Formal and Informal Communication: Meaning, Networks & Differences

What Is Formal Communication 

The messages which are circulating on regulated, present channels, of an organization are creating the formal communication. The content of the communication is related to the organization’s activity, to the work and to anything which is related to those. The formal communication can consist in verbal messages, nonverbal messages, written, under the shape of letters, telephone messages, radio messages, and printed, internal notes. Even some gestures can consist in formal communication. The messages are transmitted by the authorized ones: on official channels, these arrive to the ones who need to react, to people or machines which need to know the content of these messages. Usually, all formal communications are recorded and kept in the organization’s evidence. Are retained copies of these by the transmitter, by the receiver, by all of the desks from the organization which need to know and keep the information? Examples of formal communications are given by work commands, reports and financial evidence, reports over sells / inventory, statements referring to the company’s policies, post descriptions, etc. The formal communication can sometimes take place on the horizontal, along the parallel directions of authority. The formal communication network from an organization along with the keeping spaces of these communications, are serving to more purposes. It defines the channel on which will be sent important messages. It will be created a transmitting plan of this information, both for the transmitter and for the receivers. It will be indicated the direction towards the persons who will react and to the persons who need to be informed about these actions, their steps and result. It offers an information storage space which will be necessary on planning the operations and control. It is created an ordered system for the superiors and subordinates, in order to keep each other informed constantly.

The formal communication network is formed out of formal channels, created by setting a formal system of responsibilities according to the hierarchical structure of the organization. The perfect network is the one which contains communication channel from bottom up, downwards and horizontally. Often the direction of horizontal communication is missing or it is inefficient and in this way the accuracy of the information decreases. The situation is appearing because of the lack of permanent circulation of the information between departments, although this is vital for the organization in conditions of existent competition, or the lack of specialists in organizational communication. The downwards communications, from top to bottom, is performed by the manager to the subordinates. There are transmitted provisions and instructions, are identified the employees’ responsibilities. In an efficient organization, this type of communication has its purpose in motivating the employees, their continuous information about policy, goals and organization strategy. The periodicity is important because it ensures the constant communication. Sometimes this type of communication is gaining a preferred tempt, moving only towards the employees, considered as having priority responsibilities. It can have place even when only the manager is transmitting orders and instructions to the employees, without being too preoccupied about their information. If the organization is in changing, the downwards communication must be used to change opinions, attitudes, to waste restrictions and fear towards misinformation in order to support the employees to comply with these changes. This type of communication requires feedback. That is why it is completed with bottom-up communication, from the employees to the manager. These, as they understand the downwards communication, can communicate their answers. The manager must pay attention to the information he receives, thanks to the employee’s tendency to say only good stuff to the boss: it may appear the deliberate misinformation.

The advantages of formal communication are:

1. They help in the fixation of responsibility and
2. Maintaining of the authority relationship in an organization.

The disadvantages of formal communication are:

1. Generally, time consuming, cumbersome and
2. Leads to a good deal of distortion at times.

Formal Communications Networks

The blue print of how communication flows within any organization. What would happen if this didn’t exist?

• Carries task-oriented messages (specific job instructions; performance reviews)
• Carries maintenance-oriented messages (more generally-based policies and procedures on how to accomplish tasks)
• Carries human messages (keys on employee needs like new health care benefits; vacation schedules; etc.)

1. Network Structures -- decentralized networks tend to be more efficient when involved in complex tasks; centralized ones often create higher worker dissatisfaction (feeling only marginally involved in the communication process)
• The Circle network -- no single employee is key to the communication; decentralized; morale often high in such networks; better employee access to each other; fewer organizational roadblocks.
• The Chain network -- step-by-step transmission of a message until it reaches its final designation.
• The Y network -- short branches off the main trunk; still focuses on a centralized structure through one employee. 
• The Wheel network -- centralized flow outward from supervisor to small number of employees.
2. Network Roles -- parts we perform within organizations.
• Liaisons -- employees who connect two groups without belonging to either one of them. Often an influential, experienced person.
• Bridges -- employees who belong to at least two groups and connect each group to clique to the other. Distortion may occur.
• Gatekeepers -- employees who control the information flow. Secretaries are often key gatekeepers; may be others who have power to give or withhold information.
• Isolates -- employees who have minimal contact with others; either by choice or because others try to avoid them.
• Boundary Spanners -- sometimes called “cosmopolites”; those who connect the organization to its relevant environment. Common roles are sales and customer service reps, public relations workers, etc.
3. Network Descriptors -- patterns of behavior that help reveal how communication flows within the organization networks.
• Dominance -- how equal employees are to one another. High versus Low dominance. High dominance requires communication be directed to a single or few key members who then disseminate information to others. Low dominance suggests that employees are roughly equal to one another.
• Centrality -- centralized networks (wheel, Y, chain) require this; is there a key employee through whom communication flows...or not?
• Flexibility -- how strictly organizations follow rules for communicating with others. High flex--allow variations; low flex would be very strict on how to communicate.
• Reach ability -- (don’t try to look this up in your dictionaries at home!) How many people must the message pass through before reaching its final destination?  Low reach ability has fewer intermediaries; high reach ability has potential for greater distortion since many people in the process. By the way, don’t try to find the word “reach ability” in your dictionaries---another of those made-up words that academics like to use!
• Strength -- frequency and duration of communication are the keys. Strong network would be frequent and thorough communication with employees; weak network would be rare and brief communication.
• Reciprocity -- the degree to which employees and bosses agree on the nature of their relationship. High reciprocity would exist when both see their relationship essentially the same; low reciprocity would exist when one perceives the relationship quite differently than the other.
• Symmetry -- the degree of sharing information between bosses and workers. When communication flows upward and downward you have a symmetrical relationship; just downward would be asymmetrical.
• Openness -- how open or connected the organization is to the outside environment. Some businesses are very dependent to the outside environment; others less so.

