Organisational Charts

ORGANISATIONAL CHARTS

Organizational Charts are diagrammatic presentation of relationships in an enterprise. The Functions and their Relationships, the channel of Authority etc. are depicted in an Organizational Charts. George Terry defines an organizational chart as “a diagrammatical form which shows important aspects of an organization, including the major functions and their respective relationships, the channel of supervision and the relative authority of each employer who is in charge of each respective function.”

Organistional Charts can be divided into (i) Master Charts and (ii) Supplementary Charts. The Master Chart shows the whole formal organizational structure while supplementary chart shows the details of relationships, authority and duties within the prescribed area of department.

Types of Organisation Charts

There are Three ways in which organization Charts can be shown

1. Vertical 2. Horizontal 3. Circular

(i)Vertical or Top to Bottom : In this chart the major functions are shown at the top and subordinate functions in successive lower positions. Here the scalar levels run Horizontally and functions run vertically. The supreme authority is shown at the top and lowest authority at the bottom

(ii)Horizontal or Left to Right : In this chart the highest positions are shown on the left side and the authority level decreasing when moving to the right. Here the scalar levels in a vertical position and functions horizontally.

(iii)Circular : In circular charts the centre of the circle represents the position of supreme authority and the functions radiate in all directions from the centre. The higher the position of authority, the nearer they are to the centre and the lesser the position of authority, more distant they are from the centre.

Principles of Organisational Charts

While framing organizational charts following principles should be kept in mind

(i) The Top Management should faithfully follow the line of authority while dealing with the subordinates. Any attempt to bye pass the same will make it meaningless.

(ii) The chart should define line of position. The lines of different individuals should be so defined so that there is no overlapping and no two persons should be given the same position.

(iii) The undue concentration of duty at any point should be avoided

(iv) The organizational charts should not be influenced by personalities

(v) The organizational chart should be simple and flexible.

Advantages of Organization charts

1. Organization chart is a managerial tool , and it helps in specifying authority and responsibility of every position and results in smooth working conditions
2. It will avoid Overlapping and duplication of duties. If anything happens it can be rectified immediately.
3. The organizational charts will help in pointing out the faults, deficiencies, dual command etc. The management will be able to take remedial action in case of certain situations.
4. It will helpful for new entrants to understand easily the different levels of authority and responsibility.
5. The organization charts act as a guide for the decision makers.

Limitations

The organization charts suffers from various drawbacks:

1. The organization charts show the relationship of different positions and not the degree of authority and responsibility.
2. The chart only depicts the formal organizational relationship whereas informal organization is as useful as formal organization. Informal organization greatly helps management in knowing the reactions of the people and is an important channel of communication.
3. The chart shows the organizational position and status at different levels. It may lead to negative motivation and affects team work.