Difference Between Formal and Informal Organizations PDF

By -- Bhupendra Khotari, Roll no.201703039 Que. Define Organization. Write down the difference between formal and in formal organization Ans. Definition - An organization is a collection of people who work together to attain specified objectives. There are two types of organization structure, that...

By -- Bhupendra Khotari, Roll no.201703039 Que. Define Organization. Write down the difference between formal and in formal organization Ans. Definition - An organization is a collection of people who work together to attain specified objectives. There are two types of organization structure, that can be formal organization and informal organization DIFFERENCE BETWEEN FORMAL & INFORMAL ORGANIZATION **Basis of difference** **Formal Organization** **Informal Organization** -------------------------------- --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------- **Meaning** Formal Organization may be defined as such organization in which authority, responsibility and account-ability of each member are clearly defined. On the other hand, informal organization may be defined as such organization in which authority, responsibility and account-ability of each member are not clearly defined. **Objectives** The purpose or objective of establishing formal organization is to achieve Pre-determined goals of an enterprise Where as, the objective of establishing informal organization is just to fulfill the psychological and social needs of its members. **Stability** Formal organization is generally more stable in comparison to informal organization, because it is established according to proper rules and regulations for achieving certain goals. On the other hand, informal organization is not as stable as formal organization, because it is established, in the lack of proper rules and regulations. **Need** Formal organization is gene-rally more needful to every organization, in comparison to informal organization due to stability. On the other hand, informal organization is not as essential to every organization as formal organization due to absence of proper suitability. **Size** Formal organization is generally too large in size, in comparison to informal organization. On the other hand, informal organization is generally too small, in comparison to formal organization. **Establishment** Formal organization is established on the basis of proper rule and regulation, where authority, responsibility and accountability of each member are clearly defined. On the other hand, informal organization is established spontaneously. It doesn\'t require any rule and regulation to emerge. **Use of Organization charts** Organization charts is needed to show formal organization. There is no use of organization charts in informal organization. **Types of Communication** In formal organization generally written or formal communication takes place to express the orders, views and feedback etc. On the other hand, in informal organization generally oral or informal communication takes place to express the orders, views and feedback etc. **Flow of authority** n formal organization gene-rally authority flow from top to bottom vertically over the subordinates and responsibility goes from bottom to top over superiors. On the other hand, in informal organization everyone has equal rights and duties, so there is horizontal flow of authority in this organization. **Leader** In formal organization gene-rally managers are the leader of organization and so, each and every activity is done under their guidance. On the other hand, in informal organization generally leader is elected by the members and so, each and every activity is done by members under his guidance. **Relationship** In formal organization each and every members has impersonal or formal relationship with each-other due to bound in rules. On the other hand, in informal organization each and every member has informal or personal relationship with each-other due to equal rights. **Scope** Formal organization is established on the basis of proper rule and regulation, where authority, responsibility and accountability of each member are clearly defined. On the other hand, the scope of informal organization is narrow in comparison to formal organization. **No. of members** Organization charts is needed to show formal organization. On the other hand, in informal organization there is short list of members due to lack of certain goals.