In: Operations Management
Formal Organsiations refer to the structure of the organisation which works on the basis of authority-responsibility realtionship. This is the organisation which works on the formal communication and patterns and follows a scaler chain for the communication and decision making patterns. In this type of organisation, the power is being allocated with the authority of the organisation. The power is assigned as per the scaler chain, the authority and the level and the position the one is having in the organisation.
On the other hand, informal organisation refer to the structure in which the organisation doesn't follow the scalar chain to make the communication and the decision making commitments. In this, organisation, people follow the informal patterns like grapevine and not any structured patterns to communicate or decision making. The power is being allocated on the basis of the group leader and how he is percieved by everyone. The strengths and the skills one is having and one is deserving would give him the power to be the leader.