illustrated diagram of the New York and Erie Railway. McCallum had it drawn up by draftsman and civil engineer George Holt Henshaw (1831-1891). McCallum, born in Scotland, also served as a Union major general in the Civil War. Henshaw, a Canadian, worked for waterworks and railway companies in Canada, the United States and Denmark.

The term “organizational chart” took another 50 to 60 years to come into common use. Consulting engineer Willard C. Brinton used the term in his 1914 textbook, Graphic Methods for Presenting Facts. He touted the value of the charts and said they should be more widely used. The charts were mainly used in engineering circles until the 1920s, when they began to find their way into the business world.

The lesser-known synonyms “Organigram” and “Organogram” came into use in the 1960s.

Organigraph

Types of organizational charts, hierarchical, matrix, hierarchical org chart, hierarchy chart, matrix org chart.

Flat Org Chart

Horizontal org chart, line relationships, chain of command, lateral relationships, solid lines, dotted lines, pros and cons of different organization types.

The types of organizations reflected in these chart types have advantages and disadvantages.  In a nutshell:

hierarchical, vertical, top-down organization

Matrixed organization, flat, horizontal structure, uses of org charts.

What is the best use for an organizational chart? No matter which layout you choose to use, Org Charts are useful for laying out relationships in your organization and ensuring that everyone knows how to communicate essential information.

You can use org charts for:

Organizational and supervisory communication

Restructuring, workforce planning, resource planning, getting more visual with organizational charts.

There are few rules with org charts, so any visual elements that help to communicate are fair game.

Using photos

Using different shapes and/or colors, using company logos or icons, using animations in powerpoint, using 3d shapes.

Limitations of org charts

They can quickly become out of date,, they show only formal relationships, they don’t reflect management style, organigraphs, the close relative of org charts, how to plan and draw a basic organizational chart / organogram, define your purpose and scope, gather the information, determine what platform you plan to use to build your chart, and how you plan to display it., plan for ongoing updates to the chart., more tips for organizational charts / organograms, try breaking down your org chart, the details of people or departments, you might use colors or shapes, use lucidchart's  org chart import  , how to make an org chart with lucidchart.

Want to create org charts that highlight your company’s culture? Choose a layout that works best for your structure, update a design with your company colors, and add employee photos to each role. You can even add links and videos to your document for some extra pizzazz. Try clicking on our  org chart templates and make it your own.

For a truly dynamic experience

Helpful resources.

• What is an org chart and how to create one
• How to make an org chart in Excel
• How to make an organizational chart
• How to make an org chart in Word

With drag-and-drop shapes, real-time collaboration and advanced sharing features, Lucidchart makes it easy to create your own org chart.

How to Create an Organizational Chart for Your Small Business

By Becky Simon | April 5, 2022

• Share on Facebook
• Share on LinkedIn

Link copied

Creating an organizational chart can help a small business organize and plan for growth. We’ve simplified the process with a step-by-step how-to guide, example org charts, and expert tips.

Included on this page, you’ll learn why your small business needs an organizational chart,  how to create a simple organizational chart from a template, and how company culture plays a part in the shape of your chart.

What Is a Small Business Organizational Chart?

A small business organizational chart is a structured visual display of the people who fill the roles in a company and their working relationship with one another. It is a straightforward graphic that shows who reports to whom.

Aseem Kishore, the CEO of Help Desk Geek , outlines some of the benefits of creating an organizational chart. “Organizational charts are gaining huge popularity — and rightly so, because they have many advantages. The most fundamental advantage of an organizational chart is the fact that the reporting line and chain of command become clear. [Organizational charts] also help in noting job vacancies and overall headcount.”

Members of the C-suite and directors typically create the organizational chart but lower-level managers should also provide input. To make a chart more visually appealing, consider consulting with a designer once you have finalized the basic structure of your chart. 

Visit our guide to learn more about organizational charts, including how to create one from scratch in Microsoft Excel .

Why a Small Business Needs an Organizational Chart

With an organizational chart, small businesses can more easily outline the roles and reporting structure of their employees. By outlining the organizational structure, companies can help provide a roadmap for growth, as well as improved visibility and communication.

Some of the biggest advantages of having an organizational chart for small businesses include the following:

• Improve Visibility: By making your business more transparent, you’ll increase trust and communication among employees and departments. An organizational chart can foster visibility by making reporting information available to all members of the organization. “For smaller businesses, the basic aim is to clarify each other's positions in order to avoid office politics,” says Kishore. He suggests creating a simple chart and sharing it with all employees.
• Reinforce Company Culture: Your organizational chart can help establish and provide insight into your company’s culture. A chart that outlines a long, tall hierarchical structure may represent a company that has a lot of room for advancement in set roles, while a short, wide structure may represent a company that encourages employees to try many things and be less specialized.

• Improve Onboarding: Having an organizational chart available for new hires can help them familiarize themselves with the people they will be working with.

• Encourage Accountability: An organizational chart lays out exactly who reports to whom and who is responsible for various people and projects. Having one can help ensure that managers are not overburdened and that no one gets lost in the shuffle. “For leadership, a well-designed organizational chart makes it easy to view headcount allocation per department, front versus back ratio, and other important metrics,” says Monteiro.

Types of Small Business Organizational Charts

There are many types of organizational charts, but most small businesses will choose one of three: flat, hierarchical, or matrix. We’ve outlined the distinctions among the display types below:

• Matrix: Matrix-style charts are most useful for companies that work on multiple projects at once, or with teams that are not always discrete from one another. The matrix style divides employees by department, but also by project, to visually display what everyone is working on at a given time. This chart will likely need to be updated more often than the others as projects reach completion and tasks change.

How to Create a Small Business Organizational Chart

Creating a small business organizational chart is a simple process. First, organize the names and titles of the people in your organization. Then, determine who reports to whom and create a chart. Add design elements to personalize your chart, then share it with your organization.

• Create Your Chart: Start at the top with your CEO and work down from there by adding the CEO’s direct reports, then their direct reports. It is generally easier to approach your chart row by row, adding all the employees in one tier across the company, before adding the employees that report to each of them. Keep it simple at this stage, and stick to names and titles. Don’t worry about adding visual flair at this point — just ensure that your data is accurate.
• Proofread and Make Changes: Share your draft chart with others to verify its accuracy and make any needed changes. Compare your chart against your employee roster to ensure that titles are up to date and that all names are spelled correctly.
• Add Design Elements: Add employee headshots and company branding, and change the colors of departments or tiers. Standardize your spacing and shapes. A basic chart requires very little design, but if you plan to share your organizational chart widely, you may consider consulting with a designer for this step. For design inspiration, check out our roundup of free organizational chart templates for Microsoft Word .
• Share and Store: Share your completed organizational chart with your employees, and store it in an easily accessible place. Update your organizational chart on a regular basis to maintain accuracy.

How to Make a Simple Organizational Chart for a Small Business Using a Template

You can create an organizational chart very simply, using our downloadable Excel templates . Use the templates as a simple, pre-made base that you can add to and customize to suit your organization. 

We’ll walk you through step by step on how to create an organizational chart from a template below.

1. Download Your Organizational Chart Template

Download Hierarchical Organizational Chart Template — Microsoft Excel

This template provides a simple base hierarchy that you can build upon to create your own organizational chart. Copy and paste the name bubbles, connecting lines, and photo placeholders to create your layout, and then add photos and customize the look. Hierarchical organizational charts are widely used by small businesses and are the easiest to revise and build on as your business grows.

Once you have downloaded your template, open it in Microsoft Excel.

Pro Tip: Make sure to click Enable Editing at the top of the spreadsheet. Doing so will allow you to make changes to the document.

2. Enter Your Company Information

• Click on the Company field and enter the name of your company. 
• In the Compiled By field, enter your name. 
• Enter the date in the Date Completed field.

3. Draft Your Layout

Determine how many employees you need to include and where they fall within your chart. Start at the top and determine how many employees are at each level; then, complete each successive level. Make a list of names and who they report to.

Pro Tip: Sketch your layout on a piece of paper to use for reference when creating your chart in the template.

4. Add Employee Entries to the Chart as Needed

• Click and drag the newly pasted icon to the exact spot you would like to place it. Repeat the copy-and-paste process on the image placeholder icon.

5. Enter Your Employee Information

• Click on the top-most bubble (which is colored blue-gray by default) in the template and enter the name of the highest-ranking employee in your company, as well as their title. 

6. Review and Revise

Send your first draft to colleagues to review, and make any needed changes. Verify that names and titles are spelled correctly and that lines of report are correct.

7. Add Employee Photos

Once your layout is complete and the employee information has been entered into your chart, change the placeholder images to pictures of your employees. 

• Repeat these steps for every employee on your chart.

8. Customize Your Chart

• To customize the look of your chart, click on an icon in your chart. 
• With an icon selected, click on the Shape Format tab .

From this tab, you can change the shapes and colors of your employee entries.

Pro Tip: You can also access these tools by right-clicking an icon and clicking Format Shape from the drop-down menu.

