Importance of groups in an organization are: 1. Filling in Gaps in Manager’s Abilities 2. Solving work problems 3. Better coordination 4. Channel of Communication 5. Restraint on Managers 6. Better relations 7. Norms of Behaviour 8. Developing Future Executives.

Informal groups are important not only from the point of view of their members; they have a great utility from organisation’s point of view also.


1. Filling in Gaps in Manager’s Abilities:

Informal organisation may act to fill in gaps in a manager’s abilities. For example, if a manager is weak in planning, one of his subordinates may help him informally in such a situation.

2. Solving work problems:

Informal organisation helps in solving the work problems of members. It allows sharing job knowledge and taking decisions which affect a number of jobs.

3. Better coordination:

Informal groups evolve short-cuts and eliminate red tapism. They facilitate smooth flow of information and quick decision-making. All these ensure better coordination among various individuals and departments.

4. Channel of Communication:


Informal groups act to fill up the communication gaps which might arise in the organisation. Informal communication cuts across the hierarchical and departmental boundaries and transmits information with greater speed.

Management can use informal channels to share information with the workers and get their reaction to management’s proposals. Informal communication can be of great use to organisation, if it is handled by the management properly.

5. Restraint on Managers:

Informal groups do not allow the managers to cross their limits. They restrict them from getting unlimited power and from using their power injudiciously.

6. Better relations:

A manager can build better relations with his subordinates through informal contacts. He can consult the informal leaders and seek their cooperation in getting the things done from the workers.

7. Norms of Behaviour:


Informal groups develop certain norms of behaviour which differentiate between good and bad conduct and between legitimate and illegitimate activities. These bring discipline and order among the employees of the organisation.

8. Developing Future Executives:

Informal groups recognise talented workers as their leaders. Such leaders can be picked by the management to fill vacancies at the junior executive level in the future.