Organization charts are an endeavor to record the formal relationships in an organization, showing some of the relationships, the MAIN lines of communication and the downward flow of authority and responsibility through all the levels of the management hierarchy.

• Thought is needed in constructing charts, as this exercise forces executives to think more specifically about organizational relationships.
• Records and charts provide information to people who wish to know about the enterprise and are useful in instructing new personnel on company organization.
• They form a basis for organizational change and, by projection into the future, can aid the evaluation of organizational planning as strengths and weaknesses can be OBSERVED.
• They soon become out-of-date.
• Human relationships cannot be shown on paper, even when they can be defined and described.
• They introduce rigidity into relationships, as people tend to keep within their charted area and become too conscious on boundary lines. (This is one reason why the American Chrysler Corporation deferred using orgainsation charts for a long time. They wished to encourage the crossing of lines of authority and to retain flexibility).
• Costs of preparation, storing and studying charts may be more than their benefits are worth.
• They introduce status problems. People may not wish comparisons to be made between themselves and others. (The author RECENTLY asked a human resources manager why his company had no organization chart. He replied in one word, ‘Politics’.)

If the above disadvantages are considered carefully most of them can be overcome and, if the charts are carefully COMPILED, kept up-to-date and regarded purely as an aid, they can be of assistance to management.

There are certain conventions which are generally in use in the compilation of charts. Line relationships are shown by a continuous line. A position, function or unit is often enclosed by a ‘box’. Sometimes names of personnel occupying positions are also included in the box. Broken or dotted lines are used to denote functional relationships and vertical and horizontal lines link BOXES.

Organization charts are an endeavor to record the formal relationships in an organization, showing some of the relationships, the main lines of communication and the downward flow of authority and responsibility through all the levels of the management hierarchy.

If the above disadvantages are considered carefully most of them can be overcome and, if the charts are carefully compiled, kept up-to-date and regarded purely as an aid, they can be of assistance to management.

There are certain conventions which are generally in use in the compilation of charts. Line relationships are shown by a continuous line. A position, function or unit is often enclosed by a ‘box’. Sometimes names of personnel occupying positions are also included in the box. Broken or dotted lines are used to denote functional relationships and vertical and horizontal lines link boxes.