Let’s say you’ve been asked to create an enterprise organization structure to help the executive team visualize who reports to whom within the company.
It’s a fairly simple task, though not one you’d normally expect to receive as an HR professional—modern HCM technology has made it easy to assemble an organization chart in just seconds.
Sometimes, however, an enterprise organization chart is a little too simple. It might not be telling the whole story.
Often, executives ask for an organization chart when they actually want something that goes a little more in-depth to explain why certain job titles, descriptions, and compensation rates are the way they are.
As an HR professional, it’s important to know how to respond when leadership asks for more context. This is where creating a job structure chart can be more helpful than simply building out an organization structure. In doing so, you’ll be taking the initiative to build something that supports pay transparency and pay equity while combating title fraud.
Whether you’d like to do one or both, we’ll cover everything you need to know.
Building An Enterprise Organization Structure Vs. A Job Structure: What To Know
Before you can get to work building your charts, it’s important to know the difference between these two concepts and why both are important.
What is an enterprise organization structure?
An enterprise organization structure is a chart that outlines the hierarchy of relationships within your company.
It shows who reports to whom and provides a visual representation of individual employees, supervisors, middle management, top management, and executive leadership, in whichever forms they may take at your individual company.
There are different ways to chart organization structures, but a simple example may look like this:
A more complex chart may differentiate between departments, teams, and individual responsibilities.
Building an enterprise organization structure chart is a straightforward prospect.
Simply download the information from your company’s Human Capital Management (HCM) system and use the listed information to fill in the boxes on your hierarchy chart. There is very little strategic thinking involved; it’s more of a copy-and-paste task.
An organization chart can be helpful, but it might not provide all the information your team leader was looking for. It will also have a short life span—it will become outdated as soon as the first reorganization or job change occurs.
For these reasons, we advise making a job structure in addition to an organization structure. In most cases, this is what your executive team was driving at in the first place. By introducing a better way to view roles and titles across the organization, you’ll elevate yourself as a strategic partner who is willing to go the extra mile.
What is a job structure, and how is it different from an organization structure?
A job structure builds a hierarchy of jobs within the company based on factors such as job duties, responsibilities, qualifications, experience, decision-making authority, span of control, visibility, and impact.
It’s less about who reports to whom and more about the responsibilities of one job relative to the others within the company. These details provide the reasons behind the salary each position earns and provides a basis to align equitable jobs
Take the following job structure chart as an example:
In the organization structure, the Executive Assistant sits just below the CEO. This gives the impression that the Executive Assistant must be the second-most powerful person within the company.
If you look at the job structure, however, you’ll notice that the Executive Assistant actually falls into the same global grade tier as the Assistant Controller, HRIS Specialist, and Compensation Manager, who all fall much lower on the organization structure. That’s because the actual job duties of the Executive Assistant within this example company are more on par with those global grade 18 positions than with the top-level management positions of CFO and Chief HR Officer.
This kind of discrepancy can cause some friction when it comes to planning salaries for each position.
If an employee in one role wonders why someone else makes much more money despite appearing close together on the organization hierarchy, a job structure can explain which job roles are different and therefore contribute to a different level of compensation. This information can help HR and management have difficult conversations more easily and maintain a high level of pay transparency.
Creating a job structure might appear daunting, yet the enduring advantages surpass the time commitment by far.
Plus, as an HR professional, you’re well-equipped to track down (or research) the necessary information—such as job duties, management capacity, and comparable salaries—to place each job title in its proper tier. You’ll also be able to collaborate with leadership to validate your findings, which is helpful and rewarding on several fronts.
Need some help with organizational design? Turn to MorganHR.
Even if you research each job title and their roles, responsibilities, and compensation in the wider market, it isn’t always easy to assign them into a clear hierarchy. That’s where MorganHR consultants can help.
Our experts will guide you through the process of designing roles within your organization while sticking to best practices and encouraging the engagement of stakeholders. This will keep everyone—from entry level employees all the way up to the C-suite—on the same page. The end result will be a job structure that aids in decision-making for new positions, fosters career advancement, optimizes the organization’s size, and supports pay transparency and equity initiatives.
Reach out to MorganHR to speak with our team of expert consultants.
