organizational chart for small business

Organizational Chart for Small Business: Definition and Examples

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  • Post last modified:January 15, 2023
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An organizational chart for small business represents a company’s structure. It shows the roles and relationships of its employees. 

The chart is valuable for new and established businesses as it defines roles and responsibilities, improves communication and collaboration, and increases efficiency and productivity.

If you’re wondering how you can make an organizational chart for your small business, we’re here to help. 

In this post, we’ll talk about organizational charts for small businesses, their benefits, and their types. We’ll also show you some examples and answer the most frequently asked questions about them.

What Is an Organizational Chart for Small Businesses?

what is an organizational chart for small business

An organizational chart for small businesses, also known as an organization chart, illustrates the internal structure of a company. This includes the relationships between different positions and roles. 

It also refers to a hierarchical representation of the chain of command within an organization, where the highest-level position, such as the CEO or owner, sits at the top. Meanwhile, the lower-level positions, such as managers and employees, sit below.

An organizational chart is a powerful tool that helps small businesses understand the company’s overall structure. It also shows the roles and responsibilities of each employee, as well as the lines of communication and reporting. 

Additionally, an organizational chart helps new and established businesses clarify the organizational structure. As a result, it improves communication and collaboration, increases efficiency and productivity, and helps executives make better-informed decisions.

An organizational chart also helps small businesses like bakeries improve the performance of employees by providing clear expectations and goals. This, in turn, can lead to an improvement in the company’s overall performance. Lastly, the chart helps organize the company’s structure, making it more effective and productive.

Does My Small Business Need an Organizational Chart?

Yes, your small business needs an organizational chart. 

An organizational chart defines the roles and responsibilities of each employee, which improves communication and collaboration within the company. It also helps new employees understand the company’s structure and where they fit in. 

Additionally, an organizational chart identifies areas where there may be overlap or gaps in responsibilities, allowing for more efficient use of resources. It can also help management make better decisions by clearly understanding who is responsible for different tasks and projects. 

In addition, it can create a transparent chain of command and make it easier for management to delegate tasks and hold employees accountable for their actions. 

Moreover, having an organizational chart presents a more professional image to clients and partners. It shows that the company has a clear structure and organization, which can instill confidence in potential clients and partners.

Types of Organizational Charts

types of organizational chart for small business

Here are the types of organizational charts small businesses can use: 

1. Hierarchical chart

This is the most common type of organizational chart, which shows the relationships between different levels of management and employees.

2. Functional chart

This type of chart shows the different departments within a company and how they relate to each other. 

3. Divisional chart

This type of chart shows how different company divisions are related.

4. Matrix chart

This chart shows how employees get assigned to different projects or teams within a company.

5. Flat chart

This type of chart shows a simple and flat company structure without any levels of management.

6. Line-and-staff chart

This type of chart shows how different support functions relate to the main line of management.

7. Network chart

This chart shows the relationships between different teams or departments in a decentralized organizational structure.

8. Process-oriented chart

This type of chart shows the flow of work and responsibilities within a company.

9. Strategic chart

This chart shows the relationships between different business units and how they contribute to a company’s overall strategy.

10. Hybrid chart

This type of chart shows a combination of different types of organizational charts.

How to Create an Organizational Chart for Small Business

organizational chart for small businesses

1. Define the structure of your organization.

Identify key roles and responsibilities within your baking business, including top-level positions and department heads. This will help outline the primary decision-making levels and who reports to whom.

2. Gather information.

Obtain names, job titles, and contact information of all employees in the organization. This is necessary for creating an accurate and up-to-date chart.

3. Choose software or template.

Select a method for creating the chart, such as diagramming software or a pre-made template. Some popular options include Microsoft Visio, SmartDraw, and Lucidchart.

4. Start with the top-level positions.

Begin by placing top-level positions on the chart, such as the CEO and department heads. These positions should be at the top of the chart, with lines connecting them to the lower-level positions.

5. Add lower-level positions.

Add positions below the top-level positions, such as managers and team members. Then, connect them to the appropriate higher-level role. This will help show the organization’s hierarchy and how decisions flow from the top to the bottom.

6. Include departmental structure.

Show the structure of each department by connecting the department head to the team members and managers within that department. This will help demonstrate how each department functions independently and how they all come together to support the overall business.

7. Customize the chart.

Personalize the chart with your company’s logo, colors, and additional information. This will help to make the chart more visually appealing and professional.

8. Review and finalize.

Examine the chart to ensure all positions and connections are accurate. Then, make any necessary adjustments. This ensures the chart is accurate and up-to-date.

9. Share and distribute the chart.

Share the chart with employees and relevant parties. Doing so makes the chart easily accessible to all organization members. It will also ensure that everyone understands the organization’s structure and how they fit into it.

Organizational Chart for Small Business Examples

1. Product Organizational Chart

Product Organizational Chart
Source: Visme

If your company deals with multiple products, you might have different teams for each product. Use this small business organizational chart to show which team holds responsibility for a certain product.

