INTRODUCTION ABOUT THE COMPANY:

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INFORMAL ORGANISATION
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INFORMAL ORGANISATION

• Organization are collections of individuals.
• It refers to unofficial unauthorised
  relationship occurs between the groups
  individuals.
• They exert a powerful influence upon
  productivity.
• They blend with formal system for getting work
  done in a smooth way.
• It arises naturally, spontaneously from the
  interactions of the people not prescribed by the
  structure.

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Reasons for Emergence of Informal Groups

• Propinquity Theory individuals affiliate
  because of geographical proximity. Employees who
  work in same area probably form into group.
• Similarity Theory Acc. to Theodore Newcomb,
  people with similar attitude, interest work
  related needs are attracted to one another.
• Complementarity Theory Acc. to Winch, People
  with complementary needs attracted with one
  another.
• Social Comparison Theory Acc. to Festinger,
  people join group for the need of
  self-evaluation.
• Interaction Theory Acc. to George Homans more
  activities persons share, more stronger
  positive their sentiments have for one another.
• Exchange Theory It is based upon reward-cost
  outcomes of interactions.
• Source of Protection it offers powerful
  protection against threatening oppressive force.

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TYPES OF INFORMAL GROUPS
1) Social Groups comprising employees with
similar work-related needs. 2) Functional Groups
employees who exert influence effect the course
of action. People respect them, solicit
assistance. 3) Decision Groups employees who
are consulted on account of age, mature judgment,
wisdom, experience. 4) Power Groups who have
power as distinct from authority. 5)
Communication Groups comprising those who
occupy central positions

• There are 3 pattern of contact between
  individuals
• Horizontal Contact among members who are at
  same level of management, work in same area.
• Vertical Contact individuals at different
  levels in same line of command.
• Random Contact among members of different
  departments at diff. levels from diff. physical
  locations.

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STAGES OF INFORMAL GROUPS

• Forming- group members establish ground rules ,
  both for task requirement for interpersonal
  relationships.
• Storming- intra group conflict develops, some
  members become hostile towards, ignore group
  goals resist task requirements.
• Norming- uniformity develops, members begins to
  think, work alike, behaviour become standardized.
  3 results
• (i) norms (ii) group pressure (iii) similarity
  of environment
• Performing- last advanced stage of group dev.
• Internal social structure develop
• people observe each other
• groups norms become bench mark to measure
  behavior pattern.

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DISTINCTION BETWEEN FORMAL INFORMAL
ORGANISATION

• FORMAL ORGANISATION
• Prescribed structure of roles
• relationships
• ii) Goal-oriented
• Values task towards
• productivity, growth, profitability,
• efficiency.
• Well-defined in shape,
• clear shape.
• iv) Ranks are clear by titles.
• v) Prescribed written system
• of reward punishment.
• vi) Org. may grow in size.

• INFORMAL ORGANISATION
• Natural structure
• Arising out of
• tendency of people
• iii) Values, goals, task centered
• towards individual satisfaction
• iv) Shapeless, multidirectional,
• Cant be charted.
• v) Ranks are implicit
• vi) Unwritten system of reward
• punishment.
• vii) Tends to remain small.

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Benefits of Informal Organization
To its Members1) Sense of belonging2) Safety
valve for Emotional problems- 3) Aid on the
job4) Breeding Ground for Innovation
originality5) Important channel of
Communication6) Social Control7) Check on
Authority To Management1) Self-Policing-
relieves mgmt. burden, delegate decentralize
authority.2) Fills in gaps in Managers ability-
If Managers week, group help him.3) Gives
feedback about Employees their work
Experience-increase understanding of manger to be
supportive
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Disadvantages of Informal Organization
1) Resistance to change- no chart to bind, but
their customs, culture, conventions bind them.
They resist mgmt. demand.2) Suboptimisation-
Informal groups with different interest needs,
leads members away from org. objectives. 3)
Rumors- informal communication Grapevine4)
Group-thing Philosophy- members begin to worship
their group, a delusion of righteousness
develops.
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"The conventional definition of management is
getting work done through people, but real
management is developing people through work."
"The most important single ingredient in the
formula of success is knowing how to get along
with people."