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Many business owners have the idea that organisational charts and structures are for big businesses. After all, small businesses know who’s in the organisation – where’s the need for a formal structure? But setting up an organisational chart doesn’t just designate who works there; it also gives everyone a basic understanding of each person’s role, who they report to, and – most importantly – how you intend to grow the organisation in the future. And it’s not all effort, either. Creating your organisational chart can be an exciting exercise for a CEO. You’re not just making a chart; you’re building your vision for the organisation and the roles that your team will play in making that vision a reality.
What is an organisational chart?
An organisation chart is a graphical representation of the different key roles within your organisation, how each relates to others, where in the hierarchy they fit, and how information flows through the company. It helps employees to understand their role, and who they can expect to give and receive information.
Here is an example of an organisational chart:
When to create an organisational chart
The optimal time to create your organisational chart is right at the beginning – in the business planning stage. This allows you to plan out the people (and the funds that their employment will require) that your organisational will need at each stage in its development. Too many businesses end up with their CEO overstretched and burnt out, trying to do the jobs of many people. Good planning at the right time minimises this problem by assigning funding to critical tasks.
How to create an organisational chart
There are a number of different options when it comes to actually creating your organisational chart. Use Word’s SmartArt graphic creator, Visio’s organisational chart template, or Excel’s organisational chart type. Or aim for a more interactive format with an online tool like Organimi.
First, figure out your executive management team. What do you need them to do, and how? Once you have this layer of personnel in place on the chart, add the supervisors and team members that each manager will need to complete their mission.
What to do with your new organisational chart
Your new chart is an essential tool when it comes to recruiting the people you need to make your vision a reality. Fill positions from the top down, using the chart to understand which positions to recruit and the skills that each will require. For example, a Sales Manager with both media and sales staff reporting to them will need sales, management, and media experience in order to be effective.
An organisational chart can also be used to measure the growth of your organisation: how it has changed over time; and how close you are to recruiting all of the key people that you need.
Remember to share your organisational chart with your employees, too. Ensure that it’s in a format they can quickly understand and absorb, whether it be printed on a poster on the wall or made available on the organisation’s intranet. Make it prominent, so that employees (especially new hires) can find and consult it easily.