Organisation Charts

• An organisational chart is a diagram that shows the formal structure of an organisation. An organisational chart shows:

• The relationship between staff • Who has authority • Who is in charge of the organisation and

each department • The chain of command and line of

communication

Oban High School Organisation Chart

Mr Bain

Mrs Pupillo Mr Cameron Mrs Leitch Mrs Lawson

Mr Milligan

Teachers

CHAIRMAN

MANAGING DIRECTOR

FINANCE ADMIN OPERATIONS INCLUDING MARKETING

CAR

RENTAL

CORPORATE

and

PRIVATE SALES

MAJOR ACCOUNTS

Eg LOCAL

AUTHORITY SALES

ARNOLD CLARK ORGANISATION CHART

Arnold Clark has functional departments for Finance, Administration and Operations.

It has different departments for different types of products it offers eg Car Rental and Sales.

It also has two departments that are divided according to customer grouping. One department targets corporate and private customers and another for major accounts suck as local authorities.

Chart adapted from www.arnoldclarkfinance.co.uk

For discussion

Forms of organisation structure

• The management structure in an organisation is another essential factor in its success. Why…

• The structure:– defines how the organisation operates– defines the role(s) of individuals within the

organisations and what authority they have– defines the relationship between groups and

between individuals– channels the activities within the organisation

towards the goals of the organisation– helps to make best use of scarce resources

Organisation Charts

H R S ta ff

P e rson n e l O ffice r

H R M an a g er

F in an ce S ta ff

A ccou n ta n ts

F in an ce M a na g er

O p era tion s S ta ff

W o rks Fo re m an

O p era tion s M a na g er

M a rke tin g S ta ff

M a rke tin g S u pe rv iso rs

M a rke tin g M a na g er

A ss ista n t G e ne ra l M a na g erT yp e t it le h e re

G e ne ra l M a na g er

An organisation chart shows the formal structure of an organisation and clearly shows:

• lines of communication – 2-way from top to bottom• lines of authority – between superiors and subordinates• lines of responsibility – accountability for tasks/duties• span of control – no of people a manager is directly responsible for

Organisational Charts

ADVANTAGES• Clear identification of each individual• Can spot communication problems• Individuals can see their position,

authority or responsibility• Can pinpoint need for specialists• Shows relationship between

departments• Shows chain of command

Organisation Charts

DISADVANTAGES• Difficult to identify extent of

manger’s authority• Doesn’t show informal relationships

Organisation Charts

USED BY• New members of staff - induction• Existing members of staff –

identification of position within firm, line manager, etc

• Customers and suppliers - identification functional areas and contacts

• Senior managers - overview of business and identification of problem areas