The company organizational chart: your complete guide to understanding and choosing the right structure

The company organizational chart is a well-known communication, management, and performance tool. Most organizations indeed rely on an organizational diagram representing their internal structure.

But what exactly is the purpose of a company organizational chart? What are the different types of organizational charts? How do you choose a chart adapted to your needs? What are the advantages and disadvantages of organizational charts? And finally, how do you create a company organizational chart?

Jint goes over the topic and reveals the secret to maintaining an effective and always up-to-date company organizational chart, with no effort. Happy readin

What is a company organizational chart, and why is it essential?

A company organizational chart is a kind of roadmap that allows an organization’s stakeholders (employees, clients, new hires, management, etc.) to navigate efficiently within it and instantly understand the distribution of its resources and the interconnections between them.

Company organizational chart: definition

More concretely, a company’s organizational chart is a visual representation of its internal organization. This graphic shows hierarchical, functional, and organizational relationships between employees or teams by positioning them meaningfully (pyramid, rake, constellation, etc.) and connecting them with lines symbolizing their relationships.

It is also referred to as a company diagram, or even a staff directory, or when enhanced with employee photos, a company directory. There are, moreover, many types of company organizational charts: functional chart, hierarchical chart, matrix chart, divisional chart, network chart, horizontal chart, and even holacratic chart.

Each of these organizational chart models reflects a specific type of corporate structure. There are organizational charts for SMEs, such as the hierarchical chart, and organizational charts for large companies, such as the divisional or matrix chart.

Main objective of a company organizational chart

The main objective of a company organizational chart is to facilitate internal and external collaboration and communication. Thanks to this diagram, employees and external partners can quickly know whom to contact based on their level of responsibility and position.

Imagine a supplier who wants to make a commercial offer to a company. They simply need to visit the company’s website and consult its organizational chart to instantly identify the decision-maker to contact about the project. The chart prevents them from soliciting an employee who has no decision-making power or no expertise in the relevant area. A real time saver for everyone.

The main types of company organizational charts

There are many examples of company organizational charts. Each model corresponds to a type of organizational structure and can be adapted depending on the company’s needs and objectives.

Here are the main types of company organizational charts:

The hierarchical or pyramidal organizational chart

The hierarchical or pyramidal organizational chart is one of the most common models. As its name suggests, this visual representation highlights the company’s hierarchical structure. The CEO or executive committee appears at the top of the diagram, followed by managers on the next line, and then the employees or teams reporting to each manager.

This type of diagram has the advantage of making everyone's authority and responsibilities immediately visible, as well as internal reporting lines. Everyone knows whom to refer to for approvals or instructions. Employees can also clearly visualize their potential career paths within the company.

On the downside, the hierarchical chart can represent a rigid chain of command, sometimes resulting in slow decision-making and a lack of autonomy. It is therefore better suited to SMEs and more traditional companies rather than large corporations with complex structures or startups seeking agility and innovation.

The functional organizational chart

The difference between a hierarchical and a functional chart is that the hierarchical one emphasizes reporting relationships (CEO, department directors, managers, employees), while the functional chart emphasizes specialization. The functional organizational chart groups employees based on their expertise and explicitly lists it (accounting, payroll, etc.).

To make the company structure easier to read, the functional chart is often combined with the hierarchical chart: leaders are placed at the top; department directors (marketing, HR, accounting, etc.) appear on the next line; then employees or teams are grouped by role (communications, product marketing, sales, etc.).

This type of chart fosters understanding of everyone’s role and thus improves operational efficiency. It also strengthens employee engagement by highlighting individual expertise. However, it may lead to siloed operations, where departments communicate poorly, cross-functional collaboration is hindered, and productivity is limited.

In practice, the functional organizational chart suits medium or large companies specialized in a product or sector, where each employee’s or unit’s responsibilities are clearly defined.

The divisional organizational chart

The divisional chart is suited for large companies offering multiple products or services, targeting different customer groups, or operating across several geographic regions. It clearly represents the relationships between divisions and the internal structure of each.

A classic divisional chart places general management at the top. Then come the directions for each geographic area (Europe, Asia, USA, etc.) or services dedicated to each activity. On the lines below are the divisions within each direction or service (production, marketing, sales, etc.), and sometimes details of the functions within each (marketing, HR, production, for example).

Companies adopting a divisional structure grant autonomy to each division. Each has its own support and operational functions. However, this can create silos that hinder internal cooperation and may generate additional costs due to duplicated roles (e.g. multiple HR departments).

The matrix or project-based organizational chart

The matrix organizational chart, or project-based chart, combines operational and functional structures. It highlights the dual reporting relationship that an employee or project team may have. Typically, general management appears at the top, followed by functional directors. Project teams are displayed on lower lines. The project managers overseeing each team appear at the end of the row, usually on the left.

