FORMAL AND INFORMAL ORGANIZATION

GROUP DYNAMICS
• The social process by which people interact face-to-face in small groups is called
group dynamics. The word “dynamics” comes from the Greek word meaning
“force”; hence group dynamics refers to the study of forces operating within the
group.

HISTORICAL LANDMARKS IN UNDERSTANDING GROUP DYNAMICS

• Research of Elton Mayo and his associates in the 1920s and 1930s which
showed that workers tend to establish informal groups that affect job
satisfaction and effective
• Experiments of Kurt Lewin, the founder of the group dynamics movement, in the
1930s which showed that different kinds of leadership produced different
responses in groups.

COMPARISON OF INFORMAL AND FORMAL ORGANIZATION

INFORMAL FORMAL
BASIS OF COMPARISON
ORGANIZATION ORGANIZATION
General Nature UNOFFICIAL OFFICIAL
AUTHORITY AND
Major Concept POWER AND POLITICS
RESPONSIBILITY
Primary Focus PERSON POSITION
DELEGATED BY
Source of Leader Power GIVEN BY GROUP
MANAGEMENT
Guidelines for Behavior NORMS RULES
REWARDS AND
Source of Control SANCTIONS
PENALTIES

INFORMAL ORGANIZATION
• It is a network of personal and social relations not established or required by
the formal organization but arising spontaneously as people associate with one
another. The emphasis within the informal organization is on people and their
relationship, while the formal organization emphasizes official position in terms
of authority and responsibility.
HOW DOES THE INFORMAL ORGANIZATION EMERGE?
• The informal organization emerges from within the formal structure as
predictably as flowers grow in the spring. The result of this combination is
different from what managers may have expected in at least three ways.
➢ Employees may act differently than required.
➢ Employees often interact with different people or different frequencies
than their jobs require.
➢ Workers may embrace a set of attitudes, beliefs, and sentiments different
from those the organization expects of them.

INFORMAL LEADERS
• The employee with the largest amount of status in the informal organization
usually becomes the informal leader. This person emerges from within the
group, often acquiring considerable informal power.
• Informal leaders may help socialize new members into the organization and
they may be called upon by the group to perform the more complex tasks.

IDENTIFYING INFORMAL LEADERS

• Leadership in an informal group in unclear, at least to outside observers or
managers. However, informal leader often exhibit the following traits which
allowed them to be identified;
➢ They have an identifiable characteristic from the group member (Ex.
Position in the Company, Seniority, etc.)
➢ They have more knowledge and experience when it comes to the
common interest of the group.
➢ They have persuasive personality to which other members of the group
tend to follow them.
➢ They are chosen by the majority of members to be the leader.

BENEFITS OF INFORMAL ORGANIZATION

• When the informal organization blend with the formal system, it make an
effective total system.
• It lighten the workload on management.
• The informal organization also may act to fill in the gaps in a manager’s abilities.
• It also gives satisfaction and stability to work groups.
• Additional benefit is that the informal organization can be useful channel of
employee’s communication.
• It became a safety valve for employee’s frustrations and other emotional
problems.
• The presence of informal organization encourages managers to plan and act
more carefully that they would otherwise.
PROBLEMS ASSOCIATED WITH INFORMAL ORGANIZATIONS
• It can create and spread malicious rumor.
• Resistance to change.
• It can cause conformity within the members.
• Often times, it leads to interpersonal and intergroup conflicts.
• Rejects and harasses some employees.
• Weakens motivation and satisfaction with employee’s job assignment.
• Usual operates outside or beyond the control of the managements.
• It develops role conflicts of the members to the formal structure.

MONITORING THE INFORMAL ORGANIZATION

• Identifying the feelings within a group can be useful for determining who trust
whom, or for selecting an individual to negotiate a satisfactory compromise on a
sticky issue.
• Determining behavioral patterns within informal organization can be done either
through direct observation of interactions, through collecting data on
communication patterns or by directly asking individuals involved.

INFLUENCING INFORMAL ORGANIZATION

• Management can influence members in an informal organization using the
following guidelines:
➢ Accept and understand the informal organization.
➢ Identify the various levels of attitudes and behaviors within it.
➢ Consider possible effects on informal systems when taking any kind of
action.
➢ Integrate as far as possible the interests of informal groups with those of
the formal organization.
➢ Keep formal activities from unnecessarily threatening informal
organizations.

TWO TYPES/DISTINCTION OF FORMAL GROUP

1. Temporary
- It is created to accomplish a short-term task and then disband.
- Examples are task force, Quality Assurance Unit, etc.

2. Permanent (Definite)
- It is a more natural and enduring work group.
- This type of group is formed when people perform tasks together as part of their
job assignment and is called a team.
MEETING
• The event at which group members discuss ideas or solve problems.
• It is very necessary in an organization, but can produce more complexity and
problems when improperly used.

COMMITTEES
• A specific type of group meeting in which members in their group role have been
delegated the authority to handle the problems at hand.

SIZE
• It is the number of members included in a committee.
• Larger committee can represent more relevant points, but special effort and extra
time is needed and required to ensure good communication.

COMPOSITION
• Selection of group members in a committee.
• Various factors such as committee’s objective, the member’s interest level, time
availability and past history of working relationship among potential members
must be consider in selecting members of the committee.

