Organising — Part 2: Formal and Informal Organisation, Delegation and Decentralisation: visual lesson, ISC Class 12 Commerce

Lesson

Formal, Informal, Delegation and Decentralisation

Part 2: formal and informal organisation, delegation of authority, and centralisation and decentralisation.

In this lesson you will

Distinguish formal from informal organisation and explain how each affects work
Explain the elements of delegation and its importance
Compare centralisation and decentralisation, and distinguish delegation from decentralisation

Part 2 at a glance

Concept

Formal organisation is the structure of jobs and authority deliberately designed by management.

Table of the meaning, features, merits and limits of formal organisation
Formal organisation	Points
Meaning	Structure of jobs and authority deliberately designed by management
Features	Written duties; official chart; follows the scalar chain
Merits	Easy to fix responsibility; avoids duplication; gives stability
Limits	Delays; ignores social needs; discourages initiative

Concept

Informal organisation is the network of relationships that grows naturally from social interaction at work.

Table of the meaning, features, merits and limits of informal organisation
Informal organisation	Points
Meaning	Network of relationships that grows from social interaction
Features	Not planned; not on the chart; communicates through the grapevine
Merits	Fast communication; meets social needs; fills gaps in rules
Limits	Rumours; may resist change; group pressure