Formal n Informal Organization

Formal Organization

 

A formal organization is an organization that has a fixed set of rules where every worker knows exactly they are supposed to do in order to achieve the goals and objectives of the organization. The word formal describes that the organization has a well organized structure. A formal organization ensures that the rules and regulations are well defined so that individuals follow accordingly. It informs individuals of their tasks in brief and also makes sure that the individuals realise their boundaries. Most importantly, the main purpose of a formal organization is to ensure their workers are being monitored strictly so that they are able to concentrate on their work and make sure they coordinate well with other employees so that they are able to achieve the goals and objectives of the organization.

 

 

Reasons for the existence of the formal organization:

 

• In a formal organization an individual is briefed on exactly what he/she is supposed to do. This helps both the individual as well as the organization because since an individual's main objective is to achieve his/her goals it also makes it easier for the organization to accomplish its goals.
  
• The role of each worker, the responsibility of doing a task and the accountability of the workers in the organization is well defined. Hence this not only makes it easier for the employees to coordinate with each other but helps them coordinate effectively in different activities of the organization.
  
• A formal organization allows workers to specialise in what they do best. This helps in job satisfaction as the worker likes his work and knows what he is doing than and therefore specialisation may prevent inefficiency by a worker who does not specialise in what he does.
  
• A formal organization creates group cohesiveness which is the force of bringing group members close together.
  

 

 

Overall a formal organization is an organization that has a fixed set of rules or more like formal rules which workers have to follow so that they are able to ensure that an organizations goals and objectives are accomplished. But these formal rules tend to deviate and become more personal for example an individual will start and concentrate in achieving his/her own goals or have a different desire or even maybe behave in a not so organized way. Therefore this changes from formal to informal, so basically there is an informal organization in every formal organization. Formal organizations are typically understood to be systems of coordinated and controlled activities that arise when work is embedded in complex networks of technical relations and boundary-spanning exchanges

 

    
 

 

 

Informal Organization

 

An informal organization exists because it interconnects or unites the relationship or bond between groups of individuals, which means that group members interact with each other and discuss about matters other than work. For example a worker who is a Chelsea fan may discuss about a match with a co-worker who is also a Chelsea fan. This basically has nothing to do with work but enables workers to create a friendly environment and this interaction can help improve coordination and communication within workers. An informal organization has no proper structure or a fixed set of rules. It is something that is not planned but develops randomly. It exists alongside a formal organization but since it's informal it mainly develops due to personal relationships, social networks, and common interest. An informal organization also helps boost the motivation levels of workers. For example a worker might be really bored or stressed with work and a small break which involves the interaction between a co-worker about their common interests may actually relieve the stress of the worker and may even take away the boredom which enables a worker to get back to his with a fresh start.

 

 

The positive impact of the informal organisation on the business

 

• Complements the formal organization
  

  Formal plans, policies, procedures, and standards cannot solve every problem in a dynamic organization; therefore, informal systems must blend with formal ones to get work done. Informal relations in the organization prevent the organization from the self-destruction that would result from literal obedience to the formal rules, regulations, and procedures. No business organization could function merely by everyone following the "letter of the law" with respect to written rules and procedures. Faculty, staff, and informal groups must cooperate in abiding the law, to effectuate an organized, sensibly run enterprise.
  

• Speeding up processes
  

  Managers are less concerned on checking on workers when they know the informal organization is cooperating with them. This encourages delegation, decentralization, and greater worker support of the manager, which suggests a probable improvement in performance and overall productivity. When a manager acknowledges that workers are conscientiously working on their group projects, there are likely to be fewer tests and prompt checks on workers as to how they are doing their jobs. This eases the manager load and saves time on occasional checks which might even distract the workers confidence and rather promotes a better relation-ship between both parties.
  

• Improves communication among members
  

  The informal group develops a communication channel or system (i.e., grapevine) to keep its members informed about what management actions will affect them in various ways. This also allows workers to interact with each other which will help in revealing themselves and rather feeling more comfortable. This also encourages workers to step forward in giving ideas which might benefit the management in ways they are not aware of.
  

 

 

 

 

The negative impact of informal organisation:

 

• Rumours
  

  The grapevine dispenses truth and rumor with equal vengeance. Ill-informed employees communicate unverified and untrue information that can create a devastating effect on employees. This can undermine morale, establish bad attitudes, and often result in deviant or, even violent behavior.
  

• May cause Inefficiency
  

• Resistance to change
  

  Perpetuation of values and lifestyle causes informal groups to become overly protective of their "culture" and therefore resist change.