Types of Formal And Informal Organizations

Meaning. Formed by Whom.? Characteristics.

By: Tushar Uniyal

Meaning
Formal Organization is formed when two or more persons come together. They have a common objective or goal.They are willing to work together to achive similar objective. A Formal Organization has a system of coordination and authority. Athe oojectives are well defined and specific. For Example: A company, a school, a college, a bank etc..

Informal Organization
Informal Organization exists within the Formal Organization. A Network of personal and social relationships. People working and traveling eating together become good friends and thus form Groups. These Groups are the informal organizations. It has no system of co-ordination and authority.

Formed By Whom.?
Formal organizations are formed by the Top level management. The owners, CEOs are the rules as well as formal organization makers. Whereas informal organizations are formed by special forces within the formal organization.

Rules and Regulations

The members of formal organization have to followcertain rules and regulations. These rules are made by the formal superiors. Themembers of informal organizations donot have to follow any rules and regulations. They work in their own circle of comfort within the informal organization.

Duties And Responsibilities

In a Formal Organization, the duties, responsibilities, authority and accountability of each member is well defined. In a formal organization there are no fixed duties, responsibilities, authority, accountability etc. for the members.

Objectives or Goals
In a formal organization, the objectives or goals are specific and well defined. The main objective of a formal organization are productivity, growth, and expansion. In an informal organization, the objectives are not specific and well defined. The main objectives of an informal organization are friendship, security, common interest, individual and group satisfaction etc.

Benefits for Members

The members of the formal organization get financial benefits and perks like wages or salaries, bonus, travelling, allowances, health insuarance etc. The members of informal organization gets social and personal benefits like friend ciecle, community, group. Etc.

Thank you.