Vertical and Horizontal Differentiation | Organizational Design | MeanThat

Summary

This video script discusses the concepts of vertical and horizontal differentiation within a restaurant's organizational structure. It uses a pyramid model to illustrate the hierarchy, with roles like bartenders, servers, dishwashers, chefs, and kitchen assistants at the base, managed by dining and kitchen managers. The script explains that horizontal differentiation is about grouping employees by their tasks, while vertical differentiation is about authority and responsibility, with higher levels in the pyramid having broader oversight and decision-making power.

Takeaways

• 🏢 The video script discusses the concepts of vertical and horizontal differentiation within an organizational structure, using a restaurant as an example.
• 📈 Horizontal differentiation refers to the grouping of employees and resources based on their tasks or functions.
• 🔺 Vertical differentiation is about the hierarchical arrangement of employees and resources based on their authority and responsibility within the organization.
• 👤 The script outlines various roles within a restaurant, from bartenders and servers to managers and owners, illustrating how they fit into the horizontal and vertical dimensions.
• 🍸 Bartenders, servers, dishwashers, chefs, and kitchen assistants are considered lower-level employees with specific tasks and limited authority.
• 👩‍🍳 Kitchen managers and dining room managers have authority over their respective areas and report to higher-level management, showcasing vertical differentiation.
• 👔 The restaurant manager has overarching responsibility and authority, overseeing the entire restaurant's operations and staff.
• 🏛️ The owner is at the top of the hierarchy, often overseeing multiple restaurants and interacting primarily with the restaurant manager.
• 🔄 The video script uses a pyramid structure to visually represent the hierarchy and differentiation within the restaurant's organizational structure.
• 📊 Understanding horizontal and vertical differentiation is crucial for effective management, as it helps in assigning roles, responsibilities, and authority within an organization.

Q & A

What is the purpose of the video?

The purpose of the video is to explain the concepts of vertical and horizontal differentiation within an organization, using the example of a restaurant's hierarchical structure.

What does the term 'horizontal differentiation' refer to in the context of the video?

Horizontal differentiation refers to the grouping of employees and resources according to their tasks, which is demonstrated by the different roles and responsibilities of employees such as bartenders, servers, dishwashers, chefs, and kitchen assistants.

How is the term 'vertical differentiation' explained in the video?

Vertical differentiation is explained as the grouping of people and resources according to their authority and responsibility within the organization. It is illustrated by the hierarchy from lower-level employees to managers, restaurant managers, and finally the owner.

What is the role of a bartender in the restaurant hierarchy described in the video?

In the restaurant hierarchy, a bartender is a lower-level employee responsible for serving drinks and is placed under the dining room manager.

Who is the server's supervisor in the restaurant's organizational structure?

The server's supervisor in the restaurant's organizational structure is the dining room manager.

What is the difference between the tasks of a dishwasher and a chef according to horizontal differentiation?

According to horizontal differentiation, a dishwasher is responsible solely for washing dishes, while a chef is responsible for cooking. This difference in tasks is what distinguishes their roles within the organization.

Who has authority over the kitchen staff in the restaurant hierarchy?

The kitchen manager has authority over the kitchen staff, including chefs, dishwashers, and kitchen assistants.

What is the role of the dining room manager in terms of vertical differentiation?

In terms of vertical differentiation, the dining room manager has authority and responsibility over the dining room staff, which includes bartenders and servers, and reports to the restaurant manager.

How does the restaurant manager's role differ from that of the kitchen and dining room managers?

The restaurant manager has a broader scope of authority and responsibility, overseeing the entire restaurant including both the kitchen and dining room operations, whereas the kitchen and dining room managers focus on their respective areas.

What is the significance of the owner's position in the restaurant's hierarchy?

The owner's position at the top of the hierarchy signifies ultimate authority and responsibility for the entire business. The owner may have multiple restaurants and communicates with the restaurant manager to oversee operations.

How does the video script illustrate the concept of authority in a hierarchical structure?

The video script illustrates the concept of authority by showing how each level of the hierarchy has increasing responsibility and decision-making power, from individual tasks at the lower levels to overall management and ownership at the top.

