Formal Organization vs. Informal Organization
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Basis
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Formal
Organization
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Informal
organization
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Objectives
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It is consciously
created to achieve pre- determined objectives.
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It has no predetermined
objectives. It is created because of integration among people in the formal
organization.
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Structure
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It is an official
hierarchy of relations. It refers to the structure of well-defined authority
and responsibility relationships.
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Its structure is based
on human emotions and sentiments. It refers to the personal relationships,
which develop automatically when people work together.
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Formation
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Formal relations are
well planned and are created deliberately.
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Informal relations are
unplanned and they originate automatically.
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Chain of Command
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Formal organization
follows the official chain of command, which can't be changed. Communication
has to follow formal channels.
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Informal organization
does not have a fixed chain of command. It is based on command. It is based on
the sentiments of the members. There are no fixed patterns of communication.
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Stability
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Formal organization is
usually stable. It continues to exist even if some members leave it.
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Informal organization
does not last so long. The life of informal groups is generally short. They
can disintegrate if some members leave the organization or even get
transferred to some other department.
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Authority
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Formal authority is
institutional, i.e., it attaches to a position and a person exercises it by
virtue of his position. Formal authority flows downward as it is delegated.
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Informal authority is
personal i.e., it attaches to a person. It flows downward, upward and
horizontally. Formal authority is replaced by informal influence.
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Leadership
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The managers who have
formal authority provide leadership to the workers.
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Informal leaders are not
appointed, but chosen by the group members.
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Human Relations
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Formal organization
reflects technological aspect of the organization. It does not take care of
human sentiments.
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Informal organization
reflects human
aspect. It is based on
the attitudes, likes and dislikes, tastes, languages, etc., of people.
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Flexibility
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It allows a rigid
structure of relationships. The lines of communication and flow of authority
are predecided.
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It is loosely structured
and is highly flexible in nature. Communication is quite free as there are no
barriers to downward, upward or horizontal communication.
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Pattern of Behavior
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It has a prescribed
pattern of behavior for its members. There is a system of reward and
punishment to regulate the behavior of members.
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It develops social norms
of behavior through mutual consent. Rewards include satisfaction, social
esteem, recognition, etc. and punishments includes censure, isolation,
boycott, etc.
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