What is a company organisation chart?

What is an organisation chart, and how does it work in companies?

Visually depicting company structure and key for workforce planning and management, an organisation (‘org’) chart illustrates the relationship between employees, departments, and roles. Businesses, in turn, can define reporting lines, job functions, and hierarchy.  

While small companies can perhaps operate more informally, larger organisations need a clear and structured org chart to improve efficiency, communication, and accountability across teams.  

Why are organisation charts important?

Org charts are particularly valuable for large companies because they:

• Clarify Roles and Responsibilities: Employees understand who to report to and who the key decision-makers are.
• Improve Communication: In mapping out inter-team relationships, org charts help streamline internal communication and collaboration. 
• Support Workforce Planning: HR teams can identify gaps, overlaps, or inefficiencies in organisational structure.
• Enhance Onboarding: New employees can quickly grasp company structure and key contacts.
• Aid Succession Planning: Organisations can pinpoint potential future leaders and ensure smooth transitions. 

Types of organisation charts 

Org charts of all persuasions are each suited to diverse business needs. The most common types (and their strengths and weaknesses) include:

1. Hierarchical organisation chart 

The most traditional and popular structure, this chart follows a top-down approach where employees report to a single manager with departments divided by function/division.  

Strengths 

✔ Clear authority and chain of command 

✔ Defined career progression paths 

✔ Good for large corporations 

Weaknesses 

✖ Can create silos and hinder cross-team collaboration 

✖ Multiple approval layers slow down decision-making 

 

2. Matrix Org Chart  

These employees have multiple reporting relationships and often work across different teams/projects while maintaining functional roles. 

Strengths 

✔ Encourages cross-department collaboration 

✔ Leverages employee expertise 

✔ Integrates diverse perspectives to fuel innovation 

Weaknesses 

✖ Can create confusion re: reporting relationships 

✖ Employees may grapple with multi-manager expectations 

 

3. Flat Org Chart 

This has few (or no) middle management layers, promoting an open and flexible environment.  

Strengths 

✔ Encourages direct communication and quicker decision-making 

✔ Empowers employees and innovation 

✔ Reduces bureaucracy 

 Weaknesses 

✖ Muddies authority and responsibilities 

✖ May not scale well for large organisations 

 

4. Divisional Org Chart 

This structure groups employees based on product lines, markets, or geographical regions rather than functions. 

Strengths 

✔ Focuses on specific market needs/product expertise 

✔ Speeds up decision-making within divisions 

✔ Improves customer focus and specialisation 

 Weaknesses 

✖ Can duplicate resources across divisions 

✖ Divisions risk operating independently rather than collaboratively 

 

5. Functional Org Chart

This organisation chart groups employees by job function (e.g., HR, Finance, Marketing, IT). 

Strengths 

✔ Encourages functional specialisation/expertise 

✔ Standardised processes boost efficiency 

✔ Clear intra-departmental career progression 

Weaknesses 

✖ Can create departmental silos 

✖ May trigger cross-functional project inefficiencies 

Different scenarios

Organisational structures are rarely static: companies evolve, departments expand, leadership changes. Multiple organisational scenarios are thus critical for: 

• Future Workforce Planning: Anticipating how company structure will evolve 
• Restructuring: Assessing how changes (e.g., mergers or new leadership) impact operations 
• Crisis management: Planning to stay productive when leaders leave or budgets are cut
• Succession planning: Identifying future leaders and easing transitions for key roles 

A flexible organisation chart ultimately helps businesses adapt quickly to changes with improved agility and decision-making.  

Effective workforce planning via Sympa’s organisation chart

HR software solutions like Sympa offer one of the most effective ways to create and modify org charts, Sympa’s system featuring a dynamic chart that helps businesses:

• Tweak structures easily by adding, removing, or reassigning roles.
• Visualise diverse organisational workforce planning scenarios.
• Stay GDPR compliant by securely managing employee data.
• Collaborate better with a clear overview of reporting relationships/department structures. 

In leveraging software like Sympa, companies can move beyond static org charts while adopting a flexible, data-driven workforce management approach. 

In summary 

Large, complex businesses must enlist the help of organisation charts to help employees best understand hierarchy, roles, and responsibilities. Choosing the right type—whether hierarchical, matrix, flat, divisional, or functional—all depends on the company’s size, goals, and industry. 

Building multiple organisational scenarios, meanwhile, helps businesses prep for growth, restructuring, and leadership transitions. Organisations can lean on Sympa’s HR software to easily modify, analyse, and optimise their structures in real time for a more nimble, well-organised workforce.