Home > Organizational Behaviour > Formal and Informal groups- P.J. Philip

Formal and Informal groups- P.J. Philip

October 30, 2010 Leave a comment Go to comments

Lecture on Formal and Informal Groups by P.J.Phillp

Adapted by Navendu K. Sharma

Our discussion today is based on the social groups that we come across within an organization. These groups can be broadly be classified into two:

Formal Groups and Informal Groups

Formal Group: A formal group is the deliberate and systematic grouping of people in an organization so that organizational goals are better achieved.

Now any organization would have a certain formula. They are very essential for the efficient functioning of the organization.

What does an organization do?

The total no. of people working in an organization is divided into smaller groups (teams or sections or departments) and each group is responsible for fulfilling a task which would ultimately contribute to fulfilling the organization’s goal. This increases the efficiency of the organization.

Ex: If we take NITK as an example, we all know that we have a larger goal of training students for the engineering profession. But within this larger goal, we want students to be trained for computer engg, electrical, mech, etc. So this larger goal is divided into departments (example computer department), which is a formal group in this larger organization. So, all the departments together achieve the goal of efficiently training the students for engineering purpose.


Informal Group: Informal groups are the natural and spontaneous grouping of people whenever they work together over a period of time.

Whenever people interact and work together over a certain period of time, it’s very natural for them and it comes very spontaneously for them, that they form informal groups.

For example, we are officially assigned to the computer engineering department. But in the hostel, we live with friends from other branches. So when all of us live together for a 4 year period, it’s very natural for us to interact and build up groups informally with our friends from other branches.

So like this, any organization would have informal groups.












Let’s compare both Formal and Informal Groups:


  1. Deliberately created.

Formal groups are knowingly and systematically created.

Spontaneously created.

Informal groups are not really created, they are naturally formed.

  1. Systematic structure.

As we discussed earlier, in the computer department, we have HOD, OFFICE STAFF, etc. So there is a system in place.

Loose structure

In informal groups, there is no structure at all. They just come together for some time. There is no junior and senior…everybody is equal.

  1. Importance to position.

In a formal group, importance is always given to the position. Ex: the group leader, the head of department, etc. The position gets importance in a formal way because there is a system in place.

Importance to the person.

The beauty of being in an informal group is that the position does not exist at all because there is no structure. So importance is always given to the person.

  1. Relationship is official.

The relationship is very formal and official in a formal group. So the relationship and behavior is almost prescribed in a formal group.

Relationship is personal.

In an informal group, the interaction and the attachment becomes very personal and not official.

  1. Communication is restricted and slow.

By restricted we mean that the “boss may decide that certain information should not be discussed below a certain level.”

Communication is very slow because a certain procedure has to be followed if we want to pass down the information.

Communication is free and fast.

Everybody wants to tell everyone all the information. With the gossip network in an informal group, information is passed very quickly.


Importance of formal groups:


As human being, we tend to tilt towards informal groups. But  we have to remember that formal groups have certain characteristics that are very essential for the efficiency of the organization.

For example: If we remain informal all the time, the organizational goals cannot be met.


Importance of informal groups:


Informal groups are just as important because they serve some very important human means.


  1. Informal groups help in developing good human relations in the organization.

When we interact with people in an informal scale, we develop good relationships with them . So this develops better working relationships and therefore creates better efficiency in the organization. So, good organizations today are promoting informal activities and formation of informal groups.   Ex: Parties in companies, which promotes informal interaction.



  1. Informal groups promote human dignity.

Human dignity is something which is very important for every human being.  As human beings, we want to be respected and treated in a particular way. So, self respect is very important for a human being.  In a formal group setup, very often, our dignity is destroyed.

For example: If we have a very bossy boss, everyday he will be de-motivating you by saying things like “You are useless fellow!! Who made you an engineer”!!

So our dignity is destroyed. But what supports us?? It’s the informal group that supports us and keeps up our dignity.

For example: The support from our friends helps us to keep our dignity.


  1. Informal groups help in spreading information fast through the GRAPEVINE-the informal network of communication (“The gossip network”).

The grapevine is the plant on which the grape fruit grows.  The characteristic of a grapevine is that it grows in all directions. So in an organization, the grapevine is the informal communication network that has grown into every group and corner of the organization.

If we want information to be passed on very fast to everybody in the organization, then the grapevine is the best way.

Example 1: “We can put information on a notice board”

Example 2: When director makes an announcement for a holiday, information is passed very quickly. So the grapevine is active. And if a formal notice is made, then it takes time for the information to reach everybody because the formal network is very slow.




*A good organization should have a combination of both the formal and the informal.

  1. January 2, 2011 at 10:54 am

    hope u will continue posting such information it is a great help for us students whom doesnt hve books or cannot afford to have books .., thank ypou and more power…

  2. naveen
    November 13, 2011 at 7:05 am

    Thanks for telling about groups.

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