• To change the shape of an icon, locate the Insert Shape tab, click Edit Shape , then highlight Change Shape . 
• Choose from a variety of shapes in the following drop-down menu.

• To change the color scheme of an icon, locate the Shape Styles tab. 
• Change the background color of a shape by selecting a color from the Shape Fill drop-down menu, or change the color of an outline by clicking Shape Outline . 
• You can add various edge effects to a shape from the Shape Effects menu, or select a pre-made theme by browsing with the arrow buttons. 

Pro Tip: Maintain visual cohesion by ensuring that employee icons on the same level are the same color and shape as one another.

9. Save and Share Your Chart

Save your organizational chart in an accessible drive, and share it with your team. Revisit and revise your chart on a regular basis to ensure that it is accurate and up to date.

Small Business Org Chart Sample Template

Download Hierarchical Organizational Chart Template Example — Microsoft Excel

This template is an example of a simple organizational chart for a small business. It is prefilled with the names and job titles of three tiers of employee hierarchy but can be easily customized to suit your needs. Add or subtract employees, change the reporting lines, and enter job titles to create an organizational chart for your own small business.

Tips for Creating an Organizational Chart for a Small Business

An organizational chart for a small business can take many forms. We’ve rounded up some tips, from incorporating headshots and other design elements to considering multiple versions of a chart, and expanded on them below:

• Use Employee Headshots: If you are using your organizational chart to aid in onboarding new employees, including headshots is a great way to help familiarize them with the people they will be working with. It is unlikely they will be able to meet everyone on their first day, and it can be very helpful to put a face to a name.
• Use Cohesive Design Elements: An organizational chart can be as simple as titles connected by lines, but paying attention to spacing and adding cohesive color and shapes can both make a chart easier to read and more memorable. Consider using a template or working with a designer to create a chart that is easy to parse and nice to look at.
• Use Available Software: An organizational chart is easy to make in Microsoft Word , Microsoft Excel, or Google Sheets. You can also use flowchart creators like Lucidchart to make simple charts, as well as more powerful image creation and editing tools like Adobe Photoshop to make more complicated graphics. All of these tools offer their own advantages, so use the ones you are most familiar with for best results.
• Create an Initial Chart Without Names: When creating an organizational chart for your company for the first time, consider leaving out names. Start by listing out all of the roles and responsibilities that are needed to do business. When you add names, it will be easier to see the gaps and easier to plan to fill them. “By removing names from the equation, we can concentrate on structuring our organization rather than particular people,” explains Reid.
• Multiple Versions: You may find it useful to create different versions of your chart for different use cases. A chart for onboarding new hires may have photos, for example, where an internal reference chart for C-levels may not need them. “You might also consider a chart with current positions and one with open positions, as both will function as a tool for decision-making and growth,” suggests Monteiro.
• Keep Things Concise: In general, keep your chart as simple as is needed. As your business grows and your chart expands, you might consider displaying whole teams as a single entry on your chart, rather than listing the names of everyone on those teams. “My organizational chart is in the form of a single-page PDF file. I believe having multiple pages makes it more complicated, so I always aim to fit everything on one page. When modifications are needed, I make them on a separate file and convert it into a new PDF to retain records over time,” says Anevski.

What Is the Best Organizational Structure for a Small Business?

The best organizational structure for a small business is typically a hierarchical form that reflects the needs and current reality of the company. Organizational structures vary widely based on the company size, the industry, and the changing nature of projects.

Smaller businesses have fewer employees, which can mean that people fill multiple roles. If you find that your employees wear many hats without rigidly defined roles, you might try a flatter structure. If your positions and roles are well-defined and unchanging, a traditional top-down hierarchy may be best. 

If your company works on multiple projects at the same time, with multiple teams, a matrix might be best to display that reality. Some small businesses may find that the top of their hierarchy remains unchanging while their teams change based on the project. A project-based structure can provide some flexibility for small businesses that may have less specialized teams. “A project-based structure has worked best for our small business. Our industry culture supports this structure as most of us operate using smaller workflows. The project-based system helps add to the resource pool and makes it more diverse. It also helps in allocating resources and finishing deadlines with increased clarity,” says Gamez. 

The shape of your structure may grow wider or longer, depending on how many rungs of accountability your business has and how often they work together. “My small business has always used a functional organizational structure, but no matter what you do, employees should be organized according to their skillset and corresponding function in the company,” suggests Anevski.

The Role a Work Culture Plays in Creating an Organizational Chart for a Small Business

Your chart can reinforce and reflect your culture in many ways. A smaller business should try to encourage interdepartmental cooperation and problem-solving rather than strict role-based work because this can promote better visibility, increased accountability, and better company-wide problem-solving.

“Culture has a profound effect on organizational structure. If a company's culture is open and very lean, that would reflect in its structure, which would not be very tall, rather wide — with cross-functional teams included. However, if the company has longer reporting lines, the structure will be longer as well,” explains Kishore. A company that is stricter in its approach to roles and rigidity will produce a taller, narrower chart. Either way, a chart that reflects the reality of the company will result in better trust and cooperation between employees who know what they are responsible for and whom they report to.

“My company culture focuses on teamwork,” says Anevski. “With the functional structure, each separate department is managed independently, helping different teams feel self-determined. The structure also allows employees to focus on their specific roles while encouraging growth and specialization.” 

Meanwhile, Reid his experience working in the culture of a taller chart. “We utilize the standard hierarchical model for our organization. The culture helps shape the structure by enforcing some measures. For example, government regulations require us to have specific procedures to be compliant. This compliance model requires structural changes to be incorporated. The structural requirements for incorporating formal communication differ from more informal communication,” he says.

Examples of Small Business Organization Charts

An organizational chart can take many forms, especially for small businesses. We’ve provided some examples of the kinds of charts you might expect to find in different small business situations below.

• Tech Startup: This organizational chart represents a very small tech startup with a very small staff. Most employees report directly to the CEO, who takes care of most unlisted tasks and oversees the general management of the company. It is likely that every employee on this chart is regularly delegated tasks outside of their strict job description.

​​What to Do After You Create a Small Business Organizational Chart

Once your organizational chart has been created, don’t let it languish. Revisit and revise your chart regularly, utilize it when onboarding employees or introducing your business to people, and share it with employees so that they can stay informed.

• Regularly Revisit and Revise: As your business grows, it is important to revise your organizational chart to reflect those changes. Set a schedule to revisit your chart a few times a year and make updates as needed. “As a business owner, you should expect that your small business won’t stay small forever. As it grows and hires more employees, your organizational chart will need to be modified. Always be prepared to add more people to your chart. For any small business, the chart will start out small and grow over time,” says Anevski.
• Utilize It Often: Consult your chart when considering hiring new employees or creating new teams. Your organizational chart can be a great tool to introduce your business to new employees and clients, as well as identify gaps in your command chain.
• Make It Available to Employees: When your chart is available to employees, you make it easier for them to contact the right people and answer questions. “We give the organizational chart to each of our employees. If someone ever needs information, they can follow the chain of command or go directly to the appropriate department, ” explains Reid.
• Plan Individual Employee Growth: Your organizational chart can be a great tool to track and plot employee growth. “We use it to assist organizations in preparing their career proposition for employees, developing their job architecture, and workforce planning. It is a powerful tool for HR to partner with the company leadership,” Monteiro shares.
• Create and Change Teams: Your organizational chart can help put together teams for new projects. Use it to see what people have done in the past and where they might be needed for future projects. “We use our organizational chart to delegate resources based on the nature of the project, skills required, and deadline dates. Since all resources are plotted as project-based, if the same skills are needed, a project shares and swaps resources. It has helped us become more agile and dynamic with our decision-making capabilities,” says Gamez.

Optimize Your Organizational Chart for a Small Business with Smartsheet

Empower your people to go above and beyond with a flexible platform designed to match the needs of your team — and adapt as those needs change. 

The Smartsheet platform makes it easy to plan, capture, manage, and report on work from anywhere, helping your team be more effective and get more done. Report on key metrics and get real-time visibility into work as it happens with roll-up reports, dashboards, and automated workflows built to keep your team connected and informed. 

When teams have clarity into the work getting done, there’s no telling how much more they can accomplish in the same amount of time.  Try Smartsheet for free, today.

Discover why over 90% of Fortune 100 companies trust Smartsheet to get work done.

• Automotive Services
• Home Services
• Pet Services
• Dental Practices
• Listings Management
• Social Media Manager
• Social Media Pro
• AudioEye ADA Compliance
• 800-693-1089

Related Articles

• Online review and team management for lawn care professionals
• Client and employee management software for electricians
• Online review and team management for plumbing businesses
• Online client and team management for auto repair shops
• Building an email list for home builders, remodelers and contractors

Small business organizational charts

A small business organizational chart is a visual representation of your business structure. It outlines employee roles and demonstrates who employees report to within the company. There are multiple types to choose from and many reasons why you should create one for your business!

