Informal Organisation: In the words of Keith Davis, “Informal organisation is a network of personal and social relations not established or required by the formal organisation but arising spontaneously as people associate with one another.”
Features of Informal Organisation:
a) It is not established by any formal authority. It arises from the personal and social relations amongst the people working in the organisation.
b) Informal Organisation arises unintentionally, and not by deliberate or conscious efforts.
c) It is influenced by the personal attitudes, emotions, likes and dislikes, etc. of the people in the organisation.
d) It is based on rules, regulations and procedures.
e) The existence of informal organisational structure depends on the formal organisation structure.
Benefits of Informal organisation:
a) It helps the formal organisation to make a workable system to get the work done.
b) It assists the formal organisation to become humanistic.
c) It helps the group members to attain specific personal objectives.
d) It provides social satisfaction to group members.
Drawbacks of Informal Organisation:
a) The communication in informal organisation may, sometimes, lead to rumours.
b) Informal organisation may put resistance to changes and innovations.
c) It may not effectively contribute to the attachment of the objectives of the enterprise.