When people interact beyond their officially defined roles and form a network of social relationship, then this type of concept is called as.....

Informal Organisation

The correct answer is option (2)- Informal Organisation.

When people interact beyond their officially defined roles and form a network of social relationship, then this type of concept is called as Informal Organisation.

Interaction among people at work gives rise to a ‘network of social relationships among employees’ called the informal organisation. Informal organisation has no set of behaviour as there is no rigid rules and regulations. An informal organisation originates from within the formal organisation as a result of personal interaction among employees. It emerges spontaneously and is not deliberately created by the management.

OTHER OPTIONS

* Formal organisation refers to the organisation structure which is designed by the management to accomplish a particular task. It specifies clearly the boundaries of authority and responsibility and there is a systematic coordination among the various activities to achieve organisational goals.  It is deliberately designed by the top management to facilitate the smooth functioning of the organisation. In formal organisation managers are leaders whereas in informal organisation Leaders may or may not be managers. They are chosen by the group.

* Delegation -  Delegation refers to the downward transfer of authority from a superior to a subordinate. It is a pre-requisite to the efficient functioning of an organisation because it enables a manager to use his time on high priority activities. It also satisfies the subordinate’s need for recognition and provides them with opportunities to develop and exercise initiative. Delegation is a compulsory act because no individual can perform all tasks on his own. It is a process followed to share tasks.

* Decentralisation - Decentralisation diminishes the amount of direct supervision exercised by a superior over the activities of a subordinate because they are given the freedom to act and decide albeit within the limits set by the superior. Also, personal supervision is generally replaced by other forms of control such as return on investment etc. Decentralisation also leaves the top management with more time which they can devote to important policy decisions rather than occupying their time with both policy as well as operational decisions. Infact, decentralisation is greatest when checking required on decisions taken by lower levels of management is least.