Before getting started, it’s critical to establish goals for your organization chart (also known as an org chart) to help you decide which type to use and what information to include.

Does my small business need an organization chart?

You know who everyone is in the business, what they’re supposed to be doing, and the appropriate chain of command, so why would you spend time creating a chart that details all that information? There are several reasons such a chart can be a powerful tool for your company. Here’s how:

• Clearly defines management structure, which is helpful in a complex business
• Helps increase operating efficiency
• Shows current success
• Facilitates planning for the future
• Allows for at-a-glance engagement with the right contacts

Types of organization charts

Understanding the types of org charts available allows you to choose the one that makes the most sense for your business.

Line organizational structure

Also known as a hierarchical organizational chart or a top-down organizational chart, this is the most common structure due to its simplicity. The top of the chart features the executives, then directors (for larger businesses) followed by the department heads, and the employees each department head or manager is responsible for. This traditional hierarchy is simple and rigid. Information flows through each layer of the organization in turn, and the structure doesn’t allow for collaboration between teams or “open door” access to upper management.

For small businesses with few employees, this type of chart is the least complicated, with the owner at the top, shift or department managers in the middle, and other employees under them.

Functional organization structure

Similar to the line organizational structure, the functional organization structure offers more lines of communication. It enables directors and managers to collaborate with one another over teams they don’t directly control, for better information flow and flexibility.

In a small business, you’re likely to have separate teams with a great deal of interaction; the sales department  may have daily interaction with administration and with shipping. This type of chart establishes a hierarchy in each department while allowing for cross-communication.

Line and staff organization structure

This organizational structure is best for companies working in specialist fields. The staff in this situation refers to experts advisors providing technical information, opinions, and advice, who may be allowed to authorize certain activities and assist with reports that bear weight in decision-making. Staff and line positions have different objectives and are often at odds. Conflicting expectations can be confusing for bottom-tier workers and result in lower productivity.

Project-based structure

If your business operates with projects that are different from one client to the next , and from one brief to the next, this structure is the ideal choice. The chart changes as needed for each project. While it’s helpful to be able to mix and match personnel based on project needs, it does mean teams have to adapt to new managers and colleagues for each assignment. Managers must be able to handle a variety of functions across multiple departments.

At the top, you have a director who appoints the project manager for each project. The project manager chooses a team of people to work on the project based on their skills and expertise. When the project is complete, managers and team members are assigned to other projects.

For a small business, projects may internal, for example marketing campaigns or charity events. Project charts can help track teams for each initiative.

Matrix structure

The matrix organizational structure combines several types of organizational structures to create a customized solution to meet specific needs. A matrix organization is characterized by more than one chain of command, with project team members reporting to two or more managers. It’s ideal for businesses that are project-based, where teams must also follow a functional structure.

In this case, team leaders are assigned a representative from each functional area that applies to the project. The functional team member reports to the project manager and the functional manager of that area.

The functional manager oversees the employees and activities to ensure they’re in line with company standards and policies, while the project manager or team leader ensures the project is completed as planned. As with a line and staff structure, conflicts and confusion can arise when reporting to more than one boss.

Circular structure

In a circular structure, there is still a reliance on hierarchy. Higher level employees occupy the inner rings of the circle and lower level employees occupy the outer rings. The executives aren’t at the top of the structure, but rather on the inside to allow ideas to spread outward. The structure is intended to promote open communication and the free flow of information between all parts of the organization.

In practice, the structure is often confusing because it can be difficult for people to figure out where they fit within the organization and who they are supposed to report to. However, in a business where communication is encouraged on all levels, this allows employees to seek advice from any available supervisor, as opposed to a rigid chain of communications.

How to create a small business organizational chart

First, choose the type of chart that best suits your company’s needs. To prepare for the chart creation process, make sure you have a list of all employees available with any pertinent information, such as supervisory relationships. Gathering this information ahead of time will speed the process of filling in the chart.

With the type of chart in mind, choose the tool you’ll use to build the organizational chart. While there’s always the option of hand-diagramming your chart, this time-consuming process isn’t conducive to making quick and easy changes as your organization grows or people leave. If you prefer this option, there are plenty of organizational chart templates  available for download.

You can use a number of free tools such as Microsoft Office or Microsoft Excel to create your chart. There’s also the option to use drawing and presentation programs such as Google Slides or Microsoft Powerpoint.

You can also use org chart software such as Pingboard  to create your chart. Though it is a paid tool,  there is a free version comes with limited functionality that you can use to get started. Some HR and payroll systems, including Success Factors , Zenefits , and Justworks  offer the ability to generate organizational charts using the current employee data in your system.

Ideally, you’ll want something that offers the ability to color code your chart, search by name or job title, and drill down to locate more detailed employee information so that it is easier to interpret, use, and update.

With all the information assembled, fill in the information to complete the chart. You’ll want to at least include the name of the person in the position – leaving it blank if the position is open, along with the department, the role or job title. If there’s enough space, you can also include the location, which is particularly helpful when working with a geographically diverse or remote team. It’s also a good idea to include a photo of the person along with contact information.

Some organizational chart software solutions offer additional functionality so that your chart can also function as an employee directory on  your business website . Those options allow you to enter details that are only visible to the employee and upper management, such as emergency contacts, t-shirt size, and dietary restrictions, which can be useful for company functions and rewards.

For your small business organization chart to ultimately serve its purpose and aid your business, you must be able to update your chart as needed and effectively share each version of the chart with your entire team. Access to an organizational chart facilitates daily communication among staff members and employee efficiency, contributing to smoother business operations, so it’s well worth investing resources into the process. It’s a good idea for small business owners to operate with two versions of their chart; one forward-facing for all employees to see, and one behind the scenes to plan for future growth and vacant positions.

Watch your online reputation transform with Broadly

Get more out of broadly., local seo optimization: complete guide, top local seo tools for home service business owners, essential small business seo tips, powerful home services lead generation strategies, how to trademark your business name: a step-by-step guide for entrepreneurs, master your online business reputation: essential strategies, maximizing your visibility on angie’s list business center, how to master local business marketing: a comprehensive guide for service providers, ultimate guide to plumbing lead generation: strategies to boost your business, examples of dealing with difficult or angry customers professionally.

Organizational Structure

What Is an Organizational Chart?

Last updated: May 11, 2023

Table of contents

What is an organizational chart?

Different org charts, hierarchical org chart, functional org chart, matrix org chart, divisional organizational structure, flat org chart, the benefits of having an org chart, how do i make an org chart, collect the information you need.

An org chart does more than organize your team’s roles & relationships. Learn about the types of org charts, what they’re used for, and how to create your own.

An organizational chart is an important tool for every company — no matter the size. Having a clearly defined org chart can improve communication, increase your chances of turning candidates into colleagues, and convey transparency to the world around you.

An org chart can also be helpful in identifying issues, prioritizing resources, and making the right decisions. But what is an organizational chart, what are its benefits, and how do you create one? In this article, we’ll answer all of those questions.

Let’s dive into it!

An organizational chart is a visual representation of how your organization is structured. Company organizational charts show the reporting relationships between employees, managers, and executives within teams, departments, or divisions.

Companies can be structured in many different ways, so there are several different types of organizational charts. Some are divided by skill and designed with centralized control for making the best decisions, while others encourage collaboration and distribute autonomy to enable faster decisions. Let’s take a closer look at different types of organizational charts.

A hierarchical organizational chart is the most common and traditional way of structuring a company. A hierarchical organization is pyramid-shaped with the CEO at the top. The higher up on the chart, the more decision-making power.

Hierarchical org charts have a clear chain of command, as every employee reports to their functional manager above them in the hierarchy. Communication flows from the top down.

This type of organizational structure is found in companies such as Amazon, Walmart, and Coca-Cola where a clear chain of command is necessary for making the right decisions. Contrarily, this structure is rarely seen in startups. Startups will often implement a flatter structure to move faster and avoid the bureaucracy that can arise in the layers of middle-management.

In a company that operates under a functional organizational chart, employees work in different departments, each having a functional head. Unlike a hierarchical chart, employees are organized by their expertise rather than by decision-making authority.

As each employee is not individually managed, functional organizational designs allow for more flexibility and autonomy within each department, while still keeping a short chain of command to the head of each department.

A matrix organizational chart is defined by employees reporting to both their functional manager above them in the hierarchy _and _a cross-functional manager at a horizontal level in the organization. The functional manager oversees the employee generally, while the cross-functional manager supervises the employee on specific projects.

Matrix-style structures enable collaboration horizontally across different departments and teams while also keeping a clear chain of command vertically in the organization. Matrix org charts are adopted by companies such as Google, Microsoft, and Apple.

In a divisional organizational structure , the company is divided into different divisions. Departments each have their own focus, such as a specific product, market, or geographical location.

Divisional org structures are like small companies within a big company. Each division is responsible for its own operations, thus having its own marketing, sales, finance, and other departments. Employees report to the head of the division that reports to the executives.

