Formal vs Informal SystemsMany, if not all organizations have formal and informal systems. Formal organization refers to components such as hierarchy, organizational charts, stated organizational purposes, on-paper descriptions of duties and responsibilities, etc. Informal organization refers to what, in fact people
actually do. For example, who really makes decisions versus who is supposed to, overlapping responsibility, socializing across departmental and status boundaries, and forming subgroups and cliques, etc
Climate vs Culture
It has been proven that an (large) organization’s internal culture and external environment/industry landscape accounts for 70% of the organization’s results. This makes it very hard for one person to make a significant change.
On the other hand, the other 30% is attributed to the climate. Climate refers to “what does it feel like for one person to work there”; “there” being defined as department, branch, project, product, unit, etc. Simply, a specific segment of a company. For example, Applebee’s has an organizational culture. Each individual restaurant will carry over a small amount of that culture, but mainly will display their individual climate. That is why some chain restaurants or stores may seem different to you than others within the same chain. The difference you feel/sense is the existing climate each store has.
Climate is impacted greatly by leadership styles or patterns by about 70-80%. Every leader changes or has an impact on the climate. Why is this true? If leadership styles are so important to the bottom line, why does marginal or poor leadership exist?
Examine the effective leaders in your life, what are their qualities and behaviors that separate them from the other people you are around? What can you learn from them? How do good leaders control the influence of culture on the climate they are creating?
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