informal and formal system

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Management Information Systems 2010/2011

Lecture … (5)

Sources of Information








communication. Formal communications can include reports and accounting statements. Informal communications can include conversations and notes.

Formal Communication
Information transmitted by formal communication tends to be presented in a consistent manner. Company reports, for example, will often use the same basic format. This allows the recipient to locate items of interest quickly and easily. Since formal communications tend to be presented in a more structured manner, they are also more likely to present a more comprehensive view of the situations or circumstances they describe. In addition, the information transmitted in this way is likely to be accurate and relevant, since it is normally created for a specific purpose.

However, formal communication also has several disadvantages. The structure imposed on information is often inflexible, sometimes limiting its type, form and content. In addition, formal communications often overlook information obtained by informal means. This can affect the decision-making process, reducing the quality and accuracy of any decisions made. Finally, formal communications often ignore group and social mechanisms. A formal report, for example, might marginalize or ignore staff opinions, causing offence and leading to reduced morale.

Informal Communication
Informal communication is always present in an organization, regardless of its size or nature. Information of this kind can be considered a valuable resource 45

Management Information Systems 2010/2011

Lecture … (5)

and one of the aims of knowledge management is to harness it to work for the benefit of the organization. Perhaps the most common means by which informal communication takes place is by word of mouth.

Informal communication tends to offer a high degree of flexibility since there is more freedom to choose how information is structured and presented. Information obtained in this way also tends to be highly detailed, although it may often contain inaccuracies and may not be entirely relevant. The scope of information obtained in this way is often very narrow, relevant only to localized problems and situations. However, even at a local level, this can improve problem solving and decision making since it allows managers to gain a more detailed and in-depth understanding of a given situation.

One of the major disadvantages of informal communication is that it cannot deal with large volumes of information. Furthermore, as a means of communication, it is relatively slow and inefficient. Informal communication can also be highly selective, for example a person taking part in a conversation may be able to restrict what information is transmitted and who is able to receive it.

Formal and Informal Information Systems
Recently, a lot of interest is being in formal, organizational computer-based information systems. Formal systems rest on accepted and fixed definitions of data and procedures for collecting, storing, processing, disseminating, and using these data. The formal systems are structured; that is, they operate in conformity with predefined rules that are relatively fixed and not easily changed.


Management Information Systems 2010/2011

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Informal information systems rely, by contrast, on unstated rules of behavior. There is no agreement on what is information or on how it will be stored and processed.
Formal information systems can be either computer based or manual. Manual systems use paper-and-pencil technology. These manual systems serve important needs, but they too are not the subject of this text. Computer-based information systems (CBIS), in contrast, rely on computer hardware and software technology to process and disseminate information. From this point on, when we use the term information systems, we are...