This model enables flexibility and adaptability to market changes. However, it can also have downsides. It can require more effort in maintaining clear internal communication and lead to inefficiency due to duplicated efforts in different divisions.

Flat organizational charts are often found in startups. This type of company org chart aims to limit bureaucracy by removing the layers found in a hierarchy chart. This allows for a short chain of command from staff to decision-makers.

An example of a company that has delayered — i.e. flattened their organization — is Valve. The video game company used to operate with a traditional hierarchy, but the founder, Gabe Newell, found this structure to hinder innovation and implemented a flat structure to increase employee autonomy.

Let’s go over a few of the other benefits of creating an organizational chart for your company:

• Creating an org chart can help you get your priorities straight

As we have learned, different organizational charts have different goals. In trying to achieve these goals, the company is structured to prioritize a certain outcome and will often have to compromise on other areas.

A hierarchical org chart , for example, prioritizes a clear chain of command and centralized control at the top of the pyramid. This will often result in thought-out decisions that have been refined through the layers but it comes with the price of slower decision-making processes.

On the contrary, **a flat company organizational chart **distributes decision-making by giving more autonomy to each employee to make decisions faster. It is often found in startups that are willing to compromise on the quality of the decision to move faster and with more flexibility.

To create an org chart, you’ll need to settle on an organizational structure. This process will force you to define your priorities, make compromises, and maybe rethink your entire organizational design to foster innovation by delayering or by adding more management to increase control.

• Use the org chart to improve your company

Once you have created an org chart, you have a complete overview of your organization. This will make it easier to not only identify challenges but also provide solutions.

Say your engineering department isn’t meeting deadlines. Using your org chart, you can pinpoint exactly where the problem arises.

You may discover that there’s miscommunication between employees and a manager, which means that you need to change the reporting structure or make efforts to improve communication. Or maybe you find out that the engineering team is understaffed. Your org chart can then be helpful in identifying exactly where a project manager is needed so you can allocate resources to solve the issue.

• Show the world who you are

Startups are constantly competing to hire the best talent. With the same old recruiting emails, you’re going to get the same old results. More than 400,000 companies have their org chart publicly available on The Org . The platform helps companies turn candidates into colleagues and has a 40% higher response rate from candidates than traditional recruitment outreach.

Showcasing your team is great for hiring purposes as talent can clearly see how they fit into your org. At the same time, it’s valuable to potential and existing customers, who can easily find the person within your organization relevant to their inquiry.

Furthermore, there’s a symbolic byproduct of having a publicly available organizational chart: by clearly showing how your company is structured, you convey organizational transparency which can increase trust in your company.

An org chart is a helpful way for potential customers and candidates as well as internal executives, managers, and employees to learn about your company. However, choosing the right structure for your company requires some effort.

Follow these steps to create your own org chart:

• Choose the right organizational structure

To start, you need to find the right fit for you among the different types of organizational charts.

Startups will often choose an org chart that prioritizes fast decision-making, cross-collaboration, and fewer expenses for managers. This is often a flat organizational structure.

Middle-sized or innovative, large companies are often seen employing a matrix-style organizational structure that allows for collaboration but also prioritizes a high level of management.

Larger, traditional companies will be more inclined to operate under hierarchies. This organizational structure prioritizes a clear chain of command, department-based collaboration, and multiple layers of management.

Tip: Not sure which structure fits you? Check out our article: “Which Organizational Structure Fits You? Pros and Cons of Different Types of Organizational Structures”

In order to create an organizational chart of a company, you’ll need the following information:

• **Your organizational structure. **Flat, functional, hierarchical, matrixed, or divisional?
• **Names & job titles. Collect the **names, titles, and preferably pictures of every employee within the organization.
• **Departments. **Which departments make up your company? Outline it and add employees to the individual departments, teams, or divisions.
• Reporting relationships. Who reports to whom? This information will be central in the organizational chart as it shows the connections between employees, teams, and decision-makers.

When you have collected the data and completed the steps, head over to The Org. Here , you’ll be guided to finalize and publish your org chart for the world to see.

The ORG helps you hire great candidates

Free to use – try today

Which Org Structure Fits You?

Matrix organizational structure, flat organizational structure, functional organizational structure.

How to Write a Business Plan: Organization Structure

How to write a business plan: organizational structure, what is the organizational structure for a business plan.

The organization structure section should discuss whether your business will be a sole proprietor, limited liability corporation, or corporation, who will run your business, each person’s responsibility, and how your business will expand if needed.  There are numerous benefits to a detailed assessment of the company’s structure.  First, examining the structure of the business will help for tax purposes.  For example, limited liability and corporations are considered excellent for protecting shareholders concerning liabilities.  However, tax-wise, these firms often are double taxed.  The second benefit of a detailed assessment of a company’s structure is to understand how each owner will contribute to the company.  In other words, if there is more than one owner, what are their responsibilities, and how are these responsibilities to be carried out.

Why is the Organizational Structure important? 

There are numerous reasons why the organizational structure is essential for a business plan. In this section, the business owner will lay out how the company will be structured.  For example, this section will include job titles and responsibilities, resumes from owners and management, showing expertise in the industry, and supporting accolades for expertise.  Through discussing job responsibilities and experiences for management, readers will better understand why this type of business structure, and this management team, will be successful in the proposed business.

A second important reason for the organizational structure is that the section introduces business owners.  The owners and management team should not only be introduced in this section, but their experiences in the industry need to be highlighted and thoroughly explained.  In doing this, a sound foundation for management competence will be established.

A final reason for its importance is the job responsibility segment.  Ownership and management need to have a written document showing specific duties for each owner, if applicable, and specific job responsibilities for each position within the company.  By having this document, readers will see how the business will function and better understand the breakup of management responsibilities.

When to write the Organizational Structure?

The organizational structure should be written after the company description.   In the company description, readers will be introduced to the problem that the company is going to solve and how they propose to solve this problem.  This is usually the product or service offered.  The logical next step is to show a business structure that will allow the company to supply that product or service effectively and efficiently.  Thus the need for the organizational section follows immediately behind the company description.

How to write the Organizational Structure?

When I write my organizational structure for a business plan, for the most part, I start the first paragraph by reminding the readers of the company name.  From this, I then introduce how the company will be held in ownership.  For example, will the company be a limited liability corporation?  Sole proprietorship?  Next, I briefly introduce the management team and owners.  Further, I also briefly introduce their experience in the industry.

By following this structure, the first paragraph is an excellent summation of the section. This allows the reader to understand the breadth of the ownership structure without gaining significant details.

Organizational Structure:  Ownership

In the ownership section, I usually start writing the section by introducing the CEO/founder/majority owner.  In this portion, I usually write the segment, almost like a brief biography.  I will discuss the CEO's history in the industry and the reason why they feel that they are best suited to start and run the operation.

Once this is complete, I then follow the same structure with the other management team members and minority stakeholders.  When this is done, the reader should walk away with an excellent understanding of the qualifications of the ownership team and how their skills will complement each other.

Need Help Writing an Organizational Structure for a Business Plan?

Call or Text Paul, Doctoral Candidate, MBA.

321-948-9588

Email: [email protected]

Organizational Structure:  Responsibilities

In the job responsibility section, I usually structure this portion as a bullet-pointed list.  At the top, I put the title such as CEO, project manager, or job title.  Following this, I list the responsibilities and expectations for each position.  Not only does this help show structure and foresight for the company.  But also, this will help management divvy up duties for the business.

Organizational Structure: Resume

The resume section is for senior managers and owners.  By including resumes, supporting documentation is available for claims made related to experience.  For example, if the CEO claims to have 20 years of experience in the industry, then the resume will show where this experience came from.  This adds credibility to previous claims made.

Organizational Structure: Compensation

Compensation is sometimes necessary to include in the organizational structure component.  Investors expect management to be compensated and employees as well.  However, excessive compensation is often an issue with startups and established businesses.  By showing reasonable compensation for each position, not only will a solid understanding of the pay for each position be shown, but restraint for compensation by the management team and ownership may be highlighted as well.

Organizational Structure: Achievements

This final section is almost like a cherry on top of the cake.  By this point, the reader should be well-versed in the experience and expertise of ownership and the management team.  Adding achievements highlights their expertise in their chosen industry.

Organizational Structure Example

Organizational structure.

Legal Structure

ABC Restaurant will be a limited liability corporation.

Management Summary

John Smith, Sr., MBA., is the founder and CEO of ABC Restaurant.  He has started and managed numerous successful small restaurants over the last ten years.  Restaurants started, and managed, including a breakfast cafe, food truck, and 24-hour diner.  For each business, he was responsible for all aspects of the organization, from marketing to strategic planning.

Job Responsibilities

• Create and execute marketing strategies for business growth.
• Align business strategies with the vision statement.
• Negotiating contracts with vendors.
• Ensure legal compliance for the business.
• Continually examine the firm’s external environment for new market opportunities.

