Functions of Informal Organisation

Informal organisation is a psycho-social system and helps the organisation in the following ways.


1)     Filling in gaps in managerial abilities : Informal organisation may fill in gaps if any in the abilities of managers. For example, if a manager is weak in planning his subordinates may help him informally in such a situation.


2)     Solving work problems : Informal organisations help in solving work problems of members. It allows sharing knowledge and taking decisions which may affect a number of jobs.


3)     Better coordination : Informal groups evolve short cuts and eliminate red-tapism. They facilitate smooth flow of information and quick decision making. All these ensure better coordination among various individuals and departments.


4)     Channel of communication : Informal groups often fill up communication gaps which might arise in the organisation. Informal communication cuts across the hierarchical and departmental boundaries and transmits information with greater speed. Management can use informal channels, to share information with the workers and get their reaction to management proposal.


5)     Restraint on managers : Informal groups do not allow managers to cross the limits of authority. They resist them from exercising unlimited power and correct using their power injudiciously.


6)     Better relations : A manager can build better relations with his subordinates through informal contacts. He can consult the informal leaders and seek their cooperation in getting the things done from the workers.


7)     Norms of behaviour : Informal groups develop certain norms of behaviour which differentiate between good and bad conduct and between legitimate and illegitimate activities. These bring discipline and order among the employees of the organisation.


8)     Developing future executives : Informal groups recognise talented workers as their leaders. Such leaders can be picked up by the management to fill vacancies at the junior executive level in future.


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