Informal organizations lack structure, designated roles and formal rules but thrive when membership conveys desired advantages. In that case, organizational elements include a mission and informally enforced compliance by limiting participation in the group to members who contribute and who are constructive. Other elements are leadership based on perceived success and enforcement of informal rules through organic group interactions. The group must achieve its goals and bring advantages for its members with such informal processes to survive.
A key element of an informal organization is its mission. There must be a reason for the informal organization to exist and for people to want to take part in its work. A lack of formal documentation limits the complexity. Typical informal organizations will have simple missions with clear goals. Members know what their responsibilities will be and what benefits are available to members. A mission must incorporate mutual goals that are difficult to achieve individually without cooperation. An informal organization can coalesce around such goals and function without formal structures.
Membership is the key informal organization element for promoting cohesion. The organization limits membership to its target group. Women's health groups may not admit men and internal corporate groups will not admit nonemployees. Within the target group, membership is generally open but may be limited in numbers, with excess candidates encouraged to start their own groups. Among members, the main informal requirements will be that they contribute and avoid being disruptive.
In the absence of formally designated leaders, informal organizations rely on the demonstrated competence of their members with regard to particular areas of activity. A member may have technical skills and will lead when the group must perform technical work. Another member may have good communication skills and take over that function. Group members keep track of demonstrated competency based on the success of particular initiatives. Each member will regard each other member as competent in a particular area based on current success and past reputation.
Enforcement is a key element for the survival of informal organizations. In the absence of formal rules and written sanctions for unacceptable behavior, members rely on social sanctions and group disapproval to encourage member cohesion. When members fail to act constructively over a longer period of time, the group must take stronger action. Member decisions to limit or end a member's participation in the group replaces the enforcement mechanisms of groups with formal structures.
- Washington University in St. Louis; Informal and Formal Organization in New Institutional Economics; Todd R. Zenger, et al.; October 2001
- University of Connecticut; Translating Participation in Informal Organizations Into Empowerment: Women in Rural India; Mangala Subramaniam; January 2001
- Yale; Sustainability and Organizational Design in Informal Groups, With Some Evidence From Kenyan Roscas; Siwan Anderson, et al.
- University of Nevada, Reno: 'Modern' Structural Theory