CIO Development

Blog The Formal, the Informal and the Social Organisation

I would like to revisit the debate on the formal and informal in large organisations. This is an old conversation with a radical new twist as social networks impact how we succeed in the organisations within which we live and work.

Despite the early efforts of the “scientific management” movement of the 1920s, successful organisations have always had to find ways of combining the rational and emotional aspects of their operations. After all people comprise organisations and people are both rational and emotional, so the concept of “formal” and “informal” organisation was created to explain it. Key to this understanding is to accept that both are important in any organisation and both are desirable. It is a question of balance.

In essence, the formal organisation is defined by lines of reporting and authority, usually represented by the organisation chart through dotted and hard line connections. It defines legal accountability and generally reflects grades of seniority and reward. Its mechanisms can be clearly defined through strategy, structures, processes and procedures, programmes and initiatives, performance goals and metrics. All of which are codified for ease of reference.

The informal organisation is more difficult to tie down. It doesn’t have such clear structural boundaries; its elements overlap and they are not usually codified. Nonetheless theorists agree that they are just as essential to the healthy functioning of the organisation. They include: shared values, informal networks, communities and professional pride; all of which are intuitive, personal, emotional and immediate.

The informal organisation is not the opposite of the formal, but complementary to it. It is brilliant at motivating people to contribute beyond their codified job roles, catalysing collaboration and accelerating behaviour change. These are all very difficult if not impossible for the formal structure to control or even to affect very much by itself.

But people in organisations are not only logical and emotional, they are overwhelmingly social. They relate and chat and check with their colleagues constantly, co-creating prevailing trends and opinions and contributing to the corporate culture. Until recently this has only been possible on a local scale, and site placement, co-location of key workers and functions have been issues for the formal organisation to resolve. But with social media in the organisation, we can now relate on a global scale. And management can “formally” consult and get its important messages out on a massive scale too, independent of geography, time and all the other things that social media have made to disappear.

And “massively social” doesn’t mean spending hours every day building relationships with people we will never meet. It refers to emergent ways of leveraging knowledge and experience on a global scale. Whether I am an expert authority, an ambitious learner or a new starter I will be building my professional network and identifying the trusted information sources appropriate to my situation. I will be “connecting”, and the connecting me carries much more potential for value creation than the old “professional” me. Who I can reach, what knowledge and experience I can leverage and interpret, has so much more potential than the things I have done myself.

So we can add an entirely new “massively social” column to the old formal versus informal dichotomy, to the enrichment of both.

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