Why does differentiation occur in an organization? Distinguish between vertical and horizontal differentiation. 2.Draw an organizational chart of your business school or college. Outline the major roles and functions. How differentiated is it? Do you think the distribution of authority and division of labor is appropriate? 3.What factors determine the balance between centralization and decentralization and between standardization and mutual adjustment? 4.Under what conditions is an organization likely to prefer (a) a mechanistic structure, (b) an organic structure, or (c) elements of both?