An organizational chart is more than just a two-dimensional snapshot of your company's hierarchy. When used correctly, an organigram becomes a living document that can be used as a powerful workforce planning tool. It helps HR professionals make the right HR decisions to spur growth and is a great tool for strategic planning.
Let's explore together the link between your company's organigram and strategic growth.
Why does a company need an organizational chart?
Many managers of small or even medium-sized companies mistakenly assume that they do not need an organizational chart due to the size of their company. However, the opposite is true. A well-designed organizational structure should be an integral part of any company's strategic planning, regardless of its size.
What can an effective organigram do?
An efficient and properly set-up organizational chart brings a number of benefits:
- It explains the workflow and responsibilities of your employees.
- Shows employee interactions.
- It helps employees understand where to look for support or answers to specific problems.
- It can visualize HR data to help make the right HR decisions, support business goals and help the company grow.
- Sets career development opportunities and addresses succession and succession processes.
Career development plan as a necessary complement to the company's organigram
The most permanent thing about business is change. No one is immune to it. Therefore, an essential tool for the long-term growth of your company must be a good preparation for the inevitable future change. Part of that preparation is undoubtedly human resource planning with an eye on who will lead the company into the next generation. Therefore, complement the creation of an organigram with the preparation of a career growth plan.
A career development plan helps you identify, mentor and develop high-potential employees. The plan should cover not just leadership roles, but all levels of your organisation's organigram.
Why is it advisable to complement the organigram with a career development plan?
Simply put, your organizational chart shows the current state of the company. A career growth plan, on the other hand, is a hypothetical chart that shows a future version of your org chart.
The two instruments are therefore interlinked and strategically relevant. If you don't have a good organigram in place, we have a simple five-step guide on how to prepare one and link it to your career growth plan.
Assess your business needs and analyse your current state
Start the creation of the company's organigram by answering the following questions:
- What areas will we need to develop to achieve the expected growth?
- Are we going to want to build a new division or a team?
On the basis of the answers to these two questions, analyse the current state of your organisational structure and identify the "white spaces" that may cause problems in meeting the above corporate objectives.
Identify key roles
Examine your entire company and identify the roles within your team that are most important to the productivity and performance of your business.
When identifying the key roles, take particular note of the following characteristics of the job:
- Number of employees reporting to the job
- Scope of control and decision-making powers
- Managed budget
The next step is to estimate future developments in key roles. In particular, it is advisable to focus on:
- Monitoring whether some of the employees in the most influential roles are pre-retirement age.
- How would you deal with the sudden departure of an employee working at a particular location.
- What skills and qualifications are important to include in key roles.
Identify strengths and weaknesses
The departure of an important and key employee is a challenge for any company. With the right organigram in place, you can identify the weaknesses in your management structure and work strategically to address them before they leave. Additionally, an org chart will show your management team a broad perspective, helping them to see the organization's workforce as a whole and recognize quality employees.
When creating an organigram, consider:
- Who among the current staff could step into a key worker role in the future.
- What skills current employees have.
- What skills do employees need to acquire to master the role of a key worker.
Based on this analysis, prepare a development plan for individual employees. Ideally, such a development plan should include all potentially key employees.
Keep track of potentially key employees
When you know who you see as a promising employee, you can monitor their development in detail and correctly identify when they are ready for promotion. This will prevent a situation where he might feel unappreciated and start to consider leaving. In addition, by identifying internal candidates for promotion, you save time and money spent on recruiting and training new managers.
Automate processes
Nowadays, creating a functioning organisational structure cannot be done without an automated system. Only small companies with few employees can afford to create an organigram manually. Larger companies, and especially multinational corporations with a large number of subsidiaries, cannot do without a program that creates the organisation chart automatically. Involve HR software in the creation of the organisational structure. The right HR software will keep an eye on the organisational structure for you and will also adjust the organisation chart whenever there is a change in the company hierarchy.
Are you ready to plan your human resources strategically to be prepared for the future?
Try Pinya HR software that helps you easily create and modify your organigram and automatically edit it for you. Jumpstart your business growth, request access to the Pinya HR demo and experience the benefits of HR software for your organization for free and without obligation.
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