10 Ways to Use Your Org Chart for Planning

7 minutes • Mar 6, 2019General
Using org charts for planning

How Are Org Charts Used?

When we think of the company organizational chart, we often imagine the boxes and lines that help illustrate an organization’s structure. Some of us use them and some of us would need half an hour to find it. For those who do use the org chart, how are they using them?

We conducted our own poll to find out exactly how business people were using their company org chart. Here’s what we found (respondents were able to check more than one use):

  • 34% - organization planning

  • 17% - help onboard new hires

  • 16% - discover who’s who and who does what

  • 12% - shown at company-wide meetings

  • 10% - shared with board of directors

  • 11% - other

It appears that the org chart has its most use for organizational planning yet in the same poll, we found only 41 percent of organizations are using them for this purpose. Nearly 60 percent have yet to discover the power the org chart has in aiding in planning. But what types of planning stand to benefit?

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10 Ways Your Org Chart Can Help You Plan Smarter

Organizational planning is the process of identifying an organization's immediate and long-term goals and objectives, and formulating and monitoring specific strategies to achieve them. It also entails staffing and resource allocation and is one of the most important responsibilities of a management team. As a business leader or manager, you are likely responsible for planning in some capacity. Whether it’s around budgets, resources or technology, planning takes time, vision and patience. Compiling data for analysis can be a painful process. It often requires multiple contributors who use their own system to manage their information, much of which is buried in lengthy spreadsheets. The process is generally manual and decisions are frequently based on historic information.

For organizations who want a better way to plan, using org chart software might prove to be a wise investment. Having an org chart that is updated in real time can be an ideal tool to gain visibility into the current business status. Here are 10 ways your org chart can be used to inform decision makers - without the use of a single spreadsheet.

Related: Why Is Real-Time Such A Big Deal?

1. Informing Headcount Through Organizational Planning

Headcount reporting isn’t as cut and dried as counting people across the company. Depending on who you ask, you will likely get different answers because departments have differing definitions of “headcount.” Does that mean full-time only employees? Part-time, too? What about contractors, temporary workers, and workers on leave?

The company org chart can be as detailed as a company or department wants to make it. The most basic org chart may only show full-time employees, yet layers can be added to include part-time and the other categories of workers. This gives business leaders an easy way to segment their populations and view only what is relevant to them. By doing so, they can get a more accurate headcount and ensure everyone in the company is using the same definitions. The org chart becomes the golden headcount record.

2. Identifying Resource Gaps

It’s not always easy to know where a team might be in need of added resources. A manager may have a differing opinion than his or her direct reports. Resources shouldn’t be added by only listening to the loudest person, yet that is exactly what often happens without any evidence to prove otherwise.

The org chart, on the other hand, provides a visual representation of how teams are divided and where responsibilities lie. It makes it easier to see where one manager is working with too few or too many employees and what kinds of skills that manager may need based on their current project types and loads. It shows where employees might be spread too thin or if there is available bandwidth to extend a resource beyond their current workload. Now, adding headcount is justified and managers can better determine what type of headcount they most need.

3. Illustrate Issues with Spans of Control

Span of control conveys the idea that each manager has an “ideal” number of direct reports. This number will vary from company to company and manager to manager, but understanding when a manager has an either too wide or too narrow span of control is often based on subjective opinions rather than fact. Managers may believe they can effectively manage more than they actually can or vice versa - they believe they are overwhelmed when maybe the skill composition of their team simply isn’t right.

Related: What’s Your Ideal Span of Control?

The organizational chart brings span of control to the forefront, making it transparent and evident. Business leaders can easily see (not just hear) how many direct reports each manager has, the skills of both the manager and his or her direct reports, the current projects on which they are working, and if those skills are aligned with project needs. The visual representation reveals where issues may be, where changes can be made, and where additional management may be required.

Ensure your managers are reaching their ideal span of control with this Span of Control Worksheet:

4. Planning Promotions and Career Paths

The number one factor on morale appears to be opportunities for career advancement. Employees want to know they can grow, learn and develop their skills. When they do, they develop a sense of loyalty to the organization who can provide it. Opportunities for such growth can be a major attraction for job seekers, yet organizations often struggle to map out career paths.

