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Vertical distance and its effect on

interpersonal relationships

University of Groningen Faculty of Economics and Business

MSc Business Administration Organizational & Management Control

Author information Name: Konijn, M.M. Study: MSc BA - O&MC Student Nr: S2490366 Email: m.m.konijn@student.rug.nl Supervisor: Mangin, N.J.B.

Co-assessor: Heijes, C.P.A.

Date: 20 July 2017

Words: 14,221 (incl. references)

Article information

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Contents

1. Introduction ... 2 2. Literature review ... 4 2.1 Operational performance ... 4 2.2 Quality of relationships ... 5 2.3 Interpersonal relationships ... 6 2.4 Modes of communication ... 9 3. Methodology ... 10 3.1 Research strategy ... 10

3.2 Population and sample ... 10

3.3 Data collection ... 14

3.4 Data Analysis ... 14

3.5 Controllability, reliability, and validity ... 15

4. Results ... 17

4.1 The interpersonal relationship ... 17

4.2 Communication ... 20

4.3 Quality of the relationship... 25

5. Discussion ... 30

6. Conclusion ... 34

References ... 37

Appendices ... 41

Appendix 1, Interview guide ... 41

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Abstract

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1. Introduction

Research recently revealed that 84 per cent of the employees values its colleagues at the work floor, they are gold to them. Additionally, even 43 per cent of the employees value their colleagues so much, that they have also become important for them outside the office as well. 42 per cent of the sample said to have developed true friendships at the work floor, and 15 per cent even had a relationship with a colleague (Metro, 2017). Different types of interpersonal relationships can be found on the work floor, as can be seen in the article. From daily contact at the work floor, to lovers outside the office. Part of the interpersonal relationship is personal communication (Barnes et al., 2015). Communication can happen in various modes, such as face-to-face, computer-mediated communication, phone calls, notes, etc. (Ocker et al., 2015; Ochsman & Chapanis, 1974). Each of these modes has its own value and personal touch to it, which can impact the interpersonal relationship to be either more or less intense.

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interpersonal relationships with the personnel, to improve the performance of the organization. This gap in the literature leads to the following research question:

“What is the effect of hierarchical distance on the interpersonal relationships on the work floor of an organization?”

The research question will be covered in a qualitative research, since that is the most appropriate method to explore this topic and add to the current relationship theory. The literature review covers the aspects which matter such as characteristics of the operational performance, interpersonal relationship quality, the interpersonal relationship itself, and communication. For this study two fast food restaurant chains will be used, both with two restaurants, resulting into four restaurants. From both chains, several people will be interviewed, such as the employees, restaurant managers, franchisees, and the franchisor. These are the different positions in the hierarchy of this research (Croonen & Broekhuizen, 2017). Interviews will be conducted via a semi structured interview guide which focuses on several different topics varying from different expectations between interviewees, to interpersonal relationships, and from conflicts to electronic feedback. After the data collection, the transcripts will be formed and data will be analyzed by using NVivo, a qualitative data analysis software tool. From this analysis, a few things came forward. Firstly, more vertical distance on the work floor results in a less interpersonal relationship. And secondly, managers are more involved in building interpersonal relationships on the work floor than the employees are.

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2. Literature review

This chapter reviews the existing literature available on operational performance, quality of relationships, interpersonal relationships, and modes of communication to answer the research question. These four topics are all connected to each other, however, the direct or indirect effects they have on the operational performance are not clear yet.

2.1 Operational performance

The general definition of operational performance is “the firm’s performance measured against standard

or prescribed indicators of effectiveness, efficiency, and environmental responsibility such as, cycle time, productivity, waste reduction and regulatory compliance” (Business Dictionary, 2017). Operational

performance includes all the daily activities from keeping the workplace clean, satisfying customers, employing people, make every action in the firm as smooth as possible. Therefore, operational performance is evaluated in this research as the satisfaction of managers with their employees, and how this could be improved. Customers need to be helped as fast and as good as possible, and without customers, a business would not exist. Therefore, it is important that the operational performance of a firm is sufficient.

Communication in organizations, or actions in organizations can change the output in the operational performance. “Effective organizational communication enhances overall organizational performance in

terms of productivity and member satisfaction” (Cushman & Cahn Jr., 1985). Moreover, also according to

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(Gerstner & Day, 1997; Ilies et al. 2007; Zhang et al., 2012). Barnes et al. (2015) mention that higher levels of relationship quality, in all three elements, will lead to higher financial performance, which is also part of the operational performance. However, the other way around, operational performance leading to the financial performance, is possible as well. One can see that several characteristics and factors of interpersonal relationships have been identified, however, what the impact of these factors and characteristics is on the interpersonal relationships and the operational performance of firms is still to be explored.

2.2 Quality of relationships

From the previous paragraph, it was mentioned that the quality of a relationship affects the performance. However, what is the quality of relationships? The quality of relationships depends on different factors, and these can either increase or decrease the quality. In this paragraph, three elements of relationship quality will be elaborated.

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things are going. For example, if goals are reached, and no problems arise. Therefore, this is can be seen as the outcome of a relationship, as mentioned by Duarte & Davies (2004).

