A company hierarchy chart is the org chart read for its depth rather than its departments: how many layers there are between the person at the top and the person doing the work. That number decides how long a decision takes and how many managers you are paying for, and it is arithmetic rather than philosophy. This page works it out. On the worked example four leaders reporting to the chief executive reach 28 people within two layers and 228 within three, so a company of 120 sits inside four layers and needs 15 managers at a span of seven; 105 people have nobody reporting to them at all.
The layer count, worked from the top
Multiply the people reporting to the chief executive by the span of control to get each layer's reach: four leaders reach 28 in two layers, 228 in three. Your headcount falls inside one of those and that is your layer count. It is worth doing before a reorganisation rather than after, because a fifth layer is usually added by accident, one promotion at a time, and is very hard to remove once every box in it has a name.
The manager count, worked from the span
Headcount divided by the span plus one gives the managers the structure implies: 15 for 120 people at a span of seven, 20 at a span of five. Those five managers are five salaries and, more importantly, five people not doing the work they were hired for. The sheet prints both numbers together so the trade between span and layers is a decision rather than a surprise. One outside marker is worth knowing: the U.S. Office of Personnel Management credits a position as supervisory under its General Schedule Supervisory Guide only where it directs the work of at least three employees, which is a useful floor when a box on your chart has one report under it.
What a chart with the wrong depth costs
Too many layers and a decision passes through four people who each add a week; too few and every manager has fifteen reports and none of them are managed. The honest test is the one number the chart cannot hide: 105 of 120 people have nobody reporting to them, so 87% of the company is the work and 13% is the structure around it. If that share climbs past a fifth, the hierarchy is the thing that grew.
Questions people ask about company hierarchy chart
How many layers should a 100-person company have?
Usually three or four, depending on how wide the top is. Put your own headcount, span and top-layer count in and the sheet answers for your company rather than an average one.
Is a hierarchy chart different from an org chart?
It is the same chart read for depth. People search for a hierarchy chart when the question is about levels rather than departments.
Should job levels be on the chart?
Only if pay bands are public. Otherwise levels belong on the profile behind the box, where the people who need them can find them.