Organisational Structure: Some Observations on the Importance of Informal Advice and Trust Networks

Formal and informal organisational structures are inter-dependent entities that contribute to the firm’s working environment—an interdependence that reflects cross-employee relationships. The formal organisational structure is prescribed and understood, whilst informal networks are by definition difficult to identify. Indeed, the ability of workers in an organisation to share data, information and know-how can be enhanced through the existence of well-formed but undocumented informal networks. Informal networks are a potential conduit that allows workplace project initiatives to be streamlined, can inform and improve decision-making and provide support for individual-to-individual information or knowledge exchanges. This paper uses the theoretical literature to examine the notion of organisational structure and relates how informal networks are an important element in underpinning the firm’s cohesion and performance. The advice and trust networks are examined with some of the potential positive impacts of each informal entity on the firm being noted