Informal groups | Types | Functions | Merits & Demerits

How do Informal groups form?

Informal groups are created in the organization because of operation of social and psychological forces operating at workplace. Informal groups develop apart from officially prescribed plan of the organization.

Informal groups arise rapidly on the basis of friendship or some common interest which may or may not be work related. There are informal groups of operatives. Informal organization tends to develop when formal organization proves to be inefficient or when it fails to satisfy important psychological and social wants and aspirations of the members in the work environment.

Types of Informal Groups

According to their characteristics, they can be classified into four groups namely,

  1. Apathetic groups
  2. Erratic groups
  3. Strategic groups, and;
  4. Conservative groups.

1. Apathetic groups are least active, have fewest grievances and do not engage in concerted action against management. They are characterized by dispersal and unaccepted leadership, lack of cohesiveness, internal disunity and conflict and suppressed dissatisfaction.

2. Erratic groups are characterized by rapid inflammability, poor control, inconsistent behavior, centralized autocratic leadership and union formation activities.

3. Strategic groups are characterized by well-planned and consistent grievances. They act as shrewd, calculating groups that put continuous pressure on management in order to attend to their problems.

4. Conservative groups are characterized by moderate internal unity, limited pressure for highly specific objectives and a sense of self-assurance.

Dalton has classified informal groups into three categories namely, horizontal, vertical and mixed.

  • Horizontal groups comprise of members who belong more or less to the same rank and are in lateral relationship with one another.
  • Vertical groups have members who belong to the one and the same department and are in superior-subordinate relationship.
  • Membership of Mixed groups is drawn from people working in various departments and at various levels of hierarchy.

Functions of Formal groups

Informal organizations exist because they perform certain desired functions for their members. Informal groups help their members in fulfilling the following requirements through their groups membership

1. Affiliation need,

2. Needs to establish a sense of identity and enhance self-respect,

3. Security need

4. Need to validate their beliefs and values,

5. Need for help in solving work problems,

6. Need to get information, and

7. Need for support for individual innovation and originality.

Advantages of formal groups

The different advantages of informal groups may be outlined as follows:

1. Informal Groups create pleasant work environment for its members.

2. All the needs and desires of the members are easily satisfied.

3. Work performance becomes easier on account of mutual cooperation.

4. They provide psychological support to their members.

5. Communication is facilitated.

6. It establishes group standards of performance.

7. Need for close supervision is also minimized.

8. Groups lead to organization and development, and facilitate research and innovation.

9. Group cohesiveness reduces employee turnover and absenteeism.

10. It develops group spirit and pride.

11. Members of highly cohesive groups feel less nervous.

12. Grapevine complements and supplements official communication, and

13. Groups helps to safeguard their members from outside pressure.

Disadvantages of Informal Groups

Some of the disadvantages of informal organizations are as below:

1. Informal Groups often establish production norms below the physical capabilities of their members.

2. Groups insist on the observation of the groups norms.

3. Groups cohesiveness impedes acceptance of new employees.

4. Groups often hide their innovations from management and adopt them in their own interest.

5. Groups often oppose the management policies and procedures.

6. Groups often spread rumors affecting the smooth functioning of the organization.

7. Groups often demand a price for co-operation.

8. Jurisdictional disputes among groups create problems for management.


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