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Differentiate Between Formal and Informal Organization on the Basis of the Following: Meaning - Business Studies

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प्रश्न

Differentiate between formal and informal organization on the basis of the following:

Meaning

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उत्तर

Basis for
Difference
Formal Organisation Informal Organisation
Meaning Organisational structure which is designed by the management to accomplish a particular task. It specifies the boundaries of authority and responsibility and there is a systematic
coordination to achieve organisational goals
Interaction among people at work gives rise to a network of social relationships among employees. It emerges from within the formal organisation when people interact beyond their officially defined roles.
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2013-2014 (March) All India Set 1

वीडियो ट्यूटोरियलVIEW ALL [1]

संबंधित प्रश्न

Name the type of organisational structure which promotes flexibility and initiative.


Differentiate between formal and informal organisations on the basis of  authority


What is meant by the divisional structure of an organisation?


State any two disadvantage functional structure of an organisation


A differential between 'Functional and 'Divisional' structure of organising on the basis of the following:

Cost involved


A company, which manufactures a popular brand of toys, has been enjoying good market reputation. It has a functional  organisational structure with separate departments for Production, Marketing, Finance, Human Resources and  Research and Development. Lately to use its brand name and  also to cash on to new business opportunities it is thinking  to diversify into manufacture of new range of electronic toys  for which a new market is emerging. Which organisation  structure should be adopted in this situation? Give concrete  reasons with regard to benefits the company will derive from  the steps it should take.


A company X limited manufacturing cosmetics, which has  enjoyed a pre-eminent position in business, has grown in  size. Its business was very good till 1991. But after that,  new liberalised environment has seen entry of many MNC’s  in the sector. With the result the market share of X limited  has declined. The company had followed a very centralized  business model with Directors and divisional heads making  even minor decisions. Before 1991 this business model had  served the company very well as consumers had no choice.  But now the company is under pressure to reform. What  organisation structure changes should the company bring  about in order to retain its market share? How will the  changes suggested by you help the firm? Keep in mind that  the sector in which the company is FMCG.


Which of the following is not the disadvantage of the formal organisation?


A tall structure has a ____________.


Grouping of activities on the basis of functions is a part of ____________.


As the span of management increases in an organisation, the number of levels of management in the organisation:


A tall structure has a


In what way an informal structure would benefit the organization?


Which of the following gives shape to the organisation structure?


Read the following text and answer the questions given below:

'Pappu Sweets Makers' is a sweets making company which has turnover in crores. In order to manage the work in the organisation, the departments have been created on the basis of functions. Examine the following situations of this organisation and give answers accordingly :

Situation 1: It is expected that employees who are performing similar tasks work under the same department. So the company now has HR, Marketing and Finance departments. The division is based on specific functions.

Situation 2: There are similarities in the tasks performed within the same department.

Situation 3: The profit is increasing month by month due to the success of this structure of the organisation.

Situation 4: There has been minimum duplication of efforts as the same department is taking care of single function.

Which type of organisation structure is discussed in the above case?


Read the following text and answer the questions given below:

'Pappu Sweets Makers' is a sweets making company which has turnover in crores. In order to manage the work in the organisation, the departments have been created on the basis of functions. Examine the following situations of this organisation and give answers accordingly :

Situation 1: It is expected that employees who are performing similar tasks work under the same department. So the company now has HR, Marketing and Finance departments. The division is based on specific functions.

Situation 2: There are similarities in the tasks performed within the same department.

Situation 3: The profit is increasing month by month due to the success of this structure of the organisation.

Situation 4: There has been minimum duplication of efforts as the same department is taking care of single function.

Why do you think the profit is increasing as given in Situation 3?


An organization structure is deliberately designed by the top management to facilitate smooth functioning of the organisation. Which of the following is not a feature of such a structure?


Diligent developers, a website design company in Bangalore is a startup initiative of Mr. Maniraj which aims at achieving a profit margin of 10% in its first year. Mr. Maniraj appointed Mr. Advait as the Digital marketing Head, Mr. Kiyansh as the head of Backend department and Mr. Nirved headed the Graphics Designing Department. Since each head was specialised in specific skills, it resulted in increased efficiency and better coordination.

However, problems arose when Mr. Advait started considering group objectives superior to organisational objectives and stopped exchanging information with Mr. Kiyansh and Mr. Nirved. The company had to bear the brunt of lack of coordination and was unable to achieve its objectives.

  1. Identify and state the organisational structure adopted by the company.
  2. State two benefits and two limitations of the identified structure highlighted in the above case.

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