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Design your Chart

If you could redesign your business from scratch, how would you set it up? How large would it be? What departments would you have? How many layers of management would you have? What work would your employees do and what work would you out source?

Put your current Organizational Chart to one side for now. You'll want to work from a fresh perspective, one that takes into full consideration the breadth of your Corporate Vision, rather than simply an expansion of the way things are today.

Reread your Strategic Objectives (see Leadership) and determine if they still represent a realistic projection of your business into the future. Assuming they do, they will give you a good place to start. If not, you should update them before going any further.

Draw your company's Organizational Chart, as it will function when you have achieved your Strategic Objectives. It may take some juggling to get it right, so don't worry if it takes a bit of time. The organizational structure of your business must ultimately serve the unique needs of your business.

Begin at the top with the President, Chief Executive Officer, or Managing Director (that will likely be you), and then decide what positions should report directly to him or her. Depending on the size and nature of your business, these will likely be senior management positions for your various business divisions, but how you organize those divisions is still up to you. If two or more positions will be combined into one, put them on your chart as such. It'll give you a more realistic view of your business.

One very useful approach is to write the names of each position on a post-it note. Don't get into position descriptions or who will actually fill the position yet. Now organize your positions on a wall or white board if you have one available according to reporting structure. This makes it easier to play around with the positions and get a visual representation of how you like to see reporting structures work in your company.


Draw your future Organizational Chart in the space below.

Relationship Diagram and Matrix

There are two basic graphical ways to represent the work relationships in your business. You can lay it out in a spreadsheet type matrix, or you can use a diagram. You may choose to develop both types for your business. Or if one of the two is more intuitive for you, you may choose to develop one or the other.

Your Current Relationship Diagram / Matrix

As mentioned earlier, Relationship Diagrams represent the way your people work together to get things done. They help employees identify who serves them and who they serve in the organization.

In business, there are three basic types of working relationships. These are reporting relationships, working relationships and external relationships.

  • Reporting relationships are those represented in your Organizational Chart. They are the relationships managers have with their subordinates. They can be represented with a solid line on your Relationship Diagram (see example below).

  • Working relationships exist anywhere and everywhere in your business. They are the functional relationships employees have with each other. Essentially, they are all the working relationships between employees that are not Reporting Relationships. They can be represented with a dashed line.

  • Teams are typically a group of people with Working Relationships, working together to accomplish a specific task. You can identify team groupings by drawing a circle around the team members, or by grouping them accordingly.

  • External relationships exist with consultants and out sourced positions or departments such as bookkeeping services or advertising agencies. While the agreement is typically with the company as a whole, the relationship is often connected with a key employee such as the VP Finance or the CEO. They can be represented with a dotted line.

relationship diagram

relationship matrix

In this chapter you should have designed, shared and made a plan to review your:

  • Organizational Chart.
  • Future Organizational Chart.