You can use organizational hierarchies to view and report on your business from various perspectives. For example, you can set up one hierarchy for tax, legal, or statutory reporting.
- Go to Organization administration > Organizations > Organization hierarchies.
- Select New.
- In the Name field, type a value, such as ‘Contoso Quality’.
- Select Assign purpose. In the list at the left, find and select a purpose to assign to your organization hierarchy, such as ‘Expenditure internal control’.
- Select Add in the Assigned hierarchies section. In the list, find and select the hierarchy that you just created, ‘Contoso Quality’.
- Select OK. In the list, find and select your hierarchy.
- Select View hierarchy.
- Add organizations, as necessary. To add an organization, select Edit and then select Insert to add the organization.
- Now select Department
- When you are done making changes you can save a draft and/or publish the changes.
AX / Dynamics 365 For Finance and Operations blog 