In a significant amount of researches, trust has been mentioned as a key indicator of relationship quality between agents (Doney & Cannon, 1997; Morgan & Hunt, 1994), which is why it will be used as a concept in this research as well. Trust can be defined as the willingness of a trustor to be vulnerable to the actions of a trustee based on the expectation that the trustee will perform a particular action (Mayer et al., 1995). Both trust in the receiving agent as well as the sending agent is of value. Trust is key when giving people responsibilities on the work floor, so managers giving tasks to employees, but also franchisees giving tasks to managers. Colquitt et al. (2007) mention that with the absence of any formal or incomplete contract of specified repayment schedule, a built-in vulnerability will be created, with one party risking the possibility that the other will fail to meet obligations. In this research, most relationships are established via a contract, which would give them more security in the first place. Interpersonal attributes show to affect interfirm trust and relationship quality, which in turn lead to enhanced financial performance (Barnes et al., 2015). The building of trust through personal communication, personal credibility and personal affection, is often described as being at the heart of interfirm relationships (Moorman et al., 1992). Next to this, trust also is the key of enhancing the quality of relationships between agents, in terms of cooperation, commitment and satisfaction (Seppänen et al., 2007). Each three of these elements is positively related to financial performance (Barnes et al., 2015). Cooperation is needed for a good working relationship to achieve a company’s goals, whereas commitment is required for enhancing these relationships, and the satisfaction positively impacts the working relationships and the constructive atmosphere. Therefore, a higher level of relationship quality, defined by these dimensions, will lead to a better performance (Barnes et al., 2015).

2.3 Interpersonal relationships

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performance of a firm. But how do we define interpersonal relationships? At a firm, a new employee bonds with the firm through a contract. The contractual relationship is the legal contract which binds two or more individuals/parties (Business dictionary, 2017). Interpersonal relationships often start with a connection, in this case the contractual relationship in which both of you work at the same place (Moir, 1968). However, to understand the quality of the relationship, we need to go beyond the contractual side of the relationship and dig into the interpersonal aspects. Additionally, interpersonal relationships also fit the scope of the researcher better, since contracts might contain sensitive information, and be hard to get hold on. It is important that we define the concept of interpersonal relationship clearly. In the book of Kelley (1979) he talks about close personal relationships as lovers, marriage partners, best friends, and persons who work closely together. Whereas most research in the past was focused on the contractual aspect of a relationship (Subramanian et al., 2015) or sometimes even the structural aspect like franchisee, licensee, acquisition, merger, etc. In this study, it is essential to find out what type of relationship is connecting the agents, and what motivates them to reach mutual, optimal goals. This way, in the end, the firm’s performance can be improved.

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face to face meetings or Skype meetings. On the other hand, examples of written or computer-mediated communication are mails, letters, fax, text messages, WhatsApp or other social media, notes, etc. (Ochsman & Chapanis, 1974; Ocker et al., 2015). Therefore, the interpersonal relationship might be affected by the communication modes, which will be elaborated in paragraph 2.4.

The second element of Barnes et al. (2015), personal credibility, can also be found back in the work of Colquitt et al. (2007), and according to Barnes et al. (2015) it positively influences interfirm trust. Personal credibility is a person’s ability to rely on someone else, because that person is considered credible or competent (Barnes et al. 2015). This factor influences interfirm trust positively, due to the fact that the building blocks of trust, formed at the interpersonal level of interacting organizations, will be the path towards interorganizational trust. Therefore, Barnes et al. (2015) conclude that a higher level of personal credibility leads to a higher level of organizational trust. Additionally, Tsang (1998) mentions that trust has a significant influence on individual behavior, and is associated with successful relationship building. Even though personal credibility differs from trust in a way that it is more personal, emotional, and anthropocentric (Mouzas et al., 2007). Additionally, sometimes a formalized agreement does not mean anything, when trust is lacking.

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2.4 Modes of communication

To come back to the modes of communication, this paragraph will elaborate on that. To make relationships work, the communication between two agents needs to be sufficient. The quality of communication experienced by individuals plays a significant role in the outcomes of interactions (Liu et al., 2010). Outcomes of interaction include cooperation, to reach the firms goals. Different modes of communication exist, for instance face-to-face, computer-mediated communication, phone calls and meetings (Ocker et al., 2015; Ochsman & Chapanis, 1974). Each of these modes of communication has its own personal value and information attached to it.Kiesler & Sproull (1992) argue that face-to-face meetings are an effective means for defnining issues, securing commitment, and decomposing the task. Additionally, face-to-face meetings or conversation include more personal contact, in which more interaction is possible too (Chanpanis et al., 1972). Computer-mediated communication exists in the form of text-based messages, such as email contact, instant messaging via apps or social network sites like Facebook (Cao & Lin, 2017). However, text-based messages are less rich in personal cues, compared to or face-to-face meetings. This is due to the fact that non-verbal cues are missing, such as eye contact, emotions or facial expressions and nodding (Cao & Lin, 2017). These cues however, are present in face-to-face conversations, on which also can be responded accordingly. Communication always involves both a sender and a receiver, and the information exchanged between them (Kellner & Le Quement, 2017).

The mode of communication is of importance in this research since the amount of information enclosed in the communication between two agents can affect the performance of the firm.

The processes of connecting modes of communication, factors of interpersonal relationships, and the operational performance are still under-investigated, leading to the following research question: “What is

the effect of interpersonal relationships on the operational performance of an organization?”. By

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3. Methodology

The literature review shows that some relations between the interpersonal relationship and the performance of a firm exist to a small extent. However, in practice this has not yet been researched. By exploring the phenomenon of interpersonal relationships, we can contribute to the relationship theory on the performance of a firm, therefore theory development is needed to explore this phenomenon.

3.1 Research strategy

A qualitative research design was employed in this research and semi-structured interviews were used as the primary tool to gather data. There has been chosen for a qualitative research design since it is exploratory research in which case studies focus on understanding the dynamics present within single setting, to generate theory. Therefore, more in-depth information can be gained from cases (Eisenhardt, 1989).

3.2 Population and sample

Data was collected from the Dutch restaurant industry, which is a still growing branch in the Netherlands, with more restaurants popping up each year (CBS, 2016). Since restaurants are a combination of both product and services, both relationships and performance are key. This makes the restaurant industry perfectly suitable for this research. Additionally, a lot of large worldwide franchise organizations are present in this branch. Consequently, structures and hierarchies are present, which enable more different types of relationships between agents.