This example makes your business preparations and operations transparent. It also makes your employees know more about that what they collectively build.

2. Sales Department Organizational Chart

Sales Department Organizational Chart
Source: Visme

The structure of a sales force plays a significant role in its success, as sales generate revenue and help the business grow. 

The example shows the most common sales structure. The model below features a sales director, regional sales manager, distribution manager, sales supervisor, channel supervisor, and sales representative.

3. Small Photographic Organizational Chart

Small Photographic Organizational Chart
Source: Visme

Enhance your organizational chart by adding pictures and giving it a more personal touch.

Make a photographic organizational chart using this sample. This chart can be a valuable tool for sellers, clients, job applicants, new hires, and others who need to be more familiar with your team.

4. Editorial Department Organizational Chart

Editorial Department Organizational Chart
Source: Visme

A successful newspaper organization’s entire business depends on its editorial department’s effectiveness.

The editorial department handles everything from gathering news. It also picks which news and features should be published in the newspaper. Additionally, the department does the editing and laying out of the report for print.

5. Small Business Organizational Chart

Small Business Organizational Chart
Source: Visme

Use this example to create a perfect organizational chart for your small business (e.g., cake business). The chart features a hierarchical structure where the owner occupies the top position, followed by the managers and assistant managers.

6. Project Team Organizational Chart

Project Team Organizational Chart
Source: Visme

The success of your project depends on your team’s strength. Misaligned project management teams can negatively impact the outcome of a project. Therefore, create a project team organizational chart to determine the hierarchy and authority of individuals involved in your project.

The project team organizational chart sample also lets you define each member’s function and reporting relationships. Additionally, the chart allows you to understand which employees are a part of which team.

7. Law Firm Organizational Chart

Law Firm Organizational Chart
Source: Visme

Consider this organizational chart sample if you are a law firm business owner. It will also help you structure your hierarchy of command efficiently.

The sample features the president, board of directors, legal manager, non-legal manager, general secretary, treasury officer, and more.

8. Cross-Functional Organizational Chart

Cross-Functional Organizational Chart
Source: Visme

Does your team feature diverse talent and responsibilities separated into different units, departments, or teams?

Then this cross-functional organizational chart will be helpful for you. Use this sample to create a perfect org chart that will assist all your teams and departments to work together efficiently.

9. Team Organizational Chart

Team Organizational Chart
Source: Visme

Begin with the horizontal, simplistic organizational chart template. In this template, the CEO occupies the top position. Then, you can see the directors, managers, and other employees. This template can also enhance your “Meet the Team” page.

10. Non-Profit Organizational Chart

Nonprofit Organizational Chart
Source: Visme

Nonprofits, like for-profit organizations, use organizational charts to highlight the hierarchy within the organization. It will help you define staff roles and responsibilities. It also highlights relationships to make the team more productive and efficient.

Additionally, an organizational chart helps you market your nonprofit internally and externally. Use this sample to do the same.

Frequently Asked Questions

How do I create a small business organizational chart?

Here’s how to create a small business organizational chart:

1. Define the structure of your organization by identifying key roles and responsibilities.
2. Gather employee information.
3. Choose software or template.
4. Start with top-level positions.
5. Add lower-level positions.
6. Include departmental structure.
7. Customize the chart.
8. Review and finalize.
9. Share and distribute the chart.

What is the best organizational structure for a small business?

The best organizational structure for a small business is the functional reporting structure. It groups employees together based on their function or role within the organization. For example, the sales team works in one department, the IT team in another, and the finance team works in a third group. Each department has responsibilities and goals that align with the organization’s overall objectives.

What is the simplest organizational structure?

The simplest organizational structure is the line structure. Its authority flows from top to bottom linearly. Unlike other systems, specialized and supportive services do not exist in these organizations. 
The chain of command is transparent, and each department head controls their respective departments. This structure is often used in small businesses or organizations with a single product or service.

What is the simplest business organization?

The simplest business organization is a sole proprietorship. Under this business structure, an individual owns and runs the business for their benefit. Hence, the owner is fully responsible for all decisions, debts, and legal issues. This structure is standard for small businesses, like freelancers, small retail shops, or consulting firms.

What are the 5 basic business structures?

The five basic business structures are sole proprietorship, partnership, corporation, S corporation, and limited liability company.

Conclusion

Creating an organizational chart for a small business is a valuable tool for outlining the structure and hierarchy of the company. It also helps you understand the flow of decision-making and the scope of work of each department. 

Are you ready to make an organizational chart for your food business? Print or bookmark this guide now! Happy organizing! 

About HICAPS

Over the years, HICAPS has helped bakers and businesses make delicious products by offering ingredients like ChiffonAide Cake Oil, Magic Whizk Whipping Cream, Red Velvet Flavor Emulco, and Instabake Brownie Mix

HICAPS also provides tools and resources to valued partners such as the free “How to Increase Your Sales Amidst the Pandemic” E-book and free dealer locator that helps look for baking ingredients near me

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