Following up to last week’s post about job descriptions, I thought now would be a good time to write about another key piece in developing a high performance work system – your organizational chart. If your business is small enough, you probably know what everyone does and who they report to – you, probably! But if you’ve grown, or plan to grow, you can get ahead of possible issues down the road by developing your organizational chart now.
First things first – how/where can you create an organization chart? A simple Google search will produce several free options online. Some require creating an account, or the finished product may include branding, but they’ll allow you to build a chart for your current structure. The option I prefer is to use the SmartArt feature in Microsoft Word. Open a Word document, select Insert, SmartArt, then Hierarchy, and you can start building your chart. This is also achievable in Google Sheets but isn’t quite as simple.
Your organizational chart is the formal documentation of your organizational structure. Organizational structure decisions impact the way your business operates, how employees interact, and to whom they report. When you decide how to structure our business, you should consider whether it is best for you to group employees based on the functions they perform, the customers they serve, the products they product/market/sell, or other considerations which are specific to you business and can impact efficiency and the ability to operate with synergy.
How you structure your business will also impact how you hire and promote. In some structures, it is best to choose managers with fundamental skill sets similar to those they manage and the chart will have many people with the same title grouped together – this gives you subject matter expects who have a detailed understanding of the work performed by the roles they manage. In other structures, you will likely need managers who are equipped to create vision and engagement amongst employees of varied skill sets and the chart will have a greater variety of job titles grouped together – think Line Managers versus Product Managers.
Your organizational structure will impact decisions related to hiring, job design, training, rewards systems, and if you get big enough, allocation of HR management responsibilities. An up to date organizational chart will ensure that your employees know who to go to with questions and concerns, how or by whom key information will be disseminated to employees, and who is accountable for ensuring employees are informed and their questions/concerns are addressed appropriately.
It always feels better to get organized, so if you’ve got some extra time on your hands at the moment, use it to your advantage. Create (or update) that organizational chart – you’ll be glad you did!