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relationships at different levels in the hierarchy, to gain more knowledge. Of both organizations two affiliates are used for the research, resulting into 4 final cases. Consequently, another reason for choosing these two chain restaurants, is that mutual comparisons within the chain can be made, to distinct any potential factors of influence. At chain X one person of the headquarters, considered as the franchisor, two restaurant managers and two employees were interviewed. Both restaurant managers are in charge of a restaurant, where one of the restaurants is owned by the headquarters of chain X itself. The lines between the restaurant owned by the headquarters and the headquarter itself are therefore much shorter, since no franchisee is in between. By interviewing both a headquarters owned restaurant and a franchisee owned restaurant, additional insights could be gathered. At chain Y, two franchisees, one restaurant manager and one employee on the work floor were interviewed. Both franchisees belonged to the first 20 affiliates which opened in the Netherlands, so they are in the business from almost the start and have a lot of experience. Details of the case companies and affiliates can be found in table 1, whereas information about the interviewees can be found in table 2.

Franchisee

/ HQ

owned

Type of location Drive

in? Type of employees + amount Terrace? Restaurant 1 (chain X; case 1)

HQ owned Small city (average age density); located just outside town; only affiliate in town

Yes Mix of old, young, experienced, unexperienced, different cultures; 90 Yes Restaurant 2 (chain X; case 2) Franchisee owned

Big city (young population); located in city center; 4 affiliates in city

No Mostly students, for a short term, part timers; 90 Yes Restaurant 3 (chain Y; case 3) Franchisee owned

Average city (young population); located in city center; 3 affiliates in the city No Mostly students No Restaurant 4 (chain Y; case 4) Franchisee owned

Big city (young population); located in city center; 6 affiliates in the city

No Mostly students No

Table 1 Descriptive statistics about case companies

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13 Interviewee Case company Gender Years working for company Part time / full time

Previous job functions

at the same

organization

Franchisor X Male 30 years Full time X

Franchisee 1 Y Male 12 years Full time X

Franchisee 2 Y Male 12 years Full time X

Restaurant manager 1 X Female > 16 years Full time Crew member, crew

trainer, management trainee, shift manager, floor manager, first assistant

Restaurant manager 2 X Male > 12 years Full time Burgers flipping, shift manager, assistant manager

Restaurant manager 3 Y Female > 7 years Full time Crew member

Employee 1 X Female 5 years Weekend

shift

X

Employee 2 X Male 10 months Full time for

1 year

X

Employee 3 Y Female 3,5 years Part time X

Table 2 Descriptive statistics of the interviewees

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3.3 Data collection

The interview guide, which was used for this research, can be found in appendix 1. It was created in a group of five researchers, all with different research purposes. Creating the final interview guide took almost two months, due to other priorities and absenteeism of other researchers. In the interview, 6 core topics are addressed. These are introduction to the interviewee, expectations about levels higher or lower than the interviewee, the interpersonal relationship, the contract, conflicts and lastly, feedback. The topics were ordered from least sensitive questions, to more sensitive questions, to a final question about electronic feedback. The reason for this order is that this way the interviewee might get more comfortable, and is willing to answer more personal questions as well. These six topics were covered in 13 main questions, which had some guiding words/questions attached to it to create more clarity if needed. To structure the interviews, this interview guide is used for all the interviewees, although some questions were left out at certain interviews because the interviewee had no knowledge of this. The questions are semi structured questions, with some guiding questions which can help the interviewee understand and answer the question, in case they appear to be unclear. However, this was limited as much as possible, to keep the questions semi structured, instead of structured and leading them to an answer. Interviews were conducted in a period of three weeks, at different times of the day. Mostly the interviews took place at the restaurant itself, except for the interview with the franchisor which took place at his home. All interviews were recorded, to stay focused during the interview, and create useful transcripts. Finally, the recordings of the interview were being typed out into transcripts

3.4 Data Analysis

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being developed in vivo to create a list of useful codes, and when codes were missing in my opinion, they were added to the list. Both deductive and inductive codes were being used. The codes which emerged from the literature review are: communication, face-to-face, mail and letters, phone calls, social media, interpersonal relationship, commitment, trust, personal affection performance, financial performance, and operational performance. These codes have been mentioned in the literature review as well, and were assumed to be present in the interviews. Additionally, some new codes were being developed during the coding of the transcripts as well. The new codes were duration, effort in connecting, frequency of communication, platform, expertise and learning, group meetings, training and courses, caring, honesty, involvement, and motivation. Also, some codes which popped up as an interesting code turned out to be irrelevant and were skipped, such as the location of the communication. This became irrelevant since almost all communication took place at the restaurant or headquarters, and could therefore be left out. Some general codes were split into sub codes, since then the codes can provide more details and specific information is ordered better. The codebook can be found in appendix 2. This way, some structure was developed in the coding process.

3.5 Controllability, reliability, and validity

Concerning the quality of a research, it is of vital importance that the quality of a research can be assured by the controllability, reliability, and validity. For a research to be reliable and valid, it first should be controllable (Aken et al., 2012). Controllability is assured by the reveal of how this research has been conducted and which steps were taken.

