2.2.2—Organization charts

An organisation chart is a model of formal reporting relationships and responsibility; it does not show every informal influence or communication path.

Tall structures usually give narrower spans of control and more layers, which can support supervision but slow upward communication. Flat structures reduce layers and may speed decisions, but managers can face a wider span and employees may need greater autonomy. Functional, product and matrix designs group expertise in different ways.

A global firm organised only by function may build specialist knowledge but struggle to coordinate a product launch across regions. A product structure may improve focus while duplicating specialist roles.

Flat does not mean unstructured, and a matrix does not remove conflict. Explain which coordination problem the chosen chart solves and what new cost it creates.

Read a chart in a fixed order: count hierarchy levels, trace each chain of command, estimate managers' spans of control, then identify how units are grouped. Grouping by function concentrates specialists; by product gives each offering clearer focus; by region adapts decisions to local markets but can duplicate functions. A flat chart has fewer layers and usually wider spans; a tall chart has more layers and usually narrower spans. The chart shows formal authority, not necessarily the real flow of influence.