5 Things Everyone Gets Wrong with Org Charts
Many companies use org charts, mainly to illustrate reporting relationships and show where work gets done in the organization. However, there are many more uses and benefits associated with org charts. We’ll dispel some of the myths and describe the five things people commonly get wrong when it comes to org charts:
1. Limiting Org Charts to Showing Reporting Relationships
Many traditionally think of org charts as boxes connected by lines that show the managers at the top and the people who report to them flowing down. While it’s true that many traditional top-down org charts do outline reporting relationships, org charts can serve other purposes. They can also be used to help employees interact with each other and become more informed about the organization and where their jobs and teams fit in. Some of the other benefits of modern org charts include:
- Live org chart features that help leaders visualize future hiring or reorganization plans
- Illustrations of team relationships by product, function, or geography
- Personalized profiles that employees can update to include photos, information about their work history, specialized training, and more
Modern org chart software can also be used with different types of organizational structures. As organizations grow and become more complex, their org charts change and may reflect a more matrix-like structure. In some organizations, the org chart is organized by key business processes rather than a chain of authority, as in the example of companies that have transitioned from a hierarchy to a “holacracy.”
2. Confusing Org Chart Position With Leadership
There’s a common misperception that the person who occupies the box at the top of a company org chart is accountable for all the work that gets done. While department managers, presidents, and CEOs have a responsibility to lead and may be seen as the ones “in charge,” those individuals are not the only ones who lead. Others in the organization lead by example and coach employees to do their best, all without being in the top box. Based on this reality, it can often be helpful to think about your org chart not just in terms of who manages whom, but in terms of where true accountabilities lie and which individuals influence the work that gets done in the organization. Live org chart technology can help to highlight team leaders, project managers, and other leadership positions that may exist throughout the organization.
3. Using Org Charts Only in Large Organizations
Judging by the looks of the very first org chart, a large, complex organization had a lot to gain from an org chart that could make sense of its dozens of interconnected teams across the country. But org charts aren’t just for large companies. They can be beneficial to small companies in the following ways:
- Helping the company plan for future growth
- Providing a professional illustration of company structure that can be shown to bankers or prospective VC partners
- Helping new employees understand individual responsibilities
- Even if your company is really, really small, you can benefit from an org chart. As one author and entrepreneur explains, even one-person startups benefit from charting out work functions that may someday be performed by more than one person.
4. Confining Org Charts to Paper or a Word Doc
It used to be that the only way companies could create an org chart was with word-processing tools or org-chart systems that only recognized traditional top-down org structures. HR or department administrators took hours lining up boxes, entering names and titles, and producing a document that was completely outdated after a few key hires.
With modern org chart technology that integrates with other digital workplace tools, org charts are easy to keep updated in real time. Companies can place the chart in a mobile app (rather than a paper filing system where the org chart never gets used) and also give employees the ability to update certain aspects of their org chart profiles.
5. Misalignment With Organizational Accountabilities
There’s nothing worse than an outdated, inaccurate org chart that no one pays attention to or uses. One of the reasons for a neglected org chart could be that it doesn’t accurately reflect employee accountabilities. If you have matrixed and dotted-line reporting relationships, your org chart should reflect that, even if your prior paper-based or word-processing system didn’t have that capability. When you use live org chart software that has the flexibility to organize by how work gets done (by product, functionally, team, etc.), the org chart becomes a beneficial, interactive workplace tool rather than an old file that no one opens.
Part of the beauty of org charts is that they can be used in different ways by organizations of different sizes and at different stages of growth. No longer the static, paper-based org chart that showed everyone in boxes from the CEO down, modern org chart technology can transform your organizational structure into a live org chart that tells employees more about each other and represents your actual structure, in real time. As your organization grows, the live org chart grows and changes with it.