General Manager:

• Control inventory to ensure optimal levels are attained.
• Manage day-to-day operations of the restaurant.
• Servers and cooks during high volume times.
• Interview and hire new employees.
• Assist in the onboarding process for new employees.
• Set up all workstations in the kitchen
• Prepare ingredients to use in cooked and non-cooked foods.
• Check food while cooking for appropriate temperatures.
• Ensure great presentation by dressing dishes as trained.
• Keep a sanitized and clean environment in the kitchen area.
• Stock dining area tables with needed items.
• Greet customers when they enter.
• Present dinner menus and help customers with food/beverages selections.
• Take and serve orders quickly and accurately.

Author: Paul Borosky, MBA., Doctoral Candidate, Published Author

Updated: 3/4/2022

Business Plan Organization and Management: How to Write Guide .

Sep 17, 2023 | Business Consulting , Business Plan , Organization and Management , Organizational Development , Strategy

Writing the Business Plan Organization and Management Section

It provides critical information for those looking for evidence that your staff has the necessary experience, skills, and pedigree to realize the objectives detailed in the rest of your business plan.

What Is the Organization and Management Section in a Business Plan?

The organization and management section of your business plan should provide details about your business structure and team. This section typically comes after the executive summary. However, some people have it further in the document after the market analysis section.

This section generally is separated into two parts. The first concerns the organization as a whole. It gives readers an overview of the company structure, which is an excellent opportunity for the reader to lift the roof off your office and peer into its inner workings. For your legal design, you may set up as a limited liability company (LLC) or nonprofit/ charity or form a partnership. It’s crucial to include this section. However, suppose you’re starting a home business or have an already operating business where you’re the only person involved. In that case, you can skip this section or show the company registration details from either the company’s house or the awarding .gov.

The second part focuses specifically on your management team and introduces readers to each member — your chance to impress them with the many accomplishments pinned to your organization’s management team.

This section may seem less important than some of the other parts of your business plan, but the truth is that your people are your business. If they’re highly competent and accomplished, the implication is that so is your business.

Of course, if you’re a sole proprietor with no management structure or any employees, this section is unnecessary other than to talk about yourself and your achievements.

The section on organization and management should outline the hierarchy, individual roles, and corresponding responsibilities. It should also highlight each person’s strengths and qualifications for their positions.

Business Plan Organization Section

The organizational section of your business plan outlines the hierarchy of individuals involved in your business, typically in a chart format. This section identifies the President or CEO, CFO, Director of Marketing, and other roles for partnerships or multi-member LLCs. If you’re a single-person home business, this section is straightforward as you are the only person on the chart.

Although this section primarily focuses on owner members, you can include outsourced workers or virtual assistants if you plan to hire them. For example, you may have a freelance web admin, marketing assistant, or copywriter. You may even have a virtual assistant who coordinates with your other freelancers. While these individuals are not owners, they hold significant responsibilities in your business.

There are various business structures, such as sole proprietorships, partnerships, LLCs, and corporations.

Detail the Legal Structure within the Business Plan Organization and Management Section

Here is an indicative list of business structures. It would help if you talked to your accountant and legal advisors to determine which legal form is the best for your business proposition.

Sole Proprietorship

When embarking on a business venture, it’s essential to consider the various structures available. A sole proprietorship is a structure whereby the business is not regarded as separate from its owner’s finances. The owner retains complete control and responsibility for the company. However, they are unable to sell stocks or bring in new owners. The business becomes a sole proprietorship if not registered under any other structure.

Partnership

When forming a partnership, it can either be a limited partnership (LP) or a limited liability partnership (LLP). One partner assumes most liability in a limited partnership (LP). In contrast, the other partners have limited liability and control over the business. Alternatively, in a limited liability partnership (LLP), all partners have limited liability from debts and actions of other partners, and there is no general partner.

Limited Liability Company

A limited company (LTD) or limited liability company (LLC) is a mixture of business structures that mixes aspects of partnerships and corporations. It offers limited personal liability to the owner and passes profits through to their tax returns.

Corporation

There are various types of corporate structures. A C-corporation enables the issuance of stock shares, pays corporate taxes instead of personal returns, and provides the highest level of personal protection from business activities. On the other hand, nonprofit corporations are similar to C corporations. However, they do not aim to make profits and are exempt from state or federal income taxes.

More information on company legal structures is available on UK.Gov and USA.SBA websites.

Describe Your Company’s Organizational Structure

This first step illustrates the positions in your organization’s employee hierarchy and how they all relate to each other.

This is usually done graphically as a guide, using an organizational chart, or “org chart” for short. People use a Microsoft tool, i.e., PowerPoint or Excel, to help.

Organization Charts typically follow a top-down hierarchy, starting with your CEO/ Managing Director in the top box at the top of the page. Lines extend down from that person’s name to boxes containing the terms of the CEO’s direct reports.

We have included an example organizational chart below for guidelines only.

Identify your business organization structure and list your team members’ strengths and skills.

Those managers then have lines extending to those who report to them, and so on, down to your lowest staff positions.

This section will give your readers a quick understanding of your management and governance structure, the size of your organization, and your lines of control and communication.

Describe your Team in your Business Plan Organization and Management Section

In your business plan’s Organization and Management section, please provide a detailed description of your team. Y ou will discuss the company’s management team, starting with the owners.

This section highlights who is involved in the running of your business and who are the support professionals. It also includes the roles and responsibilities of managers.

Suppose the company structure is a multi-owner arrangement or some other multi-owner arrangement. In that case, you’ll want to include information for every member and their percentage of ownership and ongoing involvement in the company.

It’s important to discuss how ownership interests are split, their responsibilities, what they did before securing their current position, and how they came to be involved with the company.

Here, it would help if you talked about some of your critical team members. These people are directly responsible for large portions of your business operations.

Owner/Manager/Members

Within your business o rganization and management section, y ou should introduce the team and talk about their experience, qualifications, previous companies and achievements, role in the company, and any special skills they bring with them. Please provide the following details for each owner, manager, or member of the business within your business plan:

• Percentage of ownership (if applicable)
• Level of involvement (active or silent partner)
• Type of ownership (e.g., stock options, general partner)
• Position in the company (CEO, CFO, etc.)
• Responsibilities and Duties
• Educational background
• Relevant experience and skills
• Previous employment history
• Skills that will benefit the business
• Awards or recognition received
• Compensation structure
• How each individual’s skills and experience will complement and contribute to the business’s success

Perhaps they’re an entrepreneur, business coach, exclusive advisor, or industry specialist to help you grow.

This is an ideal opportunity for companies with an Executive Board of Directors, Governance Structure, or Advisory Board to introduce them to your readers.

Executive Board

Having a board of directors is essential for your management team. Without one, you may be missing out on crucial information. This section includes details similar to those found in the ownership and management team sub-section, such as the names, areas of expertise, positions (if applicable), and involvement with the company of each board member.

Strategic Advisors

Suppose you’re looking for funding for your business or to fill a gap in your knowledge, or you may not have the funds to hire an executive board. In that case, you must inform potential partners and investors that you have a team of professionals assisting you. This includes lawyers, accountants, and any freelancers or contractors you may be working with. When listing these individuals, include their name, title, educational background, certifications, services they provide to your business, and their relationship with you (i.e., hourly rates, projects, retainer, as-needed, regular). Additionally, highlight their skills and experience that make them an asset to your team you need

Does anything else make them stand out as quality professionals (awards, past working with credible brands)?

Spotlight on the Wider Team Structure

Now, you’ve showcased the management team in its entirety. You can provide brief bios for hiring team needs or secondary members and talk at length about how the team’s combined skills complement each other and how they amplify the team’s effectiveness.

It’s also important to point out any gaps in the knowledge your team is currently suffering. Your readers will likely be savvy enough to pick up on existing holes.

Therefore, you’ll want to get ahead of these criticisms and demonstrate that you’re already aware of the positions and complementary skill sets your management team still requires and how you plan to address the knowledge gaps with future hires.

Do you need help writing your business plan o rganization and management section ? 

Every successful business plan should include the organization and management section, helping you communicate your legal structure and team.

Writing a business plan can seem overwhelming, especially when starting a small, one-person business. However, it can be a reasonably simple task. This section of the plan should be updated if there are any changes to the organization structure or team members, such as additional training, awards, or other resume changes that benefit the business.

Creating your comprehensive business plan takes planning, research, time, and a herculean effort. If, at any point, the work becomes too much to handle, we can step in to assist.

Do you want an expert “second opinion” before creating your business plan or financial forecasts? Let’s talk !

Get in Touch

Are you looking to grow your business but unsure where to start? Our small business consulting and leadership coaching services are here to help! We’ll work with you to scale your operations and achieve your goals. Plus, we offer a free 30-minute consultation to ensure we fit your needs correctly. Let’s get started!

Contact Noirwolf Consulting today using the website contact form or by emailing [email protected] or call us at +44 113 328 0868.

Recent posts .

What is Program Management?

