An organisation tree is a way of representing the hierarchical nature of reporting. Every employee in the organisation, except one, is a subordinate to an other employee. In an organisation, the hierarchy usually consists of a singular/group power at the top with subsequent levels of power beneath.
Members of a hierarchical Organizational Structure mainly communicate with their immediate superior and with their immediate subordinates. Structuring organisations in this way is useful partly because it can reduce the communication overhead by limiting information flow.