Meaning of Formal organization | features, types, and Reason

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In this session, we will be discussing the meaning of formal organization, and features of Formal organization, advantages of Formal organization, disadvantages of Formal organization, types of Formal organization.

Meaning of formal organization

Formal organization is that type of organization where it is defined by organization structure. In a formal organization structure, there is clearly defined the whole rules, and regulations, authority, and responsibility of the members of the organization, and that also define delegation of authority and relationships amongst the organizational members.

In other words, In any business organization, there is a formal structure then there is no chance of misunderstanding anything. That’s because informal organizations completely design how to achieve specific organizational goals. And it relies heavily on the higher level of authority and division of labor to ensure that the work is accomplished effectually. (meaning of formal organization).

According to Chester Barnard, “organization is formal when the activities are coordinated towards a common objective.”

In the session, on the meaning of formal organization, we will also discuss the features of formal organization.

The features of formal organization can be dedicated by the following points.
  • Deliberately created structure
  • Division of work
  • Job Oriented
  • Departmentation
  • Formal authority
  • Delegation
  • Coordination
  • Principles of organizing
Meaning of Formal organization | features, types, and Reason

Deliberately created structure

Formal organization can define the relationships between the organizational members at working different departments and job positions that’s because it is a deliberately created structure. (meaning of formal organization)

Division of work

The chief basis of formal organization is the division of work. The whole tasks of an organization can be divided into small components and assigned to individuals on the basis of the organizational employee’s skills and abilities. Increase organizational output by the division of work amongst people results in specialization.

Job Oriented

Job-oriented focuses more on jobs than people. It allocates jobs to people and defines the structures of relationships amongst them for achieving the formal organization objectives.


As a whole business organization, the department is the foundation of organizational structure. that’s because the whole business organization structure depends upon departmentation. The whole tasks of an organization can be divided into small components and their re-grouping into bigger units (departments) is call departmentation. The functional departmentation divides organization structure into marketing, finance, production, and personnel departments. So that by the departmentation easily fixing responsibility of various departmental heads.

Formal authority

In the business organization by position people exercise authority by virtue of their hierarchy. So in any kind of organization authority is the link to the position and through it, in the person occupying the position. Authority involves the organization to the right to command to perform, to make decisions, and spend resources. (meaning of formal organization)


The whole tasks of the organization can’t be performe by one person. So the tasks are officially delegate from top to lower levels. The whole task loads can be divided into different components and assigned to the whole organizational employees with the authority to accomplish the tasks. And the delegation means by the concepts of division of works and its assignment to people down the scalar chain.

In any kind of organization delegation is the process by which authority to his subordinates who accept responsibility for those jobs accomplish within the time. So it is clearly define delegation is the process the managers use in distributing work to the subordinates.


In the business organization, the managers integrate the organization activities of individuals and group of people into concerted efforts, that’s why the organizational departments and individuals tasks towards a common goal. The organizational managers coordinate the organizational tasks by communicating organizational goals to the whole organizational department. Setting departmental goals and linking the performance of the whole organizational department with others. So that each department of the organization collectively contributes to the organizational goals. In the business organization coordination is the process of linking the tasks of the whole departments of the organization. (meaning of formal organization)

Principles of organizing

Formal organization is based on formal principles of organizing. that is unity of command, unity of objectives, balance, organizational efficiency, flexibility, division of labor, continuity, authority and responsibility, exception, delegation, simplicity, scalar chain, departmentation, the span of control, decentralization, unity of direction, and co-operation.

In the session on the meaning of formal organization, we will also discuss the advantages of formal organization.

The advantages of formal organization can be dedicated by the following points
  • Easy to fix accountability
  • No overlapping of work
  • unity of command of possible
  • Easy to achieve goals
  • Stability in organization
Meaning of Formal organization | features, types, and Reason

Easy to fix accountability:- In a formal organization clearly defines the authority and the responsibility of each and every organizational employee. Inefficient the whole organizational employees can easily be apprehende and in this way to their accountability can be fixed. (meaning of formal organization)

No overlapping of work:- There is no chance of misunderstanding anything in the organization. Because in a formal organization the organizational activities are systematically divide among various the organizational department and employees.

Unity of command possible:- The relationship between supervisor and subordinates can be clearly defined informal organization structure. So that in a formal organization the subordinates already know who reports to whom.

Easy to achieve goals:– In a formal organization structure easy to achieve the goals of the organization because there is optimum use of all the material and hum resources.

Stability in an organization:- In a formal organization structure all the organizational employees work by observing rules and remain confined within the domain of their authority. This leads to the establishment of good relationships which in turn, leads to stability in the organization. (meaning of formal organization).

In the session on the meaning of formal organization, we will also discuss the disadvantages of formal organization.

The disadvantages of formal organization can be dedicated by the following points
  • Delay in action
  • Ignores social needs of employees
  • Emphasis on work only
Meaning of Formal organization | features, types, and Reason

Delay in action:- In a formal organization to take action may get delay while following the chain of command and scalar chain.

Ignores social needs of employees:- In a formal organization psychological and social needs of employees are not given importance. Which may lead to demotivation of employees.

Emphasis on work only:- In a formal organization, there is ignored human relations, talents, and creativity so basically one thing focused on in the formal organization is work. (meaning of formal organization).

In the session on the meaning of formal organization, we will also discuss the types of formal organization.

The types of formal organization can be dedicated by the following points
  • Coercive organization
  • Utilitarian organization
  • Normative organization
Meaning of Formal organization | features, types, and Reason

Coercive organization

The coercive organization is a type of organization that uses forces to create a strict environment of rules and regulations. Once you enter this type of organization then there is no allowed to leave unless under special circumstances. The memberships of this type of organization are compelle of a higher authority and members must have permission from that authority to leave. It is definitely correct once if you will be entering that type of organization then you will be following their rules. Because their rules are so strict.

And individuals usually go through the process of resocialization being strippe of their former status as individuals and given a new identity. And the best example of this type of organization is Stanford prison. But other organizations fit this definition too, includes psychiatric facilities, military facilities for youths. These types of organization are similar to the concept of a total institution as formulated by Erving Goffman and Further developed by Michel Foucault. So I think or it is correct, you will find that life is very routine, and rules are very important in that type of organization. (meaning of formal organization)

Utilitarian organization

The utilitarian organization is that type of organization once if we will be entere that type of organization then we will be achieve something there. In simple words in that type of organization join with a specific goal in mind. Most peoples join these types of organizations with a remunerative goal in mind these points out of sociologists.

In another way, people are seeking to make money or to invest in their future. Business, College, Corporations, and/or universities these all are the best example of utilitarian organization. In the case of employment, a person earns a wage forgiven for their time and labor to the company. Also in the case of a school, a student develops knowledge and skills and earns a degree in exchange for respecting the rules and authority, and/or paying tuition. So in this type of organization, a large percentage of Americans spend a great deal of time.

Normative organization

And the last one is normative organization. The normative organization is a type of organization where order and control are maintained through a shared set of commitment and morals too. Voluntary membership refers to them. Though for some membership comes from a sense of duty. These types of organizations include churches, groups, or political parties, and social groups, like sororities and fraternities among others. Within these members are unified around a cause that is important to the normative organization. They are socially reward for their participation by the experience of a positive collective identity, and a sense of belonging and of purpose. (meaning of formal organization).

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