The Impact of Informal Relationships Forming Within Formal Organizations

Those informal ties affect individuals' thinking and actions, and therefore affect the functioning of organizations positively and negatively. On one hand, informal relationships have several positive effects to organizations. Firstly, informal relationships enable members in an organization to gain a sense of group honor and loyalty, which ensures the pursuit of defined goal of the organization.

For instance, soldiers at war perform effectively and tenaciously because. Еhey intent to fight for their comrade-in-arms who keep close relationships within small groups. Such primary groups enhance member's. Loyalty to each other as well as to the organization. And enable members to pursue organization's goal instead of their own interest. Another example demonstrates that many organizations prefer to recruit family. Members of their current workers or acquaintances. Since employees who are introduced by their families or friends are more likely to show loyalty and responsibility to their work. And a family shows belongings to an organization if many family members are part of the organization for a long time.

Secondly informal ties are beneficial for maintaining an organization's motivation and disciplines. For example, Japanese companies usually hire employees who are sons, daughter or siblings of current workers. And such reliance on families by organizations involves mutual obligation. And encourage Japanese to work hard with low wages (Greenwald, 2008). Since an individual's performance represents not only his or her reputation. But also the family members' reputation. Meanwhile managers in such organizations usually solve conflicts efficiently. Through informal procedures by asking for supervision from the employee's family.

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Thirdly, informal networks can enhances the information exchange. Within or outside the organization and therefore improve the working efficiency. Specifically there are four common role-players who affect the organization's productivity, naming central connectors, boundary pners, information brokers, and peripheral specialists (Cross, 2002). In most cases, they are the invisible go-to people who ensure the transition of information and offer direct help to members. Moreover they build the cooperation among members and even connect the organization with outside environment. If executives become aware of these invisible role-players and offer appropriate rewards to them, the informal networks will boost the productivity.

Lastly the informal relationships are important in building the emotional intelligence organizations. Friendship and community ties of members encourage interpersonal understanding and caring for each other and thus build trust and identity of an organization. And therefore the informal ties could help the organizations gain emotional intelligence with high level of participation, cooperation, and collaboration among members (Druskat, 2001).

On the other hand, some managers view informal social relationships as enemies who negatively affect the function of organizations. At the beginning, the organization's productivity may be reduced as a result of the informal workgroups and family relationships. The Hawthorne experiment conducted by Elton Mayo demonstrated that even with incentives, the workers still do not put more effort into work since the informal work groups decide to stay same workload to prevent losing jobs. Apparently the influence of informal relationships among workers is more significant than pay incentives. Because people are all connected to others in a social context, and no one want to be isolated because of his or her incompatible and asocial actions.

Meanwhile, both the external and internal family relationships lower the organization's productivity to some extent. Since one single individual could have several identities that occasionally become paradox with each other. A person could be a family member and an employee at the same time. And "the sense of obligation that prevails among individuals in external family relationships often contradicts the priorities of formal organizations" (Greenwald, 2008). For instance, a mother barely places the importance of work before that of her children. Moreover such family relationships make people feel uncomfortable about their jobs. Working women suffer a lot presser from their colleagues who believe women should stay at home as housewives.

Also sons are compelled to join their father's company without interest (Kaslow, 1992). Furthermore organizations based upon family members show inefficient in management. The very close relationships in the organization sometimes make people to avoid telling the truth which might hurt someone. Then the information may be blocked or leaked by the informal networks. On one hand sometimes the central connector, one of network role-players in organization, is hoarding information, which creates bottleneck that can hold back the information network (Cross, 2002). On the other hand, some close friendships will cause information leakage when people value interpersonal relationships over organizations. For instance, one person may tell his or her friends about the vacant occupations and thus create unfairness for other people.

Furthermore, the informal ties made executives hard to manage. Primarily since the informal groups are merely invisible, it is hard for executives to aware and to recognize them. Then different social status and income level of groups may cause conflict. In detail, managers with high income hardly join the same group as workers with low income. The misunderstanding among different informal relationships challenges the management.

Overall, informal social relationships can affect the functioning of organizations positively and negatively. And the most significant key for executives is to recognize the informal ties, show them enough respect, and make them serve for the organizations.

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