Apr 2, 2024

Program management is a vital component of organizational success, as it enables the coordinated execution of interdependent projects that yield benefits beyond the scope of individual project management. It involves the judicious application of knowledge, skills, tools, and techniques to meet specific program requirements. Our experience has demonstrated that organizations with well-developed program management and program management offices (PMOs) consistently outperform those that lack such structures. Therefore, it is imperative that organizations prioritize the establishment of robust program management frameworks to achieve their strategic objectives.

Business Transformation Strategy: A 10-Step Strategy Guide

Mar 4, 2024

Business transformation strategy is a complex and dynamic process that fundamentally restructures an organization’s strategy, processes, and systems. Though each business transformation is unique, several critical steps remain foundational to a successful change management plan. A comprehensive business transformation framework ensures a smooth and practical transformation. This framework should encompass various elements, such as defining the vision and aims of the transformation, assessing the current state of the business, identifying gaps and areas of improvement, developing a roadmap and action plan, implementing the changes, monitoring and measuring progress, and continuously refining the transformation approach as needed.

What is the Change Management Process?

Feb 2, 2024

Change is the only constant in today’s fast-paced world, and organizations must adapt to stay ahead. Fortunately, change management provides a structured and coordinated approach that enables businesses to move from their current state to a future desirable state. To deliver business value, organizations introduce change through projects, programs, and portfolios. However, introducing change is just the beginning! The real challenge is to embed the change and make it a new normal state for the organization. This calls for implementing the main principles of change management, which we will discuss in this article. Get ready to transform your organization and achieve your desired outcomes by mastering the art of change management!

Happy clients .

Trevor mcomber, us.

I recently worked with Zoe@Noirwolf, who provided me with an outstanding 5-year business plan. The expertise in financial planning, market research, SWOT analysis, and consulting was exceptional. Zoe provided me with a comprehensive and well-researched plan tailored to my business. The entire process was professional, timely, and communicative.

Bill Walton, Leeds

Zoe provided first-rate work and is an excellent business consultant. I was trying to figure out my cash flow forecast for my startup. Zoe gave me an interactive consultation session over MS teams, which was valuable and saved me a lot of time. She is super quick in excel and knowledgeable about what to include in your estimates. She was able to offer me ideas & choices that I hadn't considered. Highly recommended.

Jeendanie Lorthe, US

Warren kim, us, oscar sinclair, london, get in touch ..

Looking to grow your business but feeling unsure about where to start? Our small business consulting and leadership coaching services are here to help! We'll work with you to scale your operations and achieve your goals. Plus, we offer a free one-hour consultation to ensure we fit your needs correctly. Let's get started!

Business Plan Section 3: Organization and Management

This section explains how your business runs and who’s on your team. Learn how to present the information in this section of your business plan.

This section of your business plan, Organization and Management, is where you’ll explain exactly how you’re set up to make your ideas happen, plus you’ll introduce the players on your team.

As always, remember your audience. If this is a plan for your internal use, you can be a little more general than if you’ll be presenting it to a potential lender or investor. No matter what its purpose, you’ll want to break the organization and management section into two segments: one describing the way you’ve set up the company to run (its organizational structure), and the other introducing the people involved (its management).

Business Organization

Having a solid plan for how your business will run is a key component of its smooth and successful operation. Of course, you need to surround yourself with good people, but you have to set things up to enable them to work well with each other and on their own.

It’s important to define the positions in the company, which job is responsible for what, and to whom everyone will report. Over time, the structure may grow and change and you can certainly keep tweaking it as you go along, but you need to have an initial plan.

If you’re applying for funding to start a business or expand one, you may not even have employees to fit all the roles in the organization. However, you can still list them in your plan for how the company will ideally operate once you have the ability to do so.

Obviously, for small businesses, the organization will be far more streamlined and less complicated than it is for larger ones, but your business plan still needs to demonstrate an understanding of how you’ll handle the workflow. At the very least, you’ll need to touch on sales and marketing, administration, and the production and distribution of your product or the execution of your service.

For larger companies, an organizational plan with well-thought-out procedures is even more important. This is the best way to make sure you’re not wasting time duplicating efforts or dealing with internal confusion about responsibilities. A smooth-running operation runs far more efficiently and cost-effectively than one flying by the seat of its pants, and this section of your business plan will be another indication that you know what you’re doing. A large company is also likely to need additional operational categories such as human resources and possibly research and development.

One way to explain your organizational structure in the business plan is graphically. A simple diagram or flowchart can easily demonstrate levels of management and the positions within them, clearly illustrating who reports to whom, and how different divisions of the company (such as sales and marketing) relate to each other.

Here is where you can also talk about the other levels of employees in your company. Your lower-level staff will carry out the day-to-day work, so it’s important to recognize the types of people you’ll need, how many, what their qualifications should be, where you’ll find them, and what they’ll cost.

If the business will use outside consultants, freelancers, or independent contractors, mention it here as well. And talk about positions you’d want to add in the future if you’re successful enough to expand.

Business Management

Now that we understand the structure of your business, we need to meet the people who’ll be running it. Who does what, and why are they onboard? This section is important even for a single practitioner or sole proprietorship, as it will introduce you and your qualifications to the readers of your plan.

Start at the top with the legal structure and ownership of the business. If you are incorporated, say so, and detail whether you are a C or S corporation. If you haven’t yet incorporated, make sure to discuss this with your attorney and tax advisor to figure out which way to go. Whether you’re in a partnership or are a sole owner, this is where to mention it.

List the names of the owners of the business, what percent of the company each of them owns, the form of ownership (common or preferred stock, general or limited partner), and what kind of involvement they’ll have with day-to-day operations; for example, if they’re an active or silent partner.

Here’s where you’ll list the names and profiles of your management team, along with what their responsibilities are. Especially if you’re looking for funding, make sure to highlight the proven track record of these key employees. Lenders and investors will be keenly interested in their previous successes, particularly in how they relate to this current venture.

Include each person’s name and position, along with a short description of what the individual’s main duties will be. Detail his or her education, and any unique skills or experience, especially if they’re relevant to the job at hand. Mention previous employment and any industry awards or recognition related to it, along with involvement with charities or other non-profit organizations.

Think of this section as a resume-in-a-nutshell, recapping the highlights and achievements of the people you’ve chosen to surround yourself with. Actual detailed resumes for you and your management team should go in the plan’s appendix, and you can cross-reference them here. You want your readers to feel like your top staff complements you and supplements your own particular skill set. You also want readers to understand why these people are so qualified to help make your business a success.

This section will spell out the compensation for management team members, such as salary, benefits, and any profit-sharing you might be offering. If any of the team will be under contract or bound by non-compete agreements, you would mention that here, as well.

If your company will have a Board of Directors, its members also need to be listed in the business plan. Introduce each person by name and the position they’ll hold on the board. Talk about how each might be involved with the business (in addition to board meetings.

Similar to what you did for your management team, give each member’s background information, including education, experience, special skills, etc., along with any contributions they may already have had to the success of the business. Include the full resumes for your board members in the appendix.

Alternately, if you don’t have a Board of Directors, include information about an Advisory Board you’ve put together, or a panel of experts you’ve convened to help you along the way. Having either of these, by the way, is something your company might want to consider whether or not you’re putting together the organization and management section or your business plan.

NEXT ARTICLE > Business Plan Section 4: Products and Services

Apply for a loan, get started.

Loans from $5,000 - $100,000 with transparent terms and no prepayment penalty. Tell us a little about yourself, your business and receive your quote in minutes without impacting your credit score.

Thanks for applying!

Loans are originated and funded through our lending arm, Accion Opportunity Fund Community Development. By clicking “Continue to Application,” you consent to, Accion Opportunity Fund Community Development’s Terms of Use and Privacy Policy ; and to receive emails, calls and texts , potentially for marketing purposes, including autodialed or pre-recorded calls. You may opt out of receiving certain communications as provided in our Privacy Policy .

Small Business Organizational Chart

Searching for how to understand your business from the inside? You would require a tool that provides a high-level overview of the company. This article will tell you what a small business organizational chart is, how it is made, and why it is essential for your business.

1. What is a Small Business Organizational Chart?

A small business organizational chart is a document that presents an overview of a business, including departments and connections with other entities. It shows us how a company works internally, how its departments are functioning, the relationships with other departments, the head of the departments, etc. The diagram helps in many ways to control and track the business from the inside. The data can be used to produce analytics with meaningful information and intelligence.

Click on the image to edit. Source: EdrawMax Online

1.1 Types of Small Business Organizational Charts

Hierarchical organizational chart.

Hierarchical organizational charts are used for the companies or businesses that are small or enormous with hundreds of departments working. A startup can use a hierarchical organizational chart because if it does not belong to the parent organization, it would have five to six small departments with a few employees. Enormous companies can use hierarchical organizational charts because tracking such companies is possible with this type of chart.

The hierarchical small business organizational chart is used in every industry to get a high-level overview of the business. Whether small or large, a business can be mapped using the hierarchical structural model. On completion, you will get a hierarchy with every department working inside the company and their connections.

