12 Free Organizational Chart Templates (PowerPoint)

An organizational chart is a visual display of position titles, relationships, position holders, and the associated roles and responsibilities.

These connections between job positions and staff members in the company formulate a company’s internal structure. The chart indicates the employee designations and reporting managers within the organization.

The elements of the chart (positions and employees) are represented by shapes such as boxes and interlinked using straight or elbowed lines to show the relationships and operating levels. This way, you can show the relationship hierarchy of the employees and the company’s bureaucracy, providing information that can be used to create an alignment matrix of teams. In addition, the chart can be created to include photos, contact details, icons, illustrations, and email.

The first modern version of an organizational chart is believed to have been designed by Daniel McCallum (a general superintendent) in 1855 in collaboration with George holt Henshaw, a draftsman, and civil engineer. This version illustrated the New York and Erie Railway. However, the term “organizational chart” was introduced and popularized by Willard C. Brinton in his book Graphic Methods for Presenting Facts, published in 1914. Then, the charts were common in engineering. However, by the 1920s, they began to be incorporated into the business. Other terms used to refer to the chart include organigram and organogram, which were introduced in the 1950s.

The alternative names of an organizational chart are:

• Organization chart
• Org chart
• Organogram
• Organogram chart/organigram or organigrammes
• Hierarchy charts

Org charts can be used by different parties in a company, including:

• Recruiters/hiring managers
• Employees
• New hires

Organizational charts have multiple uses in organizations. Therefore, you can benefit from these charts in different ways, from onboarding new hires to succession planning. The chart can indicate the organization of a company in a broad view or narrow it down to specific departments or units. This way, employees can see how their roles fit into the overall operation of the company. Information in the chart is extremely helpful during the restructuring of the staff or management.

Here are the different uses of organograms:

Restructuring 

An organization chart can be used whenever you want to restructure your team. For example, you can use it to identify which employees have talents better suited for specific roles. This way, you can optimally utilize these talents and improve performance and productivity.

Workforce planning 

The charts are valuable tools when it comes to workforce planning. You can use it to record important information regarding your workforce. For example, when undertaking a new hiring initiative, you can note vacant positions.

Resource planning 

You can use an org chart to determine and resolve resource inefficiencies in your company. The chart determines how roles can be rearranged to optimize resources in such a case.

Organizational communication 

An organizational chart is also used as a communication tool. Since it displays a company’s workforce, it can communicate to whom different employees are expected to report. It can also show the relationships between positions. Employees also use it to get familiar with each other. Photos can specifically play a huge role in helping employees get familiar with their colleagues’ faces and names.  

Genealogy 

The chart can be used to show the genealogy of a group of people. The chart can include photos, dates of birth, and links to a person’s profile. The organization chart can thus be utilized as a family tree.

Budgeting 

An organigram can be used for budgeting purposes. Since it displays the functions of different positions, management can use the chart to determine the associated expenses and areas they can save on these costs. The charts are also helpful in budgeting for healthcare expenses, team outings, planning appraisals, etc.

New hire onboarding 

The charts effectively communicate a company’s reporting structure to new hires, which is an integral part of onboarding. At a glance, a new hire can see who is at the top, mid, and low-level management. This way, they can determine who their leaders are, who to contact for different issues, their colleagues, and who’s who. This expedites the assimilation process for new hires.

Inspiring employees 

Since the chart shows the hierarchy of employees in the company, it inspires employees by showing them the path they can take to climb the ranks. This helps employees in planning for their career paths within the company. This is because each employee can identify their place on the organizational ladder. For example, a graphic designer who wants to become a project manager can identify the project manager’s career path and who is best suited to guide them. 

Organizational charts are meant to suit their intended purpose. However, there is a general procedure you can use to plan your organizational chart.

Below are three steps to undertake before creating the chart:

Step 1: Define your purpose and scope

The first step is defining the purpose and scope of your chart. These two aspects will depend more on how you intend to use the chart. For example, do you want it as a communication tool? Or a “who’s who” resource? Or an onboarding tool? Is it a chart of the entire company or a departmental one? These are examples of questions you should ask yourself to define the purpose and scope of your chart.

Step 2: Gather the information 

An organizational chart ought to be informative. You, therefore, have to gather information to include in the chart. Information that should be gathered includes a list of employees, photos, contact details, etc. You can also find a current or outdated org chart as a starting point. You must also indicate the lines of authority on the chart. You should also illustrate the existing hierarchy and employees under each manager. The chart should show employees’ details without having to click on their profiles to make it more functional.

Step 3: Determine the platform you want to use 

You can create your own organizational chart for your company by using a template or software. An effective template should capture the hierarchy, employee designation, functions, photos, and contact information. It is beneficial because it prevents you from creating an incorrect organizational chart. An incorrect chart results in poor communication, making it difficult to identify people responsible for different tasks. It also results in a poor flow of information, which can lead to disagreements in the workplace.

