Meaning: It refers to the natural groupings of people in the work situation to meet personal needs.
Advantages:
i. Effective Communication: In the absence of any definite course, it is an effective system of communication. Messages can be quickly conveyed from one place to another with the help of this system.
ii. Fulfills Social Needs: In the informal organisation, people having similarity of thoughts and ideas form a group of their own. All the people in the group stand by one another in all the organisational or personal matters.
Limitations:
Following are the limitations of Informal Organisation:
i. It creates Rumours: All the persons in an informal organisation talk carelessly and sometimes a wrong thing is conveyed to the other person which may bring in horrible results.
ii. It resists Change: This organisation resists change and lays stress on adopting the old techniques.
