Introduction to Business

Importance of a company’s informal organization

            Informal organization of a company refers to the interlocking social structure governing how people work in an organization. Importance of informal organization arises from the functions carried out by informal groups and they are as follows; it has influence on job satisfaction and productivity. It is a way through which workers feel a sense of belonging. It is also important because in meeting the personal needs of the members, which cannot be met by formal structure. It boosts productivity; this is because when employees feel at home while at workplace, it will have a positive impact on their productivity. They will focus on their work in a better way, hence achieving the targets (Griffi, 2007). There is easy accessibility in an informal organization and employee issues cannot be buried under layers of hierarchy but rather reach the top management at a proper time because there are no layers of hierarchy to block your issue from reaching the top management. Anyone irrespective of one’s role can easily contact the top management and share opinions. This structure of the organization improves communication by encouraging employees to ask questions share their feedbacks on specific issues, thus reducing chances of misunderstanding, which strengthens trust within the organization. It also enhances collaboration as communication channels are established that bring teams in one page making them struggle to achieve a common objective (Griffi, 2007). There is also flexibility in the working environment for instance the employers understand their employees’ problems and offer them a room to address, thus many employees love to work in a flexible environment

Some of the drawback and benefits of the informal organization

Drawbacks

            Certainly, not everything about informal organization is good. In some organizations, this structure serves as a forum for rumor mongering and other bad behavior such as bullying and backstabbing (Ebert & Griffin, 2003). When employees do not fulfill their roles, the organization might rely heavily on the leadership chart hence less flexibility.

Benefits
            The informal structure is always considered as the most important corporate structure since it reveals the actual operation of the organization. It is an indicator of a healthy organization characterized by teamwork and proper communication. Finally, it helps employees make sense of communication flow (Ebert & Griffin, 2003).

References

 Ebert, R. J., & Griffin, R. W. (2003). Business essentials. Upper Saddle River, N.J: Prentice Hall.

Griffi, (2007) introduction to business. Published by Prentice Hall, 2007