Formal organization is a fixed set of rules of intra-
organizationAn organization is a social arrangement which pursues collective goals, which controls its own performance, and which has a boundary separating it from its environment...
procedures and structures. As such, it is usually set out in writing, with a language of rules that ostensibly leave little discretion for
interpretationAn interpretation is an assignment of "meaning" to the symbols of a language. Many formal languages used in mathematics, logic, and theoretical computer science are defined in solely syntactic terms, and as such do not have any "meaning" until they are given some interpretation...
. In some societies and in some organization, such rules may be strictly followed; in others, they may be little more than an empty formalism.
- To facilitate the accomplishment of the goals of the organization: In a formal organization the work is delegated to each individual of the organization.
Formal organization is a fixed set of rules of intra-
organizationAn organization is a social arrangement which pursues collective goals, which controls its own performance, and which has a boundary separating it from its environment...
procedures and structures. As such, it is usually set out in writing, with a language of rules that ostensibly leave little discretion for
interpretationAn interpretation is an assignment of "meaning" to the symbols of a language. Many formal languages used in mathematics, logic, and theoretical computer science are defined in solely syntactic terms, and as such do not have any "meaning" until they are given some interpretation...
. In some societies and in some organization, such rules may be strictly followed; in others, they may be little more than an empty formalism.
Reasons for the existence of the formal organization
- To facilitate the accomplishment of the goals of the organization: In a formal organization the work is delegated to each individual of the organization. He/She works towards the attainment of definite goals, which are in compliance with the goals of the organisation.
- To facilitate the co-ordination of various activities: The authority, responsibility and accountability of individuals in the organization is very well defined. Hence, facilitating the co-ordination of various activities of the organisation very effectively.
- To aid the establishment of logical authority relationship: The responsibilities of the individuals in the organisation are well defined. They have a definite place in the organisation due to a well defined hierarchical structure which is inherent in any formal organisation.
- Permit the application of the concept of specialization and division of Labour, division of work amongst individuals according to their capabilities helps in greater specializations and division of work.
- Create more group cohesiveness
Characteristics of a formal organisation
- Well defined rules and regulation
- Arbitrary structure
- Determined objectives and policies
- Status Symbol
- Limitation on the activities of the individual
- Strict observance of the principle of Co-ordination
Distinction from informal organizationThe informal organization is the interlocking social structure that governs how people work together in practice. It is the aggregate of behaviors, interactions, norms, personal and professional connections through which work gets done and relationships are built among people who share a common...
Formal rules are often adapted to subjective interests — social structures within an
enterpriseAn organization is a social arrangement which pursues collective goals, which controls its own performance, and which has a boundary separating it from its environment...
and the personal goals, desires, sympathies and behaviors of the individual workers — so that the practical everyday life of an organization becomes
informal. Practical experience shows no organization is ever completely rule-bound: instead, all real organizations represent some mix of formal and informal. Consequently, when attempting to legislate for an organization and to create a formal structure, it is necessary to recognize informal organization in order to create workable structures. However, informal organization can fail, or, if already set in order, can work against mismanagement.
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. But in modern societies, formal organizational structures arise in highly institutional contexts. Organizations are driven to incorporate the practices and procedures defined by prevailing rationalized concepts of organizational work and institutionalized in society. Organizations that do so increase their legitimacy and their survival prospects, independent of the immediate efficacy of the acquired practices and procedures. There can develop a tension between on the one hand, the institutionalized products, services, techniques, policies, and programs that function as myths (and may be ceremonially adopted), and efficiency criteria on the other hand. To maintain ceremonial conformity, organizations that reflect institutional rules tend to buffer their formal structures from the uncertainties of the technical activities by developing a loose couplingThe notion of loose coupling is found in computer systems, and was introduced into organizational studies by Karl Weick. Sub-areas include the coupling of classes, interfaces, data, and services.- Loose object coupling in computing :...
between their formal structures and actual work activities. - (John Meyer and Brian Rowan, 1976)
The Hawthorne Experiments
The deviation from rulemaking on a higher level was documented for the first time in the Hawthorne studies (1924-1932) and called
informal organization. At first this discovery was ignored and dismissed as the product of avoidable errors, until it finally had to be recognized that these unwritten laws of work of everyday life often had more influence on the fate of the enterprise than those conceived on
organizational chartAn organizational chart is a diagram that shows the structure of an organization and the relationships and relative ranks of its parts and positions/jobs. The term is also used for similar diagrams, for example ones showing the different elements of a field of knowledge or a group of languages...
s of the executive level. Numerous empirical studies in
sociologicalSociology is the scientific or systematic study of human societies. It is a branch of social science that uses various methods of empirical investigation and critical analysis to develop and refine a body of knowledge about human social structure and activity, often with the goal of applying such...
organization research followed, ever more clearly proving this, particularly during the
Human Relations MovementHuman Relations Movement refers to those researchers of organizational development who study the behavior of people in groups, in particular workplace groups. It originated in the 1920s' Hawthorne studies, which examined the effects of social relations, motivation and employee satisfaction on...
. It is important to analyze informal structures within an enterprise to make use of positive innovations, but also to be able to do away with bad habits that have developed over time.
Reasons for informal organization
There are many different reasons for
informal organizationThe informal organization is the interlocking social structure that governs how people work together in practice. It is the aggregate of behaviors, interactions, norms, personal and professional connections through which work gets done and relationships are built among people who share a common...
:
- Informal standards: personal goals and interests of workers differ from official organizational goals.
- Informal communication: changes of communication
Communication is a process of transferring information from one entity to another. Communication processes are sign-mediated interactions between at least two agents which share a repertoire of signs and semiotic rules. Communication is commonly defined as "the imparting or interchange of...
routes within an enterprise due to personal relations between coworkers.
- Informal group: certain groups of coworkers have the same interests, or (for example) the same origin.
- Informal leaders: due to charisma
The word charisma refers to a trait found in persons whose personalities are characterized by a personal charm and magnetism , along with innate and powerfully sophisticated abilities of interpersonal communication and persuasion...
and general popularity, certain members of the organization win more influence than originally intended.
- Different interests and preferences of coworkers.
- Different status of coworkers.
- Difficult work requirements.
- Unpleasant conditions of work.
Managerial organization theory often still regards informal organization as rather disturbing, but sometimes helpful. In the opinion of
systems theorySystems theory is an interdisciplinary theory about the nature of complex systems in nature, society, and science, and is a framework by which one can investigate and/or describe any group of objects that work together to produce some result. This could be a single organism, any organization or...
and
cyberneticsCybernetics is the interdisciplinary study of the structure of regulatory systems. Cybernetics is closely related to control theory and systems theory...
, however, formal organization fades into the background and only serves, if necessary, to supplement or to correct. Changes in structure always redevelop because of the conduct and differences among coworkers, and the ability of self-organization is recognized as a natural characteristic of a social system.
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