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topic of this research, since the other researcher had a different objective (Aken et al., 2012). Since the interviews were conducted by me and an additional researcher, this is the case. Unfortunately, due to a time constraint the coding was only done by one person. This means no correlation between two coder’s results could be assessed, and no inter-rater reliability could be assessed, to determine the reliability (Aken et al., 2012). Reliability concerning the circumstances of the interview, the interview of the franchisor took place at his house, in the evening. Whereas the interviews conducted at chain X affiliates were both in the morning, one on Sunday morning at 11.00 and the other at a Tuesday morning at 10.00. For the restaurant, these were moments of time where the restaurant was not crowded anymore from people who want breakfast, and not crowded yet for lunch time. At chain Y, the interviews were conducted both in the morning and in the afternoon, even at crowded moments. In one of these interviews, a colleague was constantly asking when the interviewee would join her, since it was crowded. This might have pushed the interviewee to rush through the interview, since their colleagues need help, therefore, this could have led to some bias. Reliability of respondents in this research was increased by conducting interviews at different levels in the organization, and not from one single point of view.

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4. Results

This section covers the major results of the cases and points of discussion, which are discovered via interviews and its analysis. Results and quotes will be categorized per relevant topic for this research, which means that the operational performance is left out, since the findings were not reliable and valid enough. These are interpersonal relationship, communication, and the quality of the interpersonal relationship. According to Eisenhardt and Graebner (2007), the challenge in multiple-case research is to “stay within

spatial constraints while also conveying both the emergent theory that is the research objective and the rich empirical evidence that supports the theory”. This was also a big obstacle in this research, since the

literature review and the intent were on the interpersonal relationship and its effect on the operational performance, however, not enough adequate observations of the performance of the restaurants were available. Therefore, the operational performance has been left out of the results section, and further on. The intent in the literature review and the results, therefore, differ in direction.

4.1 The interpersonal relationship

In the codebook, the interpersonal relationship was divided into six elements which could be of influence, which are caring, commitment, honesty, involvement, trust, and personal affection. These factors are also mentioned by Barnes et al. (2015) and Colguitt et al. (2007). From the literature review, personal communication was also determined as a factor of influence, which will be mentioned in paragraph 4.2. In the interview transcripts, factors related to interpersonal relationship itself were mentioned 57 times, while the times that it belonged to the factors which define interpersonal relationship, were 62 times. Consequently, there are some words and expressions which can clearly be grouped into one of the specific codes, while others, are harder to be grouped, and therefore added to interpersonal relationship code itself. From all the coding, these numbers are quite big, compared to other codes.

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put in the interview, regardless of their function. Restaurant manager 1 and restaurant manager 2 both responded, respectively:

“You shouldn’t have done that, but thank you very much! I will definitely share this with the crew, now we have a nice treat in the break.” (Restaurant manager 1, chain X)

“Oh wow, thanks. I will share this in the crew room with the crew, so we can all enjoy the bar” (Restaurant manager 2, chain X)

Whereas the employees on the work floor reacted differently:

“Ah nice, thank you. Do you have any more interviews in which you need help? Ha-ha”

(Employee 2, chain X)

“Oh, I love this bar. My husband will be very happy with this bar, since last time we were doing grocery shopping, he already wanted to buy this bar, but we didn’t do it. So, thank you!” (Employee 1, chain X)

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relationship differently, whereas the manager wants to be more than only the manager by sharing his bar. However, the employees view this differently.

Additionally, a question beyond the interview guide about the motivations for working at that particular chain or restaurant, was added to the interview. This lead to different motivations the restaurant managers had, and the employees had. Both the restaurant managers from chain X studied for a different job in a different sector than in the hospitality sector. However, due to their passion for the organization and employees, they prefer to work as a restaurant manager. Money was never mentioned as a motivation to continue to work as a restaurant manager. However, both the employees from chain X mentioned that money was their first motivation to work at chain X, and second came their colleagues. These different motivations show what the real intentions are at the work floor. Therefore, the example of the chocolate bar is an excellent example of how the restaurant managers treat their employees, and how this shapes their interpersonal relationship. On the other hand, it also shows how the employees feel about small bonuses, and how this impacts them individually. Some distance is to be noticed between the manager and the employees, which continues in the next paragraph.

The distance between the restaurant manager and the employee was also noticeable in another example, where the hierarchy created distance between the restaurant manager and the employee

“Of course, we have performance talks and evaluation conversations, but those are mainly conducted by the managers, or by me. But, to know how in the meantime the employees on the work floor are doing, we saw that conversations between two employees led to more information, since they are talking more easily. That is what the Research Department & People is for.” (Restaurant manager 1, chain X)

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Here, one can see that the restaurant managers are more distanced from their employees, than employees mutually. Mutual conversations between employees about the progression and issues in their work, seem to be more effective than having the same conversations between an employee and a manager. From the interviews, it came forward that the employees feel more free to express themselves towards their fellow colleagues, than to their manager. Therefore, the evaluation meetings with the fellow employees contain more valuable information, as well as personal information, resulting in a better connection between employees mutually. In chain Y, the restaurant manager did not mention anything regarding the distance between the employees and the restaurant manager itself. That could also be due to the fact that the restaurants of chain X are larger in general, and therefore the restaurant manager has less time to participate on the work floor itself, but must manage more deals. Whereas the restaurant manager at chain Y is actually to be found behind the counter more often, making lines shorter and contact more personal. This distance influences the interpersonal relationship in a negative way, since the employees feel more distanced from their managers. From this example, it could also mean that the size of the restaurant impacts the relationship between the managers and the employees, because at the smaller restaurants in chain Y, the managers are also performing tasks that the employees perform as well.

To summarize, two different types of relationships on the work floor are to be found, which are the lateral relationships between the employees, and the vertical relationships between employees and managers. The three groundings of the interpersonal relationship were personal communication, personal credibility, and personal affection (Barnes et al., 2015). In the next paragraph, more attention is paid to the factor of personal communication.

4.2 Communication

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instance the location was wondered too, but since most of the conversations took place at the work floor, it became an irrelevant factor. Therefore, this factor was taken out of consideration. In table 3a, 3b, 3c, 3d and 3e, one can see the different communication modes, between whom, how often, the duration if possible, and the reason of communicating. With the HQ, the headquarters in the Netherlands are meant, unless specified differently. Also, the relationships are all within the same chain, so therefore sometimes the chain is not specified. In the sample description, one can find again which interviewee belongs at which chain.