Many in HR and management positions are recognizing the benefits of the company org chart to help plan employee promotions. Org charts can serve as visual corporate ladders where employees can see opportunities to move vertically or laterally, depending on their goals. Org charts make it easier to identify potential movements, what skills would be needed to do so, and where employees stand to learn new skills. Instead of just talk, employees are given a roadmap.

5. Ensuring Enough Leaders and Managers for New Hires

Fast-growing companies may pride themselves in rapid hiring as it signifies real progress and demand. An often ignored component to adding new hires is that those new employees will need managers - and managers who have the bandwidth to train and educate new hires through the onboarding process. Going back to span of control, if managers already have a wide span of control, giving them more employees to manage may not be the best idea.

The org chart is the ideal tool to display current management positions and their spans of control. Business leaders can quickly identify which managers could most likely take on a new hire and which ones are at their limit. This information can guide decision makers in hiring management in preparation for adding headcount.

6. Moving People Around to Keep A Balance of Skills and Experience

As new hires are brought on board, it’s easy to lose sight of exactly where those new hires are going. A common challenge for organizations is ensuring teams and departments have an equal balance of both tenured employees and new hires. This ratio is important as more experienced employees serve to educate the new hires. When a team has too many new hires and too few tenured employees, there is a lack of tribal knowledge and the organization can suffer.

The organizational chart should go beyond the name and title level to get to the skill level and hire date level. By adding detailed layers such as these, management can readily identify how new hires and tenured employees are spread across the organization. They can better plan which prospects are most needed and where new hires are needed most. Instead of taking a shotgun approach, decision makers can be targeted and precise in how resources are divided.

7. Forming New Teams around New Priorities

Most companies introduce new products, services and/or strategies on a regular basis. These changing initiatives provide an opportunity to create new teams from within or hire necessary headcount to fill a need. It hasn’t always been a transparent process, however. It can be challenging to know who is already working on what and who can be pulled into a new project.

Business organizational charts help business leaders to get a comprehensive picture of the skill sets of employees. Instead of hiring outside skills, leaders can see what they already have and if those skills are available to take on a new priority. Employees are seen less as having specific job responsibilities and more as offering a set of skills that can be utilized across departments and projects. Not only does this help grow the employee, but it ensures all skills are being properly leveraged. Companies with flatter and holacratic structures, rather than more rigid matrix structures, are the most poised to take advantage of skills throughout their organizations.

8. Disbanding Teams as Projects End

Projects have their own lifecycles. Some make it to the end and others die an early death. Whichever the case, each project often requires multiple employees to see it through. What happens, however, when the project ends? Where is the best place for those employees to go, particularly if the team’s exact makeup was only required for that specific project?

Many organizations find the org chart helpful in knowing which teams can be disbanded and how the can be re-dispersed. Having a visual chart of sorts to see exactly what skills those team members offered on a particular project helps managers identify opportunities to reassign them to other priorities.

9. Prioritizing Resources

Understanding resource demand and capacity can be a complicated endeavor. Some resources are spread too thin, others are underutilized, and still more may be working on lower-priority projects when their skills could be better utilized elsewhere. Unless companies have invested in a sophisticated resource management platform, understanding these relationships can be difficult.

The org chart can provide some clarity. When decision makers can look at the organization as a whole, they can see the in-house skills and how they are allocated. It makes it much simpler to identify which resources can be moved to focus on higher priority initiatives. This ensures the highest priority projects have the right resources with the right skills. No more higher cost resources spending time on lower priority projects.

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10. Visualizing Composition of Teams across Geographies

Many companies have multiple locations and are geographically dispersed. This can make it difficult to see the composition of teams, such as the tenure of team members, responsibilities and current projects.

Modern org charts have the ability for business leaders to overlay extra information so business leaders can see geographically how teams are made up across the enterprise. The more information decision makers have, the more capable they are to make informed decisions. By being able to see how their teams are divided, where skills lie, which projects are in flight and which resources are devoted to them, leaders have the transparency they need.

Today’s org chart is no longer one-dimensional. It is an accurate, real-time representation of the current state of the organization and provides users the ability to add details that traditional org chart software simply doesn’t have. The features and functionalities of modern organizational chart software make the org chart a dynamic, interactive experience, giving business leaders much of the information they need to make decisions based on real-time data.

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