Principles and practice of management question and answer

Informal groups develop spontaneously as employees interact in the work place.

a) Analyse the operations of informal groups indicating their benefits to an organization

b) Explain the disadvantages of informal groups


An informal group in a set of evolving relationships and patterns of human interaction within and organization which are not officially prescribed. It arises out of spontaneous, personal and social relationships between individuals formed on the basis of personal attitude, values, friendships, similarity of work, likes and dislikes etc.

Informal organizations provide social satisfaction to people and help preserve the integrity of the work group.

Success is management depends on how well informal organizations are put into use. Formal organizations emphasize on positions in terms of authority while informal organization emphasize on social relationships/interactions at workplace.

i. They are unofficial arising spontaneously without official sanctions management.
ii. They arise through social interaction between people within the organization.
iii. They are structure less and ill-defined.
iv. Their tasks and goals are mainly centered around individuals and group satisfaction.
v. They are personal with emphasis on people and their social relationships within the organization
vi. They have unwritten conventions and norms.
vii. They find no place in organizational charts and manuals.
viii. They are relatively unstable and unpredictable based on man’s quest for social satisfaction.
ix. One person can be a member of several informal groups of his choice.

1. Provision of social satisfaction
Informal organizations give employees recognition status and further opportunity to relate to one another. They therefore provide an outlet for employee relations.
2. Provides an additional channel of communication (grapevine)
3. Assists in accomplishing work reducing managerial workload especially where thee manager has the full support from the informal organizations.
4. Help remove weaknesses that may exist in the formal organizational structure: there is usually a longer communication channel in the formal structure and therefore information may take much longer to reach the lower levels of management. Grapevine that exists in the informal structure will ensure that the workers are updates as far as the information needs are concerned.
5. It lengthens the effective span of management resulting in reduced supervising costs.
6. It encourages better management since informal organizations blend well with the formal systems to make a workable system for getting work done.
7. It gives stability and satisfaction to the work group since it acts as a means which workers achieve a sense of belonging and security.
8. It acts on a safety valve for workers’ destinations and other emotional problems.


1. Resistance to change:
An informal group has a tendency to evolve its own work, methods and procedures. Any threat of change to these procedures is usually resisted because this is seen as a threat to the existence of the group/organization.

2. Rumours
Informal groups may engage in rumours which can be destructive to the organization.

3. Conformity
Informal groups encourage conformity group members thereinhibiting critical evaluation capabilities of its members. Sometimes they may limit production levels of members and those who exceed set levels may be dubbed rate busters.

4. Informal groups increase the time required to complete activities since obedience to orders is not automatic.

5. Role conflict.
The quest for social satisfaction of group members may move the organization away from goal attainment i.e. the demand for 11/2 hrs of lunch break results into reduced productivity for the organization.

6. Informal groups encourage negativism and hence result into frustration and lack of motivation its members.

7. Informal groups generate interpersonal and group rivalries that may result in conflict in the organization. Managers have no power to abolish informal organizations. They must try to understand their good and bad qualities and deal with it intelligently to serve the organizational purpose.

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