Communication between Frequency Duration Topic

Franchisor, chain X

Franchisees, chain X Irregular Serious problems at the affiliate Franchisor,

chain X

Franchisee, chain X Once a year Half a day Informal barbecue between HQ and franchisees to stay in touch

RM 1 Supervisor Irregular Questions / small issues

RM 1 HQ, chain Y Irregular Questions / small issues

RM 1 Supervisor Once in 3 weeks Discussing operational and financial performance

RM 1 Employees Contract renewal Performance of employees

RM 2 Employees Irregular Performance / evaluations conversations / points of

improvement

RM 2 Franchisee Irregular Short Discuss minor issues

RM 2 Franchisee Once / twice a

year

Make plans for coming year, discuss big things

Employee 1 RM 1 Irregular Working hours, questions, personal issues

Employee 1 Employees Irregular Doing activities outside work

Employee 2 RM 2 Contract renewal Performance evaluation + check list

Franchisee 1 HQ Irregular Asking for advice

Franchisee 2 Development agent of the region

Once a year Fun day for all franchisees of that region + developments agents

Franchisee 2 Development agent of the region

Once in a few months

Informal cup of coffee

RM 3 Employees Once a month Discuss operations + points of improvement from

inspection

RM 3 Franchisee 2 Irregular Short Discuss daily things

Employee 3 RM 3 Less than once a

week

Since working hours of employee and RM, they often do not see each other

Table 3a Face-to-face communication between different interviewees

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greeting colleagues and the manager when entering the restaurant, or having conversations during a break, etc. This mode of communication is most frequently used among employees, and between employees and the manager, since they see each other daily on the work floor. However, higher vertical relationships are less characterized by personal communication such as face-to-face communication, which also explains why the vertical relationships upwards are less interpersonal. Face-to-face contact contains most information since emotions, facial expressions, gestures as well as tone and speed can be used as indicators of information (Chanpanis et., 1972). This brings us to a less information rich communication mode, which is email.

Communication between Frequency Topic

RM 1 Supervisor Irregular Questions / minor issues

HQ, chain Y Franchisee 1 Once a week General information

Franchisee 1 HQ in USA Irregular Issues which seem trouble at HQ in Netherlands HQ, chain Y Franchisee 2 Once a year Survey about the monthly evaluations

Franchisee 2 Development agent of the region

Very often Discuss daily things

Table 3b Communication via email between interviewees

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Communication between Frequency Topic

RM 1 HQ, chain X Irregular Questions / minor issues

RM 1 Supervisor Irregular Questions / minor issues

RM 2 Franchisee Irregular Minor issues / daily things

Employee 1 RM 1 Irregular Questions, working hours,

personal issues

Franchisee 1 HQ in USA, chain Y Irregular Solve issues, which can’t be solved with HQ in Amsterdam

RM 3 Franchisee 2 Irregular Daily things

Table 3c Communication via phone call between interviewees

In the next table, table 3c, information from phone calls is provided. Most phone call conversations are used for asking for advice or solutions to small problems, without discussing endlessly on the phone. Due to this, the frequency of phone calls is irregular, since questions pop up, and cannot be planned. Also, the phone calls are usually short of duration. Furthermore, the phone calls happen more often between different layers in the hierarchy, than on a lateral level. This way of communication is often used to receive a fast reply which is needed to continue operating.

Communication between Frequency Topic

Managers chain X Employees, chain X Once or twice a month

Performance groups focusing on either People, Service Experience, or Food.

Franchisee 1 HQ, chain X Collectively communicating with

the franchisor Franchisee 2 Developing agent of

region

Once a year Fun day with non-business activities for the bonding

Franchisee 2 Franchisees, chain Y Once a year Voting about assortment in the restaurant

Employee 3 HQ, chain Y Once a month Meetings for personnel to stay informed and educated, organized by HQ

Table 3d Communication via group meetings among interviewees

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informal business trips of one day with the crew and managers, to improve both lateral relationships as well as vertical relationships. However, these bonding activities are only once, maybe twice a year.

Communication between Frequency Topic

RM 2 Franchisee, chain X Irregular Small daily issues, via chat Employee 1 RM 1 + other personnel Irregular Birthdays, new products,

etc. via Facebook

RM 3 Franchisee 2 3 or 4 times a day Keeping franchisee up to date, short questions, daily things, etc. via a chat

RM 3 Employees, chain Y Every day Working hours, shifts,

inform personnel via a group chat

Table 3e Communication via social media among employees

The last mode of communication, social media, can be found in table 3e. With social media chat apps, such as WhatsApp and Facebook are meant. This is an efficient way of passing through information, as most of the people have smartphones and internet connections nowadays. These are also used for sending quick messages, and informing a lot of people at the same time, to be more efficient. This is a more informal mode of communication, and is more often used in the lower layers of the hierarchy. Mostly between employees, or between employees and the manager, to keep each other up to date. This also involves personal messages, and not only business related information.

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be further explored. When the interpersonal relationship is present, the quality of it can be affected as well. In the following paragraphs the quality of different relationships will be analyzed and compared.

4.3 Quality of the relationship

The quality of the relationship was earlier characterized by three elements: cooperation; commitment; and satisfaction (Barnes et al., 2015). These three elements were to be found at different levels, between different persons. In the end cooperation and commitment lead to satisfaction in the relationship (Barnes et al., 2015).

