A new two-level hierarchical approach to control the trolley position and payload swinging of an overhead crane is proposed. At the first level, a simple mathematical pendulum model is investigated considering the time delay due to the use of a vision system. In the second level, a chain model is developed, extending the previous pendulum model considering the vibration of the suspending chain. The relative displacement of the payload is measured with a vision sensor, and the rest of the state-space variables are determined by a collocated observer. The gain parameters related to the state variables of the chain vibration are determined by the use of a pole placement method. The proposed controller is verified by numerical simulation and experimentally on a laboratory test bench.