Outlines

00:00

🍽️ Understanding Vertical and Horizontal Differentiation

This paragraph introduces the concepts of vertical and horizontal differentiation within an organization, using a restaurant as an example. The speaker designs a hierarchical structure, placing employees such as bartenders, servers, dishwashers, chefs, kitchen assistants, managers, and owners in a pyramid. The horizontal dimension represents the grouping of employees and resources based on their tasks, moving from bartenders to servers, then to dishwashers, chefs, and kitchen assistants. Each role has distinct tasks, illustrating horizontal differentiation. The vertical dimension, on the other hand, represents the grouping based on authority, with lower-level employees at the bottom and the owner at the top, showing the chain of command and responsibility within the organization.

05:02

🔍 Exploring Authority and Responsibility in Organizational Structure

In this paragraph, the focus is on the vertical differentiation within the restaurant's organizational structure. It explains that each level of the hierarchy has different levels of authority and responsibility. Lower-level employees like bartenders, servers, dishwashers, chefs, and kitchen assistants are responsible for specific tasks within their roles. As one moves up the hierarchy, the authority and responsibility increase. Kitchen and dining room managers oversee the employees under them, while the restaurant manager has authority over the entire establishment. The owner, at the top, has the ultimate responsibility and authority, often overseeing multiple restaurants. This paragraph emphasizes the importance of understanding the roles and responsibilities at different levels of an organization's structure.

Keywords

💡Vertical Differentiation

Vertical differentiation refers to the hierarchical structure within an organization where authority and responsibility increase as one moves up the levels. In the video, this concept is illustrated by the restaurant's hierarchy, where lower-level employees like bartenders and dishwashers have limited responsibilities, while higher-level positions like the restaurant manager and owner have broader authority and control over the entire establishment.

💡Horizontal Differentiation

Horizontal differentiation is about grouping employees and resources based on their tasks within the same level of an organization. The video uses the example of a restaurant where bartenders, servers, dishwashers, chefs, and kitchen assistants are grouped according to their specific roles and tasks, which are all different but operate at the same level within the organizational structure.

💡Organizational Structure

Organizational structure defines how tasks are distributed and responsibilities are assigned within an entity. In the context of the video, the restaurant's structure is depicted as a pyramid, with various roles like bartenders, servers, and managers each having their place, illustrating a clear division of labor and authority.

💡Authority

Authority in an organizational context refers to the power to make decisions and command obedience. The video script discusses how authority is distributed vertically, with higher positions having more authority. For instance, the restaurant manager has authority over the entire restaurant, while individual bartenders have authority only over their specific tasks.

💡Responsibility

Responsibility denotes the duties or tasks that individuals are expected to perform in their roles. The video uses the restaurant example to show how responsibilities vary with the level of the position, with lower-level employees having more specific, limited duties, and higher-level employees having broader, more encompassing responsibilities.

💡Tasks

Tasks are the specific activities that employees are required to perform in their roles. In the video, tasks are used to differentiate roles horizontally, with each position like bartender, server, or dishwasher having distinct tasks that contribute to the overall functioning of the restaurant.

💡Pyramid Structure

A pyramid structure is a type of organizational hierarchy that is depicted in the video, where the base consists of many lower-level employees, and the number of people decreases as one moves up the levels to the top, which is occupied by the owner. This structure is used to visually represent the distribution of authority and tasks within the restaurant.

💡Bartender

A bartender is a specific role within the restaurant hierarchy discussed in the video, responsible for preparing and serving alcoholic beverages. The bartender's position is used to illustrate horizontal differentiation, as they have a distinct set of tasks compared to other roles like servers or dishwashers.

💡Server

A server in the context of the video is an employee who takes customers' orders and serves food and beverages. The server's role is part of the horizontal differentiation, as they have different tasks compared to other employees like bartenders or dishwashers, yet operate at the same level within the organizational structure.

💡Dishwasher

A dishwasher in the video is an employee whose primary task is to clean dishes and kitchen utensils. This role exemplifies horizontal differentiation as it has a specific set of tasks that are different from those of other roles within the same level of the organization, such as bartending or serving.

💡Chef

A chef, as mentioned in the video, is a professional cook responsible for the preparation of meals. The chef's role is part of the horizontal differentiation, highlighting the specialized tasks required in this position compared to other roles within the restaurant, such as bartending or dishwashing.

Highlights

Introduction to the concept of vertical and horizontal differentiation in a business context.

Designing a restaurant hierarchy to illustrate organizational structure.

Positioning of a bartender in the restaurant hierarchy.

Server's placement in the hierarchy and their relationship to the dining room manager.

