Formal organization
A formal organization is a structured group of individuals who come together to achieve specific goals, characterized by hierarchical and bureaucratic frameworks. Distinct from informal organizations, which rely on personal relationships and flexible structures, formal organizations prioritize defined authority, codified rules, and clear objectives. Common examples include governments, corporations, schools, and military institutions. As societies evolve, the significance of formal organizations has grown, reflecting the complexities of modern life. Scholars like Max Weber have highlighted the rational and bureaucratic nature of these organizations, though they can sometimes lead to alienation among members. They can be categorized based on their structures—such as entrepreneurial, machine, professional, divisional, and innovative types—each serving distinct operational purposes. Additionally, formal organizations can be classified by the motivations behind membership, including normative (voluntary), coercive (involuntary), and utilitarian (work-related) organizations. While formal organizations maintain a rigid structure, they often incorporate elements of informal organization to foster a more collaborative and adaptive environment. This blending helps create a responsive atmosphere that enhances productivity and job satisfaction.
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Subject Terms
Formal organization
An organization is a group of people who have come together for a specific purpose. Groups of people tend to be classified as primary or secondary groups. Primary groups are based on long-term personal relationships, typically formed by kinship—close and extended family—lifelong friends, and social groups important for identity formation. Secondary groups are brought together by shared interests, exchanges, or activities developed in order to perform some function efficiently. These goal-oriented activities could be related to labor and market exchanges in the workplace, for example. Informal organizations are those in which people interact on a personal level as opposed to formal organizations, which are more structured, hierarchical, and bureaucratic. Therefore, formal organizations are secondary groups. Examples of formal organizations are governments, the military, corporations, hospitals, and schools.
Overview
As society has modernized, formal organizations have become increasingly important. They are structured to reach set goals and accomplish them efficiently. Max Weber wrote extensively about formal organizations, defining them as rational and bureaucratic. Formal organizations, however, may also be alienating and may experience impediments to efficient goal attainment.
Formal organizations have different structures and goals, making them distinct from one another. Organization experts have sought to categorize organizations according to typology. Another way to categorize is by dividing organizations by type using Mintzberg’s Organizational types, which include entrepreneurial, driven by enterprising, creative types; machine, centralized and bureaucratic such as government institutions; professional, which are composed of a high degree of professional or technically-skilled staff; divisional, which are centralized firms with many companies divided into different branches and products such as corporations; and innovative, which have decentralized leadership with cutting-edge strategies.
Formal organizations can also be divided according to the reasons individuals join them: Normative organizations are voluntary associations and include religious, charitable, and political organizations; coercive organizations are those in which people have no choice in joining, such as prisons; and utilitarian organizations such as those that people join for work-related reasons, such as businesses or to trade in the market.
Regardless of type, most organizations have a formal structure in place, which includes a vertical relationship between members where the lines of authority are clear and power flows from individuals at the top to their subordinates below. There are some key characteristics shared by formal organizations such as well-defined lines of authority, goals and objectives, codified rules and regulations, and hierarchical and bureaucratic structures.
Informal organizations may coexist in the formal organization. Often, the informal organization may complement the formal organization as in the personal relationships formed between individuals in the workplace. Informal organizations, however, do not share the key characteristics of formal organizations. They are based on sharing interests, social and cultural values, and personal communication, and their structures are flexible, evolving, and lacking in vertical authority. Modern formal organizations increasingly utilize characteristics of informal organizations in order to create a more fluid, dynamic, satisfactory, and productive work environment.
Bibliography
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