HR assignment essay on: Informal and formal powers in organization
Introduction
In an organization two types of power exist, one is formal and the other is informal. Both have their pros and cons, but any conflict or disagreement can have a negative effect on the organization. Conflicts can only be resolved by having a good leadership and improving the power structure. The three major types of conflicts are process conflict, relationship conflict and task conflict. There have been instances where power differences affected personal relationships at workplace (Wharton.universian.d.). Power can have both positive as well as negative effects on the performance of the organization. The differences between workforces can be improved by having a single objective that remains in line with the goals of the organization. Power has the capacity to bring changes in one’s behavior that leads to detrimental impact on other activities. Here we are discussing about the impact of power differences in a personal relationship. Though one would agree that due to human nature the differences can have impact on the relationships but there are ways that can help in finding a solution.
Formal Power and Informal Power
Formal Power
Every company follows a well organized chart that lists relationships between people involved in the organization and ranks them according to the chart (Chronn.d.). This chart is developed to assign individual responsibilities to each and every person. It gives authority and creates a formal power system in the company. There are various positions that may be referred to a job function, corporate structure or any position in corporate ladder. All the decision making powers in the company rest in the hands of top management and the people below them need to follow the orders. Coming to the revenue generation part the sales team has many formal functional powers. Even in the small enterprises there is an organizational chart that is not formal but the employees will easily recognize them through the titles, job roles, functions, etc.
Informal Power
Informal power tends to be different and here the person who has good influence is considered to be powerful. It may not be the manager but a person has the ability to the ability to lead others and accomplish a certain goal. In an organization informal power means the ability of a person to achieve, direct or lead without having any official title (Chronn.d.). This can be derived from the relations between the employees and those individual who are respected by others due to some perceived notions seem to enjoy the informal power. Though the top management does not give much importance to informal organization but it is seen that it has huge impact on working dynamics. Informal power creates encounters that have an effect on the sense of belonging among the employees. If the encounter is poor then it affects the morale of the employees.
Both the forms of powers have different impacts on the organization. Formal power is important for achieving strategic goals while informal power plays a vital role when the official leadership uses it for achieving organizational goals.
Personal Relationships at Workforce
It is very difficult for personal relations and business relationships to mix with each other. Many times any conflict between individual can spark huge suspicions about impartiality or favoritism. Many companies institute conflict in interest policies or hiring relatives and friends (ISM Diaries 2012). These policies specify clearly the points that are acceptable and not acceptable. But just specifying the pints does not do the job it is equally important to follow them. Some companies tend to be lax on these policies and don’t give importance to small issues that may hinder relationships. It becomes important for some senior level manager to stop these personal conflicts and improve the decision making process.
Sometimes even more problems can arise and relationships that are from outside the company run into trouble. Due to this companies need to void the vendors who might be having interpersonal relationship with some other decision maker in the company. Due to rise in relationship problems companies don’t hire relatives of officer, employee or even the director (ISM Diaries 2012). There are policies that create differences and at the same time affect the productivity of the employees. Politics and partiality by the top level management have been some of the biggest contributors in the differences between individuals.
Though we have been discussing about the effect of powers on relationship but there have been instances when good balance between personal and professional relationship have helped the company as well as the individuals. Good relationships increase positive thinking, makes people responsible, and increase flexibility of the employees. Shameful treatment of the employees should not be encouraged as it will demotivate them create a poor environment in the organization. The top level management finds it difficult to develop a motivating and helpful environment for the employees. Bad relations will force employees to leave the firm and affects the personal relations along with the professional ones.
All the personal relations should be kept at a distance when it comes to professionalism and everyone in the company should try to avoid differences. Formal powers and informal powers should be allowed to prevail but it is on the top management to stop disputes between individuals.
How does Formal and Informal Power affect Personal Relationship at Workforce?
The existence of relationships between employees and other staff in the organization is known to everyone. It is very important to understand the power structures inside the organization to adapt with the change and effectively achieve goals. The group dynamics and loyalty in the groups increase the political postures and influence cooperation of the employees. Formal powers are known to be better than informal ones. Formal powers follow a specific chart whereas in the informal system the power rests with the one who has the ability to influence people. Formal power provides authority whereas informal power helps in gaining respect.
Formal power affects relationship if an employee gets more powers as compared to his peers. The informal ones have negative effect due to the existence specific groups and lack of proper organizational chart. Politics and partiality in an organization has been playing a big part in affecting personal relationships (boston.com 2011). People focus on winning the competition and gaining authority using formal powers. They tend to forget the existence of informal powers that exist within an organization. These powers tend to create problems because though the people with formal power have authority the people having informal powers gain respect. It is better to avoid informal powers that don’t have negative effect on the company and its leadership.
Informal powers provide resistance to change and get into conflict with the management. This is common in organizations and the quest of informal organization always leads them away from the goals made by formal organizations. Informal powers are known for their roles of creating conflicts as rumors are common in them. Employee relationships as well as family relationships and friendship are affected due to these powers. The existence of fairness and propriety upsets co-workers. In family business the founder is found to be in a dilemma while searching for a successor. He is not able to appoint the successor as it appears as partiality to one. While being partial one tends to pick a person who not good enough and avoids the people who are better qualified. Informal and formal powers make the founders weak and stop them from being aggressive (Progressive Dairyman 2011). Due to conflicts and problems in personal relationships one is not able to be creative and take proper initiatives. This happens between most of the peers and personal relationships get affected while the one gets more appreciation for the same job. Motivation has always played an important part along with money.
Conclusion
Informal and Formal powers are known to be beneficial but they also tend to be detrimental depending on the way they are used. It is important to utilize the formal powers effectively and keep evaluating this structure with time. The top management should follow the informal structures closely and keep a track of the rumours doing the rounds. Companies often fail to analyse these powers effectively and this leads to relationship problems. If there is a strain in relations between the employees then this could lead to demotivation and affect the productivity of the company. As discussed above disagreements and differences lead to problems between individuals and affect the structure of the company as well. The environment among in the company is very important in both formal and informal powers. It is very important that the employees as well as the management keep the environment of the company in good condition and take the company towards one goal. One should make sure that the person who deserves his place gets that and one is given some authority by taking his abilities into concern. Arguments should not give place to differences. People might have different views but there should not be partiality towards a single person
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