Dishwasher's role and its position in the organizational pyramid.

Chef's role and how it fits within the kitchen hierarchy.

Kitchen assistant's responsibilities and their place in the hierarchy.

Kitchen manager's authority and its position above kitchen staff.

Dining room manager's role and its position in the hierarchy.

Restaurant manager's overarching responsibilities and authority.

Inclusion of the owner in the hierarchy and their strategic role.

Explanation of horizontal differentiation based on tasks.

Illustration of how tasks differ across horizontal levels in the hierarchy.

Concept of vertical differentiation based on authority.

Difference in responsibilities and authority as one moves up the vertical hierarchy.

The restaurant manager's role in overseeing the entire restaurant operation.

The owner's strategic position and interaction with the restaurant manager.

Summary of horizontal differentiation focusing on task grouping.

Summary of vertical differentiation focusing on authority and responsibility.

Transcripts

find all our courses admin dead calm in

this video we are going to learn what

does it mean to say vertical and

horizontal differentiation but at first

in order to do that we are going to

design sort of a restaurant I have

written down a rows or or our employees

that we are going to have in a

restaurant and we should order them into

this nice pyramid this alterative

pyramid so let's see we have we have it

first we have a bartender so we have a

bartender so what smooth bartender

somewhere over here it should be

probably on the bottom now we have a

server well it most likely will be

somewhere next to it so let's give it

here now we have a dishwasher so let's

do it again somewhere over here then we

have a chip and we have a chef then we

still have this this workforce so it's

going to be kitchen assistant and then

we are moving now we already have a

manager's so let's see a kitchen manager

we have a bartender or server dishwasher

chef kitchen assistant hmm so it seems

like a kitchen manager should be

somewhere somewhere about somewhere

about here somewhere about here and then

we have a dining room manager and that

should be somewhere about here now we

have a restaurant manager now we have a

restaurant manager and I would even add

one more I would even add owner here and

you will see why later on so older over

here now let's draw it let's draw it we

have a bartender's which are responsible

under the dining room manager server as

well then dishwasher chef and kitchen

assistant are responsible under the

kitchen manager and then our dining room

manager and kitchen manager are

responsible under restaurant manager and

then there is some owner who owns

several restaurants and in

of them he assigned a restaurant manager

so he's just communicating with this one

person so there we have it we have drawn

a sort of hierarchical structure within

this organization and when we look at it

we start to see two dimensions we have a

horizontal dimension which is over which

is over here so let me just call it for

now let's go it just horizontal

horizontal horizontal dimension and then

we have another one which is over here

and that is of course a vertical

dimension so let me for now call it just

vertical vertical now let's think what

difference when we go horizontally so we

start over here and we first have a

bartender then we move further and we

have a server then we move further and

we have a dishwasher then we move

further and I have a chip and finally a

kitchen assistant what differs is tasks

so here we are moving along the tasks so

here we have a tasks and that is what we

call horizontal differentiation so

horizontal differentiation

differentiation it's horizontal

differentiation is basically grouping

employees and resources according to

their tasks so we are grouping we are

grouping according to according

according to two tasks and that is the

idea behind the horizontal

differentiation even if we go one level

up and are moving over here we have a

dining room manager and then we have a

kitchen manager so still it's different

kind of a task that person is is holding

now when we go to vertical dimension

let's try to see it we have it first

this is sort of and

to use a brush so we have these sort of

lower-level employees then we have a

managers and then we have a restaurant

manager and finally we have an owner

well what the difference is what we call

a out Dority so according to out Dority

so and let me write it down here out

thority so we are again grouping sort of

people and resources according to their

out Dority according according to

alternate because these people right

over here are responsible just for a

very very small part of a restaurant

bartenders are responsible only for

their bar servers are responsible only

for serving customers dishwashers only

for washing dishes chefs only for

cooking and assistants only for

assisting during cooking but when you

move one level up then the people over

there have much more of a responsibility

and much more of an authority kitchen

manager has an authority over all these

guys over here and dining room manager

has authority over the world dining room

and then when we move even one level up

the in the vertical dimension and we are

we are doing the vertical

differentiation differentiation then you

see that the restaurant manager has an

authority and responsibility over the

wall restaurant and that is the wall

trick the horizontal differentiation is

talking about grouping of people and

resources according to their tasks and

then in the vertical differentiation we

are grouping and differentiating

according to all thority