Planning And Organisation Of Business

A formal organisation refers to the official structure of relationships deliberately created by management to achieve organizational objectives.
It is a system of well-defined jobs, authority, responsibility, and accountability, where each employee knows his or her duties and position in the organisation.
Formal organisation is established through proper planning and is represented by an organisational chart that clearly shows lines of authority and communication.
In a formal organisation, rules, regulations, policies, and procedures are clearly laid down to guide the behaviour and actions of employees.
It ensures coordination, discipline, and systematic working by defining relationships among various departments and individuals.
Thus, a formal organisation provides a stable framework within which the activities of an enterprise are carried out efficiently.