This organizational structure highlights dual hierarchies—functional and project-based—found in some companies. It encourages resource sharing and collaboration between functions (sales, marketing, production, for example). Its main drawback remains its complexity, which may hinder understanding of the chain of command and even cause conflicts between managers with differing objectives.

Naturally, this is the ideal organizational chart model for large companies conducting extensive, demanding, and innovative projects.

The network organizational chart

The network organizational chart appears as a constellation or spider web. It lists internal and external stakeholders (service providers, suppliers, subcontractors, etc.) and maps their relationships by grouping them by market, function, or status (freelancers, for example), and connecting them through arrows or lines.

This flexible structure fits innovative companies (startups) seeking to optimize costs, gain agility, and seize opportunities quickly thanks to external skills. However, its strength is also its weakness: power and information are not centralized, which may lead to a loss of control and coherence.

Why is a company organizational chart so important?

Creating a company organizational chart offers many benefits for employees, management, clients, and external partners.

Benefits of organizational charts for employees

The importance of an organizational chart for employees is undeniable. This communication tool clarifies roles, responsibilities, and hierarchical, functional, and organizational relationships. Shared on the intranet, it helps employees know whom to consult when a decision must be made or when they need internal expertise.

The organizational chart strengthens cohesion, communication, and collaboration since everyone’s mission and position are clearly identified. It is especially useful for new hires, helping them orient themselves, understand how the organization works, and integrate more easily.

Finally, the organizational chart can showcase employees and their expertise. It may include their names, positions, specializations, and even their photos. This fosters recognition, belonging, and overall engagement and productivity.

Benefits for management

The organizational chart is a strategic decision-making tool. It allows leaders to quickly visualize the company’s operations and departments. As a result, top management can identify hiring needs, detect organizational issues, optimize structure, improve resource allocation (skills, training, budgets, etc.), and communicate more effectively with employees.

Benefits for clients, partners, and candidates

Creating an organizational chart is essential to facilitate relationships with clients, partners, prospective candidates, and even administrative bodies. This communication tool, which can be shared on the company website, allows external stakeholders to quickly identify the right contact person for proposals (orders, partnership offers, commercial offers, etc.).

In summary, a well-designed organizational chart can help you seize business opportunities, gain more clients, and attract more talent. It signals professionalism and clarity.

How to create your company organizational chart?To design your organizational chart, you must follow several steps:

Choosing your organizational chart type

The first step is selecting a model adapted to your structure. To do so:

• Analyze your corporate culture (are you more collaboration-oriented or focused on efficiency and departmental autonomy?) and review your actual structure by listing your divisions, departments, directions, or project teams, the members of each, as well as their roles, responsibilities, and expertise.
• Consider your company size. An SME can often adopt a simple organizational chart (hierarchical, for example), while a multinational group may require a more complex model (such as a divisional chart).
• Identify your objectives. Each type helps achieve a specific goal (e.g., matrix charts improve flexibility). Moreover, your organizational chart’s purpose will determine which information should appear (team names, employee names, positions, expertise, contact details, etc.).

Creating your organizational chart

The second step is to visually translate your structure using a predetermined model. You can use templates available online and tools like Microsoft PowerPoint.

The best way to create your company directory easily is to use Jint’s “organizational chart” widget. This module, integrated into your Jint Digital Workplace, generates a chart displaying information based on your Microsoft 365 Entra ID (formerly Azure Active Directory) data: user photos, positions, contact details, manager, location, skills, team, etc. Note that to benefit from this feature, you must create a SharePoint intranet and use the Jint extension, or use Jint for Teams & Web intranet.

Updating your company organizational chart

To remain relevant and useful, your organizational chart must be regularly updated. It must reflect organizational changes and staff movements (departures and arrivals, job or team changes, etc.).

Of course, if you have a digital organizational chart, updating is easier or even automatic. That’s why we recommend making a dynamic organizational chart one of your intranet’s essential features.

Company organizational chart: key takeaways

• A company organizational chart is a visual and schematic representation of the hierarchical, functional, and organizational structure of a business, administration, or association.  
• This communication and management tool is a performance lever. It enables internal and external stakeholders to understand how the collective operates and identify the right contacts to collaborate effectively, optimize processes, or rationalize resources. Organizational charts are also essential in HR management—for example, to identify hiring needs.  
• A well-designed, effectively shared, and regularly updated organizational chart is a vector of engagement, productivity, and growth. Choosing the right tool to create your organizational chart is therefore crucial. Opting for a dynamic chart synchronized with your internal data and highlighted on your intranet is the best option. Jint’s photo board module meets all these requirements.

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