Business Units and Departments

[shoobadoop]

Hello Community,

At my company, we're trying to get our Business Units and Departments set up correctly. However, our business is one of the largest in America and our organizational structure is completely insane. Each department goes several layers deep. Here's an example:

• Finance
• Revenue & Field Accounting
• Field Accounting
• Time & Attendance Compliance
  
  

Those departments match up with a common business hierarchy like this:

• Officer
• Vice President
• Director
• Manager
  
  

I suppose my question to you all is - what's the point of Departments? Why not just use Business Units exclusively? You can attach a Parent to a Business Unit and you can also type in what level of the hierarchy the Business Unit falls under. It appears to fulfill all the necessary requirements for structuring a Company record. I know that Departments show up on User records but...why? Why shouldn't I just replace Department with Business Unit on the User record? I'm not seeing the benefit of putting all the Officer, Vice President, and Director levels as Business Units and then creating Departments for the Manager level (which is how I assume ServiceNow designed this to work).

Any insight you can all share would be very helpful! I'm guessing Department may be used for a paid plugin or something, but I don't know for sure. Or maybe I'm just totally misunderstanding how Business Units and Departments are supposed to work.

[Allen Andreas]

Hi,

The concept of "Business Units" within ServiceNow can be closely tied to "maturity" of the organization involved. So departments, for the most part, are the basic way a lot of customers are have their organization structured around. As an organization matures and/or grows and/or they're trying to work their way through the Common Service Data Model (CSDM), they may start to account for business units. In your case, maybe due to the size of your company, business units are common to you. To others, especially smaller companies, they are non-exist if their structure is immature.

Now that all that has been said, it depends on how you all are trying to organize things, but from my understanding, business units actually sit above divisions, and then departments listed after that. Business Units themselves, help build the separation, and then the divisions and departments derive from that. You could have many business units within the company structure, but then the divisions and departments related to those business units could be a subset and branch in various ways.

A good example of this is from SAP: https://blogs.sap.com/2014/10/28/the-successfactors-employee-central-organization-structure/

And a picture to help break that down:

Other discussion around the CSDM model 4.0: https://community.servicenow.com/community?id=community_article&sys_id=c981db3a1b018154ccc253da234bc...

And so while the above doesn't necessarily answer all your questions, I hope it help provide some useful information towards a possible structure or at the very least, help explain how Business Units and Departments can be different.

Please mark reply as Helpful/Correct, if applicable. Thanks!

[shoobadoop]

I originally thought that Business Units were the top-level Officer departments (the big ones like Finance, Human Resources, etc.) whereas Departments were everything under them, but then I saw that Business Units could have parent/child relationships with other BU's and be arranged in a hierarchy. Doesn't really make sense for them to only represent big departments when they can have parent/child relationships.

I then looked at Departments and saw pretty much the same thing - more parent/child relationships. So where do you draw the line between a Business Unit and a Department? Does there even need to be a line?

Honestly, with the "Hierarchy Level" field on Business Units making tracking and reporting on the business structure easier (a field that Department doesn't have), I'm at a loss as to what Department is actually useful for. All I could find in the CSDM and the SN KB is that Departments are "a further stratification of your Business Units", but wouldn't child BU records under their parents be a further stratification of the Business Unit? Again, what the heck is the point of Departments? lol

You shared a screenshot of a company being broken down into Business Units, Divisions, and Departments. Is there a Division table in ServiceNow?

[John Zhang1]

A business unit is a separate division within a company that often develops and implements its own processes independently from the core business or brand while still adhering to the overall company policies. Business units are parts of your organization that are in charge of certain operations, such as Finance, HR, IT, and so on.  Business units typically comprise departments and are associated with a company.

A business unit is a separate division within a company that often develops and implements its own processes independently from the core business or brand while still adhering to the overall company policies. Typically, large brands adopt this kind of structure to better organize and track metrics like revenue or costs for each division. Having a structured business unit allows each unit to manage its own profits and costs, which can help companies monitor and reduce their overall costs associated with various department functions.

Departments -Divisions are broken down into one or more Departments. This is more typically represents an Organizational Unit object in SAP and is often the lowest denominator of the organization structure. we refer to the term 'department' as it's used to refer to separate divisions of an organization. Departments within a company can be organized around a number of different parameters - such as: Their specific function. Products. Customers.

Origination Structure:

ServiceNow Data Model

You can see there is no Division table on ServiceNow data model.    Let me know if you have additional questions.

[shoobadoop]

I think I'm starting to understand this better. However, if Business Units are supposed to represent the top-level Officer organizations, why can they have child/parent relationships? I'm still fuzzy as to where to draw the line between where a Department begins and a Business Unit ends. In my original post, I laid out these departments:

• Finance (Chief Officer)
• Revenue & Field Accounting (Vice President)
• Field Accounting (Director)
• Time & Attendance Compliance (Manager)

How would you structure this as Business Units and Departments?