Most of us work in organizations that are vertically and horizontally differentiated.
Horizontal Differentiation: Functions (areas of specialization), such as:
Within each differentiation (function) lies further differentiation, called: High Horizontal Differentiation
Vertical Differentiation: Layers of authority (power pyramid), such as:
Within both horizontal and vertical differentiation is Integration, consisting of cross-functional:
To achieve integration, organizations need Integrators, defined by:
Differentiation, both horizontal and vertical, creates barriers/boundaries (silo organizations). Such organizational structures can (without effective integrators) perpetuate mechanistic, bureaucratic thinking and behavior that prevents process- and team-orientation, innovation and agility.
When analyzing an organization, it is important to identify the extent to which the organization's vertical and horizontal differentiation is blocking its business success.