Step 4: Keep updating the chart 

An org chart is a dynamic document that ought to be updated whenever there are changes in the company’s structure. This is because if not updated, the chart displays incorrect information, resulting in slow decision-making, confusion within roles, poor coordination between team members, and failure to share ideas. Consequently, these can lead to stress and conflict within the workplace and unnecessary complexity in performing assigned duties. An incorrect org chart makes it difficult to assign tasks and enforce accountability within the company.

Different types of org charts are used in management. The type of chart you use depends on your needs and type of organization. Regardless of the type, the chart should transparently show the company’s overall structure and your employees.

The following are the types of organizational charts:

Hierarchical/vertical/top-down organizational chart 

The hierarchical type is the most common type of organogram. This chart displays the highest-ranking individual at the top of the hierarchy, and the lower-ranking positions follow. A hierarchical chart takes the shape of a pyramid. The hierarchy will depend on the company size, industry, and geographical location. For example, a public company will have the organizational structure in the following order. Stakeholders are placed in the highest rank, followed by C-Suite management (e.g., Chair of the board of governors, CEO, etc.) and other leadership positions (e.g., President, managers, directors, full-time or part-time employees, etc.)

The advantage of this type of chart is the clarity and stability of the company’s structure that it provides. However, it has the disadvantages of being rigid and not being flexible when needed. Also, various levels of management can bloat the structure of the company.

Flat/horizontal organizational chart 

A flat organizational chart displays the positions at the same level. This shows the power and decision-making sharing within the company. In such a structure, many middle management levels are eliminated. Such a chart suits start-ups and small companies, not large companies with many employees and projects. This type of chart is advantageous in that it enhances teamwork and autonomy. However, in such a structure, conflicts are more likely to occur.

Matrix organizational chart 

A matrix organizational chart organizes employees in a grid-like structure. This is because the employees have similar skill sets and may report to more than one manager. Employees will typically report to multiple managers when they are working on different assignments/projects. Such an organizational structure encourages cooperation and cross-department relationships. However, it is disadvantageous in that it can result in conflicts of interest and interfere with employees’ loyalty due to having to report to multiple managers.  

Divisional organizational chart

Such a chart is meant for companies with multiple divisions, which could be based on product lines or geographies. You can have an org chart for each division or a multi-divisional structure. A multi-divisional (also M-form) structure can be used to illustrate a parent company’s organizational structure with subsidiaries under its brand and name. Such a structure allows the independent operational flow of each division. This way, when one company fails, its subsidiaries are not affected. This, however, has disadvantages such as increased taxes and operational inefficiencies as a result of separating functions.

Network organizational chart 

The network type of organizational chart is used to display the internal and external relationships/social networks of the top-level management and managers. They are decentralized and flexible. As a result, it can be more complex than other types of charts. A network organizational chart is focused on encouraging autonomy, rapid communication, and trust in relationships. The chart allows leaders to manage, facilitate, and coordinate internal and external relationships. As a result, this type of chart could be suitable for organizations that plan on growing rapidly, evolving exponentially, and existing in a constantly changing environment. 

Line organizational chart

A line organizational chart shows the authority hierarchy/chain of command from top to bottom. Each department on the chart is headed by a department head. Each department is considered to be self-contained and independent decisions can be made by the line officers. This type of chart is advantageous because it fosters effective communication, which translates to stability within the company. 

Team-based organizational chart 

This type of organizational chart is used to illustrate teams who are working on independent tasks but are jointly working towards a common goal. Such a structure is focused on decision-making, teamwork, and problem-solving. Such types of organizational structures have allowed people from different industries to cooperate towards working on goods and services.

Limitations of Using Organizational Charts 

Despite the many advantages of using organizational charts, they have limitations. Some of these limitations are as follows:

They do not reflect the management style

Org charts simply show how authority is allocated in the company and not necessarily how it is exercised. Therefore, there may be discrepancies between how authority is reported on the chart and how it is enforced, leading to poor communication. 

They can quickly become out of date

The charts can quickly become outdated, especially if your company has a high turnover. However, this can be mitigated by using online/automated organizational charts. This way, employee arrivals, and departures can be automatically reported on the chart. This type of chart is easier and faster to update compared to physical charts. It, therefore, has to be regularly reviewed to prevent it from being outdated.

They only show formal relationships

Org charts do not report informal and social relationships within the company, which can be vital for the execution of operations. Therefore, you will often have to create an account map to complement the organizational chart.

The organizational structure of any company is essential in undertaking operations within the company. So, it is vital to have a place where anyone can learn your company’s structure at a glance. 

An organizational chart is an effective way of illustrating the company’s structure. While templates are practical tools when creating organograms, you should also consider using online charts, as they are easy to update and automate. Org charts are suited for any company (start-up and established) and in any sector.