Starting with cooperation, as in working together, this is to be found among employees mutually a lot. However, between managers and employees it differs in some instances. With the cooperation between the manager and the employees, some things can be found. At chain Y, the restaurant manager sometimes helps behind the counter, with the same tasks the employees are performing. For example, restaurant manager 3, from chain Y, mentions that she helps the employees behind the counter, or when people do not show up at work, she is helping the employees out. However, at chain X, due to a larger size of the restaurant and more side activities, the restaurant manager is less to be found doing the actual activities that the employees perform, since the manager has other priorities at the restaurant. Making sure everyone is on time in his or her position, guiding people, instructing people, dealing with customer complaints, etc., are all activities which are part of the daily activities the manager performs. These activities do not, or almost not, include cooperation with the employees. However, among employees mutually, different findings are to be found, starting with the next quotes:

“When I see someone of my colleagues struggling, or doing something not exactly according the procedures, I try to help them and say something about it to them.”

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“Actually, it is like, I always say, I work with my friends. That is nice, yes.” (Employee 1,

chain X)

In these two examples, one can see that cooperation on the work floor among employees mutually is present in several forms. From guiding colleagues who are having difficulties with for example, preparing a burger, to working and motivating each other until the end of the day. One of the things which also came forward from the interviews, and is to be found in a commercial of chain X to attract teenagers to get a job, is the crew working there. Nice colleagues and a great atmosphere are what chain X promotes, and according to the interviews this is stated as well. During the interviews a positive attitude towards colleagues could be noticed, and the fact that they motivate each other, also during days when they do not feel like working, or are tired, is what keeps the spirit high at chain X. Therefore, cooperation is indeed an important characteristic of the quality of a relationship.

Moving on to the commitment that one has for the other, this is something which is harder to detect from interviews solely. However, it was to be detected between the manager and the employees. In the following quote, the commitment of the manager towards its employees becomes clear:

“When something happens in the restaurant outside my working hours, I would go to the restaurant. That is something I do for the organization. But, I would rather do it for the people, than for the franchisee. For the people in the restaurant, the personnel.”

(Restaurant manager 2, chain X)

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employees is better than the interpersonal relationship between the restaurant manager and the franchisee, since the restaurant manager is more willing to do something for the employees. Again, as well as with the chocolate bar, this shows how the manager feels towards the employees. Additionally, both the chocolate bar and the commitment come from the side of the manager, and not from the employee.

This example of commitment also deals with taking care. The restaurant manager takes care of the employees by helping them solve problems, even outside office hours. He takes care in a way that the employees do not have to do it all on their own, but have some back up in cases of emergency. Employees have a safety net to make mistakes, since the responsibility of the performance of the restaurant is in the end in the hands of the restaurant manager. And by assuring that things which get messy or broken, are fixed in the end of the day, it shows that the restaurant manager not only cares about the employees to let them work in a problem free restaurant, but also takes responsibility of the performance for 24 hours a day. By ensuring both the cooperation and the commitment, the satisfaction of the relationship can be assured, which will be discussed in the next paragraph.

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“Ehm, well, the supervisor I have now, he basically trained me to be a restaurant manager. So, my relationship with him is good. Well, it is always business, but there is also space to ask personal things. Yes, that is possible. But I am not standing in the bar with him, drinking a beer for example. No, that is not the case.” (Restaurant manager 1, chain X)

“I’ve had many jobs in my life, but the way how at chain X everyone interacts with each other, I like that the most.” (Employee 1, chain X)

“People who work for chain Y are pretty much like a family.” (Franchisee 1, chain Y)

“My relationship with the headquarters in Amsterdam is very pragmatically, and purely an exchange of information.” (Franchisee 2, chain Y)

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Person 1 Person 2 Type of relationship Characteristics

Franchisor/ HQ Franchisee Good, business Only necessary information.

RM 1 HQ Business Only necessary information exchange

RM 1 Supervisor Business like, good Mostly business talk, also space for personal questions. Honesty is valued.

RM 1 Employees Good Honesty is key

RM 2 Franchisee Good, but business

like

Requests from franchisee are being honored; franchisee seen as a boss

RM 2 Employees Good, but slightly

distanced since the promotion to RM

Strict, but also joking. Willing to do a lot for the crew. Organizing personnel days, activities around work. Not only mentioning negative things, but also positive things.

Employee 1 Employees Good, close. Cozy, personal, also outside work. Friendships are not uncommon. Feels like a family. No vertical distance between employees.

Employee 1 RM 1 Good, open Open and trust is important.

Employee 2 RM 2 Okay Joking is allowed

Employee 2 Employees Okay, only work related.

Fun is important. Twice a year crew activity day, also with managers.

Employee 3 Employees Cozy It is fun working with employees.

Employee 3 Franchisee Business like When things go wrong, you hear it. Franchisee 1 Franchisor Good, business Contact is good. There is mutual trust. Franchisee 1 Employees Good, family alike Things feel like a family. Franchisee 1

even pays tuition fees for two employees. Franchisee 2 Franchisor/

HQ

Good, business Purely business and only for information exchange

Franchisee 2 Development agent of the region

Good, and more personal in the years.

Once a year a fun day with franchisees and DA. Cup of coffee and personal talks are common.

Table 4 Interpersonal relationships between interviewees

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paragraph. This cooperation leads to a higher quality of the relationship, which explains why the employees are more close to each other, compared to a manager and an employee. Furthermore, this less interpersonal relationship between manager and employee can be explained by the fact that the employee works for the manager, instead of with the manager. This brings us to the discussion which will deliberate on this further on.

5. Discussion

After seeing the results of the different topics, several points of discussion come to mind, resulting into propositions which could be useful for future research. The operational performance is left out of the discussions, since its findings were not relevant and reliable enough.

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to be brought. Therefore, there is more personal communication among the employees laterally, than there is personal communication in the vertical relationships.