Functional Organizational Chart

If a business has large departments and works independently, then a functional small organizational chart can map those departments and their connections. The chart also presents more lines of communications for the directors and managers to collaborate with multiple teams. So, all the things are mapped in the functional small business organizational chart.

Matrix Organizational Chart

In a matrix small business organizational chart, those businesses are mapped with cross-functional departments. Due to the cross-functionality and multiple jobs of employees and departments, a complex hierarchy is made, which can be handled with a matrix organizational chart.

Circular Organizational Chart

Circular business organizational charts are more like hierarchical charts, but they are not mapped as described above; rather, the circle's core includes the leading positions in a circular chart. Other departments or staff cover the center forming a circle.

1.2 Does My Small Business Need an Organization Chart?

You will see this question almost everywhere in your quest to find bits and bytes about the small business organizational chart. People ask this question because they do not know the importance of a small business organizational chart. There are endless situations in which you would require a perfect small business organizational chart. Some of them are listed below. Below, we have gathered some use cases for our readers to showcase the importance of the diagram.

Help in decision making

Business organizational charts help the board of directors, managers, executives, and other business leaders to make the right decisions for the betterment of the business. If business leaders have an organizational chart on their table, they will quickly make decisions without any research.

Means of communication

An organizational chart helps employees know about the means of communication inside the business. With an organizational chart, an employee quickly knows to whom they must communicate or report.

Roles and Responsibilities

The organizational chart helps everyone understand how the business is working and the true sense of their roles and responsibilities.

Produce meaningful data for improvement

The organizational chart helps the analytics team understand the business's internal environment, which allows them to produce the intelligence to boost the business's growth quickly.

2. How to Create a Small Business Organizational Chart?

This section will tell you the general concepts used in making an excellent small business organizational chart. Before jumping directly at the tool, you must know how the chart is created. We will discuss the tool in the last section.

2.1 Know the type of structure your business follows

The first step you have to perform is very important, and it is the core of every small or large business organizational chart. Above we have already discussed the types of the organizational chart. The step is to find the internal structural model your organization follows. For those readers who skipped directly to this section, we will give an overview of the types of the organizational chart.

When you make an organizational chart, you first complete the hierarchies by seeing the employees' connections in the department or an organization. Those organizations with large departments will use the functional organizational chart. In the matrix model, those departments that work cross-functionally and have multiple jobs are mapped. Any structural model can be mapped on a circular model. In the circular model, the circle core covers the leading positions.

2.2 Gather all the data and information

After identifying the structural type, you have to gather all the data about every department working inside the organization. The information like the head of departments, functions, relationships with external parties, etc. Gather all the data like this and write it down for the next steps.

2.3 Pick up the suitable tool

Now, pick up the tool that will help you make an excellent business organizational chart. You can try multiple tools that provide diagram-making services, but the best practice is to get the tool that provides the template functionality and helps you in avoiding errors.

2.4 Complete the organizational chart

After selecting the tool according to your need, start building the organizational chart. You can begin with the template to boost productivity, then map all the data gathered and include the necessary organizational chart symbols. When completing the chart, send it to review from the supervisor for corrections and approvals.

3. Small Business Organizational Chart Examples

To make your mind clearer about the small business organizational chart, we have gathered some examples so you can take ideas and learn from them quickly.

Example 1: Small Construction Company Organizational Chart

It is the best example of a small construction company organizational chart. The chart shows the leading position of the CEO and then multiple positions like finance, operations, IT, sales marketing, etc. The sales manager gets notes from the marketing department. The diagram follows the hierarchical model only because of its size and lack of many employees.

Example 2: Small Business Coffee Shop Organizational Chart

The chart is of the small coffee shop organizational chart. The leading position of the owner is who gives directions to the administrator. The administrator manages the whole shop on behalf of the owner with the micro-manager below him. The micro-manager supervises the chef, waiters, and baristas. The chart also includes some degree of the functional structure.

Example 3: Small Real Estate Company Organizational Chart

You can get a quick guide from this small real-estate company organizational chart. The company is very small and follows the hierarchical structural model. There are only five employees, including the owner. The owner notes the positions below him, like marketing, payroll officer, managers, etc. The agents are also included as they bring clients to the company.

Example 4: Small Travel Agency Organizational Chart

This small travel agency organizational chart includes both hierarchical and functional models. The company has multiple departments and includes micro-managers like sales, operations, and administrators, who perform their respective tasks. The chart does not include any director and executive position; only managerial position is included. Such charts in which only administrative functions are included as a leading entity can be made for separate departments.

Example 5: Small Retail Store Organizational Chart

It is the construction company's organizational chart. The chart uses the hierarchical organizational chart model because construction companies don't have divisions spread across multiple locations. The chart can also be made using the matrix or functional organizational chart because some departments in the construction company work cross-functionally. So to handle them, you can take ideas from this chart and make yours. The chart does not include the business leadership positions, and so the diagram only depicts the department's managers working together.

Example 6: Small Cleaning Company Organizational Chart

It is the perfect example of a carpet cleaning company organizational chart. It includes hierarchical and functional models with multiple departments, but all work under the president's umbrella. The operations manager, salesperson, office manager are the head of their respective departments. All the departments in the organization are working independently.

4. Best Small Business Organizational Chart Maker

For this highly professional and time-consuming task, you can prioritize EdrawMax Online , developed by Wondershare. The application is full of features and easiest to use. You will make your diagram with drag-and-drop functionality in EdrawMax.

EdrawMax also includes the templating feature in which you can choose the template from the EdrawMax template library and start modifying it. The application has more than five thousand diagram-making symbols, which you can include with simple drag-and-drop. EdrawMax also allows you to import your project for further editing and export them in multiple formats.

Restaurant Organizational Chart

School Organizational Chart

Company Organizational Chart

Hospital Organizational Chart

Hotel Organizational Chart

Business Organizational Chart

Solving your most complex planning challenges

Explore Industry Research

What do Gartner, Forrester, and IDC have in common? They all named Anaplan a planning leader.  

Your success is the heart of our success

Hear from our customers at Anaplan Connect 2024

Join us for a day of connected inspiration from your industry-leading peers who have found the answer in agile, connected enterprise planning.​

Transform how you see, plan and lead your business

Get started today.

Explore on-demand demos to discover how our modeling and planning capabilities are designed to meet the specific and unique needs of your business.

Transform how you see, plan, and lead your business

We’d love to find out how we can help you

Events, training, and content for your planning journey

Visit our blog and newsroom

Your hub for Anaplan updates, insights, perspectives, and innovations.

Powerful partnerships to drive your digital transformation and deliver game-changing strategies. 

Solutions for your business, your industry, from the world’s leading alliances.

• wrappers --> Workforce Planning

Continuous workforce planning: Uniting finance, HR, and business

• Share on Twitter
• Share on Facebook
• Share on LinkedIn

Kouros Behzad

Director of Product Marketing, Anaplan solutions for HR and workforce planning

Learn how your HR, finance, and business leadership can all work better together to drive greater workforce planning agility.

In an era marked by swift technological advances and rapidly shifting market demands, the traditional workforce planning approach — primarily driven by finance-led budgeting and forecasting — is no longer sufficient. Leading organizations understand, to stay competitive, their workforce planning must evolve beyond isolated and departmental efforts into a cohesive working model that involves finance, human resources (HR), and business leadership. 

This approach is thoroughly explored in the Josh Bersin Company’s report on integrated workforce planning , which provides crucial insights into transforming organizational practices to foster resilience and adaptability. This blog delves further into the changing landscape of continuous workforce planning:

• Discover how integrating data and insights from various business functions can prepare your organization for future challenges and drive success. 
• Gain a clear understanding of the practical strides your business can take to transform your workforce planning, learning directly from the latest industry research and expert analyses featured in the Josh Bersin report. 
• Learn why investing time in rethinking your workforce strategy is not just necessary, but indispensable.

Integrating finance, HR, and business 

Traditionally, finance and business units have closely collaborated, effectively aligning financial strategies with operational objectives to drive organizational growth. HR has focused on recruitment and retention, often operating independently with limited integration into the broader business and financial planning processes. It's crucial to recognize the substantial value HR brings to an organization, from enhancing employee engagement to driving culture and supporting organizational change. Similarly, finance’s influence extends beyond budget management, impacting long-term planning and operational efficiency. 

The successful deployment of a continuous workforce planning process is contingent upon the systemic integration of HR with finance and business units. By doing this, organizations can leverage the unique strengths of each to enhance overall effectiveness and coherence. Finance is not limited to merely setting budgets; it deeply analyzes economic conditions and market trends to forecast both financial and workforce needs, providing a quantitative foundation for planning. HR complements this by delving into qualitative aspects, leveraging detailed insights into employee performance, skill sets, hiring and retention trends from across the organization. This allows HR to align workforce capabilities with long-term organizational goals and to develop targeted development programs that foster talent retention and growth.

