Within any organization, there are usually formal structures and informal structures. Informal structures will often become more important if the formal structures stop working and the organization does not adjust them.
An organization’s formal structure can be seen in its organizational chart. Organizational charts show the official flow of work and authority in a company. They show who reports to whom. They show who has responsibility for certain areas of work. They show which people are supposed to work with which other people. These lines of responsibility and authority are very clear and easily understood.
An organization’s informal structure is not so easily charted. It springs up much more spontaneously. An informal structure may arise, for example, when people who are not connected in the formal structure become friends because they play golf together or have some other common interest. These people may then start to collaborate in the work setting in ways that are not shown on the organizational chart.
It consists of a dynamic set of personal relationships, social networks, communities of common interest, and emotional sources of motivation. (Sociology, Boundless.com)
The informal structure may be more productive than the formal structure. This is particularly likely to happen if the formal structure no longer conforms to the reality of how the organization works.