Continuing with the quality of the interpersonal relationship, cooperation, commitment, and satisfaction are important elements (Barnes et al., 2015). With the lateral relationship, the element of cooperation is clearly present, since the employees need to cooperate in order to deliver the right products and services to the customers. The commitment to the relationship between the employees mutually, is present too. This is also to be found in the fact that employees sometimes see each other outside working hours in private life. Consequently, this also leads to satisfaction in the lateral relationship, which could be detected by the way how the employees call their employees friends, and talk about the atmosphere very positively.

However, from the position of the manager, which is higher in the hierarchy than the employees, some differences can be detected. Of course, it is the job of the manager to take responsibility for the work of the employees, and guide and coach them in the right direction (Cook, 2009). Additionally, the manager is responsible for the performance of the firm, both operationally and financially. Therefore, the manager must take his responsibility and address its personnel when certain activities are badly performed and need improvement. Also, the interviews reveal the moment when the restaurant manager got a promotion to restaurant manager, the interpersonal relationship between him and the employees has watered. Since the restaurant manager is not cooperating with the employees anymore, this factor is less present, which in turn results in a less interpersonal relationship. The restaurant manager, compared to the employee, hasdifferent goals on different levels. Whereas the employee wants to make the best burgers, the restaurant manager is looking more at the overall picture of the restaurant. Therefore, the lack of common goals, also leads to less cooperation, which results in a less interpersonal relationship.

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interpersonal relationship between the manager and the employees, from the perspective of the manager is there, which would result in a more interpersonal relationship. Barnes et al. (2015) mention that prerequisites for the satisfaction in an interpersonal relationshiparethe cooperation and the commitment in a relationship. However, only the commitment element is present, which does not lead to a satisfied interpersonal relationship. This is also in line with the theory of Barnes et al. (2015), since they mention that both elements should be present in order to have satisfaction in the relationship and thus a higher quality of the relationship. All the points mentioned earlier in the discussion are leading to the first proposition: more vertical distance between two persons on the work floor, leads to a less interpersonal relationship. According to Barnes et al (2015), when cooperation or commitment is lacking, it cannot lead to a satisfied relationship, or a relationship of high quality. Therefore, this finding is in line with the theory of Barnes et al. (2015). Relationship theory is to be found in several industries like hospitals or in electronic sectors, yet, in the restaurant industry, not much about relationships on the work floor is to be found. This is mainly due to the focus customers, since customers are the center of the hospitality industry and the source of revenues (Castellanos-Verdugo et al., 2009). The focus on internal relationships, within the firm, on the work floor level, are lacking, which is where this study provides some food for thought or a ground to begin on.

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It is remarkable to see that the managers are willing to share their gift with the employees, but that the employees were not intending to share their bar with either their lateral colleagues, or with the managers. This shows that both the managers as well as the employees have a different perspective of the interpersonal relationship between them.

From the first paragraphs in the discussion, it seems that the lateral relationship between the employees is better than the vertical relationship between the manager and the employees. However, when one sees the reaction of the employees, regarding the reward they got, the employees chose for themselves. Additionally, it is the manager who chose to share it with the employees, even though the interpersonal relationship between the manager and the employees seems to be less interpersonal. The managers really want to show their effort for the employees, and their caring for the employees by sharing this chocolate bar. They want to have a more interpersonal relationship, nevertheless, due to their obligations as restaurant managers, it is not possible to be their friend on the work floor. It is important to balance their job as a manager, and being a friend to the employees (Cook, 2009). So even though the managers must behave as managers, it seems they are still longing for a relationship on the work floor here, but this is hard from their positions.

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However, since the managers are lacking the cooperation with the employees, they also lack in the quality of the interpersonal relationship. The commitment factor is present in their relationship; however, the cooperation is lacking. It seems as if the managers want to compensate for this lack of cooperation, by sharing their chocolate bar with the employees. Since the restaurant managers do not have anyone working on the same hierarchical level with them, there are no lateral interpersonal relationships at the level of the restaurant manager at the work floor. Therefore, the managers are putting a lot of effort in the interpersonal relationships with the employees. Whereas the employees do not have to do this, since they are cooperating with each other, resulting almost automatically in a more interpersonal relationship between them and other colleagues. One could say that the second preposition is that managers are more involved in building interpersonal relationships on the work floor than the employees are. Meaning that the managers want to interact with the employees, and try to show interest in them in a more conscious way, than the employees are. This new insight in the way how the managers react towards interpersonal relationships at the work floor, and how they are trying to connect, shows different perspectives, compared to how the employees react. The employees are not so much focused on building interpersonal relationships, because of their cooperation with their colleagues. In the current literature, more is to be found on the topic of the employees building interpersonal relationships with customers in the hospitality industry, instead of with colleagues (Castellanos-Verdugo et al., 2009). Hence, our research and results add to the literature of relationships on the work floor, instead of relationships with external parties.

6. Conclusion

To conclude, two observations can be made to answer the following research question: “What is the effect

of hierarchical distance on the interpersonal relationships on the work floor of an organization?”. Firstly,

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of importance to create a higher quality of the relationship (Barnes et al., 2015). Even though other factors such as personal communication and commitment may be present, it seems that the cooperation is essential for a better quality of the interpersonal relationship. Since cooperation is lacking, this is in line with the theory of Barnes et al. (2015) because it does not lead to a high quality of the relationship. Secondly, managers are more involved with building interpersonal relationships on the work floor, than the employees are. Since the employees are cooperating to perform their jobs, and have a lot of personal communication on the work floor, their interpersonal relationship is of higher quality. However, the interpersonal relationship between the manager and the employees is not based on cooperation, which is the reason the manager is putting more effort in the relationship. He is more actively trying to get a more interpersonal relationship, since he is lacking on other characteristics, such as the cooperation and communication. The example of the chocolate bar shows this as well, because the managers chose to share their bar with the employees.

