What does mean by Formal and Informal Organization?

Within any organization, there are both formal and informal components. A formal organization exists as a result of the official structures and systems designed by managers through organizing activates.

A formal organization normally contains a structured communication and command system that helps people pool their time. energy, and talents to reach common objectives.

Formal and Informal Organization

A formal organization exists on the strength of the official structures and systems designed by managers.

Informal Organization

By contrast, an informal organization exists when two or more people interact for a purpose or in a manner beyond that specified by the manager. Often informal organizations evolve in a natural, unplanned manner, but they may also be formed intentionally, such as when nurses in the burning word of a hospital meet to discuss problems they have with the doctors and patients.

Experience shows that each member of an informal organization has personal reasons for joining it, for he/she exchanges information with others, satisfy individual his or her needs, and influences or is influenced by, others. Informal organizations may have direct and significant implications for the managers of the formal organization.

Sometimes informal groups become formal groups, as would occur if the burn word nurses just described organized a union. An informal organization exists when two or more people interact for a purpose or in a manner not specified by management.

An idea about the formal and informal organization may be had from the following diagram:


Formal Organization

In the formal organization, managers prescribe expected behavior through job descriptions, rules and policies, and operating procedures. By contrast, informal behavior arises from the needs, norms, values, and standards of the organization members.

The formal organization in a company that assembles, for example, exhaust fans might specify the time to show up for work, the type of clothing permissible, the method to be used in assembling bathroom exhaust fans, and the minimum number of fans that must be produced per hour, etc. The informal organization, however, may define a social norm which states that employees should not produce more than a certain number of fans per hour.

In the formal organization, the expected behavior is prescribed by managers but informal behavior arises from the needs, norms. Values and standards of organization members.

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