Operational leaders from the business units, meanwhile, bring a tactical perspective by identifying the specific skills and roles needed to achieve current and future business objectives. This real-time insight ensures workforce strategies are not only aligned with overarching business goals but are also responsive to immediate market conditions and operational requirements.

Together, this trifecta drives a comprehensive workforce dynamic that combines financial foresight, human capital development, and operational needs. 

What does this look like in practice?

We have worked with a range of companies across multiple sectors to implement workforce planning. Here is a small sampling, by sector:

Technology : One of our clients, a major technology company, faced significant challenges in aligning their rapidly growing global workforce with strategic business initiatives. They utilized the Anaplan platform to overhaul their outdated workforce planning methods, which were not keeping pace with market changes and internal growth demands. This engagement enabled the company to implement a dynamic planning system that could adapt to global talent needs and business cycles effectively, promoting sustained growth and competitive edge in the tech industry.

Healthcare : A leading health sector organization struggled with maintaining adequate staffing levels due to fluctuating demands and a rigid traditional planning system. By adopting the Anaplan platform, they could forecast and adjust their workforce needs in real time, ensuring they met both patient care standards and regulatory requirements. This proactive workforce planning approach allowed them to optimize resource allocation across multiple facilities and significantly improve operational efficiency and patient outcomes.

Retail : A national retail chain utilized Anaplan to tackle the complexities of seasonal workforce fluctuations and the integration of new acquisitions into its corporate structure. The platform facilitated a cohesive strategy that spanned HR, finance, and operations, enabling the company to forecast and meet staffing needs accurately throughout the year. This strategic alignment helped them manage peak shopping periods and integration challenges smoothly, enhancing overall business resilience and market responsiveness.

The benefits of an integrated approach

This integrated approach not only streamlines decision-making and reduces complexity but also builds a robust foundation for scaling the organization effectively and harmoniously. In our work enabling companies across size, sector, and geography to implement continuous workforce planning, we have seen multiple benefits, with these four dominating: 

1. Organizational agility 

Integrated workforce planning enables organizations to swiftly navigate market changes and internal adjustments. By fostering a tight alignment among finance, HR, and business operations, this approach allows companies to rapidly pivot in response to external pressures or opportunities. The systemic communication and data sharing among these departments ensure quick decision-making, preventing delays and maintaining competitive agility.

2. Reduced complexity

A unified approach to workforce planning significantly improves the decision-making process across an organization. When finance, HR, and business units collaborate and connect their planning processes from the onset, it eliminates the confusion and inefficiencies that arise from separate and disconnected planning efforts. This holistic approach ensures that all parties are aligned and operating with the same information and goals.

3. Business harmony 

Integrated workforce planning cultivates a culture of transparency, collaboration, and shared objectives across critical organizational functions. This unity is fostered by aligning the visions of finance, HR, and business leaders, leading to improved morale, engagement and productivity, and retention. When these groups understand and support each other's roles and contributions, it enhances the organization's overall effectiveness and fosters a more supportive workplace environment.

4. Scalability 

Effective integrated workforce planning facilitates scalable growth, empowering organizations to expand seamlessly and proficiently. This cohesive approach establishes a durable framework that adjusts to evolving operational demands without compromising performance or focus. As companies grow, this flexibility becomes essential, enabling them to enhance resources and operations to meet escalating needs while preserving operational coherence and aligning with overarching business goals.

Embrace the new paradigm

The shift toward integrated workforce planning is not merely a trend but a strategic imperative for businesses aiming to thrive in a volatile world. By fostering a collaborative and transparent relationship between finance, HR, and business leaders, organizations can achieve a level of dynamism and resilience that traditional planning methods cannot match.

For a deeper understanding of how integrated workforce planning can transform your business practices, check out our on-demand webinar developed in collaboration with the Josh Bersin Company. 

Discover first-hand from industry leaders how to achieve organizational readiness and resilience through continuous workforce planning.

More From Forbes

Three leadership principles for navigating organizational change.

• Share to Facebook
• Share to Twitter
• Share to Linkedin

Chris Williams, COO, Interaction Associates , a leading provider of training & consulting services to build collaborative leadership culture.

When John F. Kennedy delivered his address in Frankfurt in 1963, less than two decades after the end of World War II, he had a message for the German people: Change was unavoidable.

“Change is the law of life,” Kennedy told the crowd. “And those who look only to the past or the present are certain to miss the future.”

This may be true. But it’s also true that many people don't like change.

It’s scary, unpredictable and disruptive.

Even though we know that progress is the product of intentional, strategic change, many of us resist it, preferring to stay comfortable rather than take risks. This is especially true at work where change, manifesting as disruption, innovation, or evolution, can be especially unpleasant.

Some worry about what change will mean for job security, established workflows and coworker relationships. Others are skeptical that “change initiatives” will produce results.

As noted in the Harvard Business Review, just 43% of employees say they are willing to support enterprise change initiatives, down from 74% in 2016. Change fatigue makes people less likely to explore new visions or pursue new directions.

The 33 Best Memorial Day TV Sales To Shop This Weekend

A psychologist reveals 3 ways to master ‘constructive disagreement’, wednesday star releasing her own tarot card deck and guidebook.

At the same time, change is happening more robustly and more frequently.

From the emergence of artificial intelligence (AI), the real-world ramifications of the “ Year of Efficiency ,” and the long-term ramifications of remote or hybrid work, it’s clear that the pre-pandemic office is gone, and new organizational dynamics are ascendant. In this environment, people need more from their leaders than the status quo.

Simply put, we live in a VUCA world where volatility, uncertainty, complexity and ambiguity are the new normal. This doesn’t have to be a bad thing. It just requires that leaders develop the skills to impactfully lead others through change.

Here are three principles that can help leaders navigate organizational change effectively.

Principle 1: Have a clear vision and plan.

Effective change starts at the top. Leaders must have a clear vision and a well-defined plan.

Just as importantly, leaders must be able to clearly articulate the reason for change. Often, change efforts provide a rational explanation but fail to address the emotional aspects of change. I've found the most effective leaders address both.

Change-ready leaders will be able to answer employees’ questions, including:

• What is happening now that merits our attention and the need for change?

• What specific changes are required in our current situation?

• What are the consequences if we do not address this problem?

• What is the burning platform?

• What is the vision of what the future looks like?

• What specific advantages or gains will result from achieving the desired future state?

• What are the emotional realities and impacts of this change?

By seeing the plan and understanding the rationale, people can be inspired to action, more comfortable with the change and more willing to embrace and support it.

Principle 2: Involve others in the change.

Change is hard. It is impossible for a single individual to enact the change in an organization. Navigating change successfully requires a team.

Many people don’t like being told what to do. By involving others, you are more likely to create engagement.

Effective leaders understand that involving others in the change process makes employees more likely to be engaged and buy in. Involvement creates and builds ownership.

Involving others also has a quick upside: the ability to not miss something important and gather input from frontline employees. This is especially useful when implementing a technical system change where the senior leader may not know the specifics. It is only by involving those doing the day-to-day details that the change requirements or process is made clear.

Some leaders struggle to involve others in the change process because they lack the shared language and framework for decision-making.

Leaders can use a simple but powerful framework called the “decision-making method.” There are two main elements:

1. Being clear on the decision to be made.

2. Deciding how much to involve others in the decision-making process.

For example, the decision to be made might be: how might we reduce our operating budget by 10%? The level of involvement might be: leader gathers input from individuals and decides . Or, if the decision is very important, it may be: consensus . If there is a safety issue or speed is paramount, the decision-making method might be: decide and announce .

This framework helps leaders consider how they can increase ownership and buy in. This is especially important in navigating organizational change as generally the more people are involved in a process or decision, the more buy-in you'll get. It provides a common language where people can ask, "How is this decision going to be made?"

Principle 3: Celebrate accomplishments.

Change efforts can often feel like a big project plan. We frequently forget the most important element of change—the people. By focusing our attention on people, we can be reminded of who we ultimately aim to serve and who we should acknowledge for their success.

As a leader, I challenge you to think about specific examples of employees, teams or divisions that are doing excellent work. How might you use this as an opportunity to acknowledge and celebrate this success?

Remember, the people make change happen at the end of the day.

One way to link these principles together is to consider:

• Do we have a clear vision and plan?

• Are there certain milestones we’ve achieved that demand recognition?

• How are we doing involving others in the change process?

• Are we seeing an increase in ownership, commitment and discretionary effort? If so, let’s acknowledge and celebrate this.

Change on purpose.

For many people, work is more than just a job. It’s where they create formative relationships, apply their creativity and find a sense of purpose and accomplishment.

Organizational change can disrupt that dynamic. That doesn’t mean it has to be chaotic or ineffective.

When leaders are visionary yet empathetic, well-prepared yet adaptable, and involved and involving others, they can transform potential disruptions into opportunities for growth, innovation and positive change.

Change isn’t ultimately about organizational priorities. It’s about catalyzing people around a shared vision. It’s people first, and that’s where the real power comes from.

Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify?

• Editorial Standards
• Reprints & Permissions