The first modern organisational chart, created by Daniel McCallum and George Holt Henshaw in 1855 for the New York and Erie Railroad, is both visually appealing and informative. McCallum, the railroad’s superintendent, and Henshaw, a draftsman, designed the chart to improve efficiency and accountability. The chart’s tree structure, with the president at the top and various departments branching off, represents the railroad’s hierarchical structure.
Each branch is proportional to the number of employees in that department, and the chart’s lines indicate the flow of accountability. The chart was designed to solve the problem of inefficiency and lack of responsibility in the rapidly expanding railroad industry.
McCallum’s accompanying report, which detailed the principles of the chart, argued that responsibility should be equivalent to authority, and that each employee should have a single superior. This report also suggested that the railroad’s efficiency could be improved by decentralising decision-making and promoting competition among departments.
The chart and McCallum’s principles had a significant impact on later organisational theory and practice. Despite its age, the chart remains relevant today, reflecting the enduring importance of clear organisational structures and accountability in business.
Go to source article: http://www.slate.com/blogs/the_vault/2014/02/05/the_first_modern_organizational_chart_is_a_thing_of_beauty.html