There are quite some limitations to this research due to a lack of time, and the scope of the researcher. The first limitation is, the conducting of the interviews. The interviews have been conducted by two different researchers, both with a different intention and research goal. However, the same interview guide has been used. This way one researcher will focus more on his own topic, and not into as much detail on the other topics. Due to this, some of the cases do not provide as much information, as the cases which have been conducted primary. Since these interviews also indicate aspects which cannot be seen in the transcripts of the interviews, such as giving the chocolate bar and the reaction on that.

The second limitation is the sample used for this research. Both chains in this sample are fast food restaurants, originated from the USA. For further research, a more diverse sample could provide a better ground to explore the effects of hierarchical distance on interpersonal relationships.

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The fourth limitation of this research is that the results and discussions are only based on the interviews. Unfortunately, no additional documents or archives were available, due to the fact that they are not listed as public organizations (Chain X, 2017). For the cooperation of chain X as a whole, annual reports and files were available, but these were not useful for this study.

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Appendices

Appendix 1, Interview guide

(Give small introduction: joint research, anonymity)

1. Can you tell a little bit more about yourself and what you do?

- Function? How long? Why this firm?

2. How did your relationship with this franchisor/chain/employer/employees start?

- Who? Who started the structure? When? Why? - Why this chain? (Why you?) Franchise/License? - Are you satisfied with the franchisor? Why (not)?

These two questions are about the level above the interviewee

3. What do you expect from the one level above you? (franchisor/chain/employer/employees)? What’s in it for you?

- Information? Expertise? Support for adaptations to local market needs? - rights? advantages? benefits? values?

- likes? Dislikes?

- Do you have the feeling that the franchisor (knowingly) withholds information? Do you experience this as dependence?

4. What does the franchisor/chain/employer/employees expect from you? What’s in it for them?

- Information? Information sufficient? expertise? Suggestions for adaptations to changing market needs? - duties? constraints? downsides? evaluation criteria?

- mutual benefits?

These two questions are about the level beneath the interviewee

5. What do you expect from the level underneath you (chain/employer/employees)? What’s in it for you?

- Information? Expertise? Suggestions for adaptations to local market needs? - rights? advantages? benefits? values?

- likes? Dislikes?

- Information always reliable?

6. What does the franchisor/chain/employer/employees expect from you? What’s in it for them?

- Information? expertise? suggestions?

- duties? constraints? downsides? evaluation criteria? - mutual benefits?

Give small intro: This question is about interpersonal relationship

7. How do you perceive/feel about the relationship with the person above you?

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This part is about the contract of the franchisor with the franchisee

8. Are there controls ensuring that you both keep your end of the contract?

- Reporting? Visits? Mystery shoppers? - Meetings? Trainings to improve skills? - Benefits? Bonuses?

- Underperformance? Consequences? Penalties?

- How is the franchisor/manager/employee assessed in his work?

9. Which (dis)advantages do you have from the fact that the franchisor makes policy decisions, which also influence this location?

- Examples?

- Able to deviate from predetermined policies? Adaptations to local market needs? - Involvement in making new (overall) strategies?

10. Do you feel sometimes that the expectations of the franchisor/chain/employer/employees do not fit your outlets customer needs and are thus unnecessary or even have a negative influence on your performance? (or too difficult to implement)

- unable to do? unwilling to do? Does not fit needs of local market? - examples?

- pricing? products? Interior equipment / decoration? Supplier? Special Offers? Other

11. What do you do when that happens?

- Compliance? Good or bad? - Deviation? Good or bad?

If you were completely free to change things (e.g. if you would own the business) what would you do differently?

- Examples: What are the underlying reasons for choosing this behavior? Reducing costs? Improving quality of service?

12. Do you sometimes have disagreements or conflicts with the franchisor/chain/employer/employees, and how do you solve them?

- How do you improve the relationship? - And the level beneath/above you?

13. How do you value electronic feedback?

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Appendix 2, the codebook

Code Description Sources

(interviewees)

References (coded segments) Communication Any type of communication or contact, when not specified

what type of communication is used, could be both verbally as written down

9 68

Duration How long the contact/communication between two or more party’s lasts

2 2

Effort in connecting The amount of effort it takes to get into connection with another person. Whether the person is available for you, or more occupied.

3 4

Frequency of

communication

How often communication or contact happens, either per day, per week. per month, per year, etc.

9 45

Medium of

communication

The type of communication which is used. 0 0

Face to face Conversations which take place in person, in reality. 9 62 Mail and

letters

Communication via email or either via written letters and notes, left for the intended person.

7 20

Phone calls Conversations which take place through the phone, when two persons are at different places.

6 16

Social media Communication via social media, including apps on phones such as WhatsApp, but also Facebook, Twitter and other social media instruments.

6 15

Platform A device or program only meant for internal persons, which is used to share information and knowledge.

6 8

Expertise and learning Knowledge availability and others able to help 1 1

Group meetings Meetings with 2 or more individuals which come together to discuss problems, new ideas, or share knowledge, to get better from it. Can be both on a regular or irregular basis.

8 21

Training and courses Information trainings and courses for employees, restaurant managers, franchisees, to gain more knowledge, which could be directly applied in practice. Also, to gain more skills, to increase your operational performance.

8 27

Franchise affiliate An affiliate owned by the franchisee 1 1

Interpersonal relationship The relationship between two individuals, characterized by things such as personal communication, personal affection and personal credibility. Anything which could be related to the interpersonal relationship between two or more persons. Either positive (binding, connecting them) or negative.

8 57

Caring Things which relate to people sometimes needing some attention, either emotional, financial, or in another way.

7 12

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