FORMAL AND INFORMAL

ORGANIZATIONS
 Whether an organization is firmal or informal is determined by the
kind of relationships that prevail in each organization type.

Formal Organizations
- Organizations formed by the company owner or manager to help the
firm accomplish its goal.

Informal Organizations
- Organizations that exist because of friendship or common interest.
Formal Organizations have the following functions:
1. Accomplish goals that require cooperations or collaborations
aamong formal groups in the organization.
2. Produce or bring out new and creative ideas and solutions to
company problems.
3. Coordinate interdepartmental activities.
4. Implement company rules and regulations and policies
5. Orient or train new employees.
Meanwhile Informal Organizations have the following
functions:

1.Satisfy the members need for affiliation.

2.Give the individual memebers an opportunity to share their
ideas.
3.Leesn indivdiual member’s insicurities.
4.Give the individual a chance to develop self-esteem.
5.Provide a mechanism to solve member’s personal and
intrapersonal problems.
 FORMAL INFORMAL
A 1. Working systematically. 1. Fast communication due to the the
D 2. Establish on and for the organizations absence of standards operating
V objectives. procedures and protocols.
A 3. No duplication or overlapping of work. 2. Give mportance to the pshycological and
N
4. Efficient coordination among social needs of employees.
T
A
departments. 3. Top managers can solicit feedback directly
G 5. Implementation of change of command from the employees on new policies and
E and professional realtionship. plans.
S

D
I 1. Delay in feedback and action due to the 1. More susceptible to rumor mongering.
S established chain of command. 2. Ther is no systematic workflow in place.
A
D 2. Ignores the pshycological and social needs 3. Difficulty in implementing new rules and
V of emmployees. policies.
A 3. Emphasize on work only and overlooks 4. More emphasizxe on the individual
N
T
the human realtions, talents, and creativity interest of each empployee rather than the
A of employees. overall goal of the company.
G
E
S