AGENDAS
• There are two levels of agendas during the meeting.
➢ Surface Agendas – it is the official task of the group during a meeting.
➢ Hidden Agendas – It involves the member’s private emotions and motives,
which they have brought but keep hidden.
 LEADERSHIP ROLES
• Group tend to require two types of leadership roles; that of the task leader and
that of the social leader.
Task Leader role
• Define the problem or goal for the group
• Request facts, ideas or opinions from
members
• Provide facts, ideas or opinions
• Clarify a confused situation, gives example
and provide structures
• Summarize the discussion
• Determine whether the agreement has
been reached
Social leader role
• Support the contributions of other and
encourage them by recognition
• Sense the mood of the group and help
member become aware of it
• Reduce the tension and reconcile
disagreements
• Modify member’s position and admit an error
• Facilitate participation of all members
• Evaluate the group’s effectiveness

GROUP STRUCTURES (STRUCTURES APPROACHES)

To ensure that committee meetings will provide greater control over process, four (4)
important alternative structures has been developed.

1. Brainstorming
• This is a popular method for encouraging creative thinking in the group.
• It depend on two main principles
i. Deferred Judgment – All idea, whether practical or impractical, is
collected then later evaluated for usefulness
ii. Quantity breed Quality – This principle encourages people to
propose bold, unique ideas without worrying what other might think
of them.

2. Nominal Group Technique

• It is a process where members have minimal interaction prior to producing
a decision.
• The following are the steps that this technique often follow:
i. Individuals are brought together and presented with a problem;
ii. They develop solutions independently, often writing them on cards;
iii. Their ideas are shared with others in a structure format;
iv. Brief time is allotted so that questions can be asked – but only for
clarification;
v. Group members individually designate their preferences for the best
alternatives by secret ballot;
 vi. The group “decision” is announced.
• The advantage of the nominal group technique includes opportunity for
equal participation by all members, the nondominance of discussion by any
one member, and tight control of tine that the process allows.

3. Delphi Decision Making

• In this structure, a panel of relevant people which are expert or have plenty
of knowledge about the topic is chosen as respondents. Then a series of
questionnaires are sequentially distributed to the respondents, who do not
meet face-to-face. Replies are gathered from all participants, summarized
and fed back to the members for their review. The new information
generated from this process will be used as reference to make a decision.

4. Dialectic Decision Methods (DDM)

• The dialectic process begins with a clear statement of a problem to be
solved.
• Then, two or more competing proposals are generated. The group breaks
into advocacy subgroups, which examines and argue the relative merits of
the proposals.
• Then the participants identify the explicit and implicit assumptions that
underlie each proposal.
• Later, the entire group makes a decision based on the competing
presentations. This decision may mean embracing on of the alternatives,
forging to compromise from several ideas, or generating new proposals.

POTENTIAL OUTCOMES OF FORMAL GROUP PROCESS

1. Support for Decision

• People who participate in making a decision feel strongly motivated to
accept it and carry it out.
• Group decision is more likely to be accepted and carried out by the
members since they are more free from individual prejudice.
• Furthermore, the combine social pressure of the entire group stand behind
the decision.

2. Quality of Decision
• Groups are more effective problem-solving tool. In comparison with an
individual, groups are typically have greater information available to them,
a variety of experiences to draw upon and capacity to examine suggestions
and reject the incorrect ones.
 3. Individual Development
• The presence of other stimulates that a member to perform better.
• Increased participation becomes the product of implied group pressure to
perform or a natural response to seeing others do so.
• As group member sees and hears others perform well, they tend to
duplicate that behavior because of the social rewards it elicit from them.

WEAKNESSES OF GROUPS

1. Slowness and Expensiveness

• Delay on the decision-making for the problems because there is more time
for thinking for a way to get things done.
• But when quick, decisive action is committed, it sometimes lead to a costly
decision due to lack of evaluation.

2. Groupthink
• This is the tendency of a tightly knit group to bring individual thinking in
line with the group’s thinking.
• It occurs when a group values solidarity so much that it fails to critically
evaluate its own decision and assumptions.

3. Polarization
• In contrast to groupthink, an alternative behavior sometimes appear is
called polarization.
• Individuals bring to the group their strong predispositions (either negative
or positive) towards the topic.
• Some members become defensive as their ideas are explored and logic is
challenged.
• As a result, the groups tend to make a risky shift in their thinking.

4. Escalating Commitment
• The idea of this weakness is that the group members may persevere in
advocating a course of action despite rational evidence that it will result in
failure.
• In fact, they may even allocation additional resources to the project,
thereby escalating their commitment despite overwhelming evidence that
it will fails.

5. Divided Responsibility
• Since group decision undoubtedly dilute and thin out responsibilities,
individual members tend to shirk responsibility using the justification “WHY
 SHOULD I BOTHER WITH THIS PROBLEM? I DIDN’T SUPPORT IN THIS
MEETING”.

HOW TO OVERCOME WEAKNESSES OF THE GROUP?

• Distribute the agenda and background material in advance.
• Clarify the objective.
• Compose the group appropriately.
• Encourage the expression of minority viewpoints.
• Separate ideas generation from evaluation.
• Make assumptions explicit/clearly.
• Legitimize questioning attitudes.
• Control irrelevant discussion.
• Test support for decision.
• Evaluate the group’s effectiveness.
• End on a positive note and assign responsibilities.