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Formal, informal organization and principles
Short answer
A formal organization is a deliberately designed structure with defined authority and rules; an informal organization arises spontaneously from social relationships. Principles include unity of objective, division of work, unity of command, scalar chain, span of control, authority–responsibility parity, delegation, coordination, flexibility, and efficiency.
Define formal and informal organization. Discuss the principles of organization.
Formal organization
A formal organization is a deliberately designed structure with defined authority, responsibility, rules and relationships, created by management to achieve organizational goals. Example: the organization chart of Nepal Telecom from the Managing Director down to technicians, with written job descriptions.
Informal organization
An informal organization is the network of personal and social relationships that grows spontaneously among employees, outside the official chart. Example: a group of engineers who have lunch together and share work advice, or friends from the same district.
| Basis | Formal | Informal |
|---|---|---|
| Creation | Planned by management | Arises naturally |
| Based on | Rules and positions | Personal liking and interests |
| Authority | Flows from top | Flows from group acceptance |
| Communication | Official channels | Grapevine |
| Documented | Yes, chart and manuals | No |
Principles of organization
- Unity of objective: Every unit should support the common goal.
- Division of work: Work is divided by specialization.
- Unity of command: One person, one boss.
- Scalar chain: Clear line of authority from top to bottom.
- Span of control: Limited number of subordinates per manager.
- Authority equals responsibility: Responsibility should not exceed or fall short of authority.
- Delegation: Authority is passed to lower levels.
- Coordination: Efforts are integrated for harmony.
- Flexibility: Structure must adjust to change.
- Efficiency: Objectives are achieved at the lowest cost.
A manager should use the informal group positively (for feedback and morale) while keeping formal rules clear.
✓ Answer checked by Claude Opus 5.5 (high effort)
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