What Is Informal Communication?

Informal communication arises out of all those channels that fall outside the formal channels and it is also known as grapevine. It is established around the societal affiliation of members of the organization. Informal communication does not follow authority lines as in the case of formal communication. Informal communication takes place due to the individual needs of the members of an organization and subsists in every organization. Normally, such communication is oral and may be expressed even by simple glance, sign or silence. Informal communication, is implicit, spontaneous multidimensional and diverse. It often works in group of people, i.e. when one person has some information of interest; he passes it on to his informal group and so on. An organization can make efficient use of informal channels to fortify the formal channels of communication. It acts as a valuable purpose in expressing certain information that cannot be channelled via the official channels. It satisfies the people desires to identify what is happening in the organization and offers an opportunity to express dreads, worries and complaints. Informal communication also facilitates to ameliorate managerial decisions as more people are involved in the process of decision-making. In spite on many advantages, informal communication has certain disadvantages. Informal communication contains facts, deceptions, rumours and unclear data. The informal channels of communication may transmit completely imprecise information that may harm rather than help an organization. In addition, it is impossible to fix the responsibility for its origin or flow of information. However, for the efficient working of any organization both formal and informal communications are required.

Informal Communications Networks 

 “The Grapevine” “People” networks; unpredictable in how they operate; the communication is often spontaneous and situation ally derived; employees may choose to use these or not. Whether we do or not is often dependent upon

• Our proximity to the sender; and
• Whether we think the person is reliable and knowledgeable (do we trust them?).

Management may use the grapevine (even though we tend to think of it as being an “employees’ network”) to tap into employee sentiment; to send up “trail balloons” and then either distance themselves or embrace the ideas depending upon employee reactions. Gerald Goldhaber’s research findings on “grapevine” communication:

• It is fast.... very fast!!
• It is generally accurate...though varies from company to company.
• It is an indicator of employee attitudes or sentiment
• It usually travels by clusters (more later)

1. Grapevine participants -- No real gender differences regarding who uses it more often. Secretaries are often key players in the grapevine--being bridges between workers and management. Managers may use the grapevine for “trial balloon” messages as mentioned earlier.
2. Effects of grapevine activity on the organization -- if formal networks don’t provide employees with information; the grapevine will step in and rumours persist. Morale can be affected adversely.
3. Factors involved in rumour dispersion -- why do rumours exist? What keeps them alive? Such reasons are
• The importance of the message;
• The ambiguity of the message;
• The need for information in crisis times;
• Credibility of the person sending the rumour;
• Who is the focus of the rumour; and
• The age of the rumour.
4. Factors that contribute the grapevine message distortion —
• Messages get condensed or shortened; stuff gets left out
• Certain information gets highlighted; other gets less attention; depends of the needs of the sender
• Messages may be added to; have gaps filled in as they move along
• Selective perceptive -- we may only “hear what we want to hear” and disregard the rest
5. Grapevine transmission patterns—
• Single-strand chain -- I tell you a rumour and then you pass it along to another person, who then tells another, and on-and-on.... (pretty rare)
• Gossip chain -- I tell the class a rumour and you pass it along to others
• Cluster transmission -- most common; I tell two or more employees and you repeat this transmission process to others.
6. Types of Organizational Rumours—
• Anxiety rumours -- reflect an uneasiness in employees (impending bad news on the horizon)
• Wish-fulfillment rumours -- good news may be on the horizon (as a group or for an individual)
• Wedge-driving rumours -- creates dissension; an “us vs. them” attitude in an organization.
• Social rumours -- juicy gossip about people; no direct company link.
7. Suggestions for how an organization can manage or control the grapevine -- Managers should or could -
• Be sensitive to employee reactions; respond to high anxiety cases.
• Be open, honest and quick to respond (when possible) with employees.
• Seek out key “gatekeepers” in employee ranks for information dissemination.
• Take a proactive stance; keep employees updates via bulletins, meetings, newsletters, etc.

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Sandeep Ghatuary

Finance & Accounting blogger simplifying complex topics.

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