Association among individuals at work offers ascend to a ‘system of social connections among representatives’ known as the casual association. Informal organisation emerges from within the formal organization when people interact beyond their officially defined roles. When people have frequent contacts they cannot be forced into a rigid formal structure. Rather, based on their interaction and friendship they tend to form groups which show conformity in terms of interest. Examples of such groups formed with common interest may be those who take part in cricket matches on Sundays, meet in the cafeteria for coffee, are interested in dramatics etc. Informal organisation has no written rules, is fluid in form and scope and does not have fixed lines of communication. The Table in the next page compares informal organization with the formal organisation to provide better understanding of both types. Informal organisation can be better understood with the help of the following features:
(a) An informal organisation originates from within the formal organization as a result of personal interaction among employees.
(b) The standards of behavior evolve from group norms rather than officially laid down rules and regulations.
(c) Independent channels of communication without specified direction of flow of information are developed by group members.
(d) It emerges spontaneously and is not deliberately created by the management.