Plugging informality into organisational system

Highlights

• Organisations balance formal processes with informal relationships.
• Informal systems drive agility but can lead to favoritism and exclusion.
• Leaders must channel informality to enhance trust and performance.

formal processes slow down.

Consider a familiar scene. You are standing in a long queue at the snack counter during the interval at PVR INOX. Children grow restless, people keep glancing at the screen time, and the line barely moves. An experienced staff member quickly signals to a colleague, opens a side counter for quick orders, and eases the rush within minutes.

No committee cleared the move. No memo instructed it. One employee used experience and coordination to solve an immediate problem.

Now consider an airline check-in desk. A family arrives late after traffic delays. The baggage cut-off time has passed. By rule, the answer should be no. Yet a seasoned staff member assesses the situation, speaks to the back-end team, gets the bags tagged, and helps the family board.

The employee did not break the system. The employee used judgment within it.

Here lies the key difference. Formal systems create consistency. Informal actions create flexibility. Informality exists in every organisation for this reason. It appears when reality moves faster than process. It grows when systems become slow, rigid, fragmented, or too far removed from customer needs.

In other words, when approvals take too long, someone makes a call. When technology fails, people contact the person who knows the workaround. When departments work separately, trusted individuals connect them. When communication slows, informal networks carry information faster. This way informality helps daily operations run smoothly. So on and so forth…

Yet what solves problems can also create new ones. Helpful informality can turn into favouritism, secrecy, and exclusion. A quick workaround can become a regular bypass. A trusted network can become a closed group. Personal access can begin to matter more than performance. This is when things start tumbling down.

At the cinema, if an additional queue opens for families with children or elderly customers, most people will see it as fair. If the same opens only for those who know the manager, people will notice that immediately. At the airline desk, if judgment helps passengers facing genuine difficulty, trust rises. Whereas if exceptions depend on status or influence, trust falls.

Similar dynamic plays out inside organisations as well. When promotions appear linked to access rather than merit, morale declines. When the same people keep getting visible assignments, others begin to disengage. When decisions are made before meetings start, employees lose faith in participation. When people believe that knowing the right person matters more than doing the right work, culture weakens. Leaders therefore need to understand one simple point. Informality by itself is neither good nor bad. Its impact depends on how people use it.

This issue has particular relevance in India. We value relationships, trust, personal warmth, and a willingness to help. These qualities often create loyalty and speed.

Employees regularly go beyond formal roles to support colleagues and customers. But this strength can also create dependence on individuals instead of systems.

Many employees hear phrases such as, “Speak to him personally, then it will move,” or “Send it through her, she knows everyone,” or “Rules are there, but let us see who is asking.” Such phrases suggest that the informal system has gained too much power. Younger employees increasingly ask direct questions. Is growth fair? Are opportunities transparent? Can performance speak for itself? Do I need access to power to move ahead? These are healthy questions because they push organisations to improve.

The wrong response is to attack informality itself. No organisation can run on process alone. People need trust, judgment, flexibility, and common sense. A workplace with zero informality would soon become bureaucratic and slow.

The right response is to plug informality into the organisational system so that it supports performance without damaging fairness. This calls for leadership maturity and the understanding that systems need both discipline and adaptability. Leaders can begin by recognising where real influence sits, as titles do not always reveal it.

In every organisation, there are people who connect teams, calm tensions, solve crises, guide new employees, and spread ideas quickly. They may not hold senior designations, yet they carry enormous social capital. Responsible leaders identify them and involve them in change efforts, onboarding, mentoring, and collaboration. Ignoring these people means ignoring the real operating network of the institution.

Leaders should also pay attention to repeated workarounds. When employees keep bypassing a process, the process itself may be the problem. Where routine approvals need too many layers, simplify them. If one department keeps blocking progress, clarify authority levels. If a portal fails repeatedly, improve the technology. Informal fixes often expose weaknesses in formal systems. Many organisations punish the workaround while leaving the broken process untouched. That misses the real issue. A workaround may break procedure, but it often points to what needs repair.

At the same time, leaders should notice informal practices that solve real problems. Many useful operating ideas do not begin in boardrooms or policy committees. They emerge where pressure is high, and time is short.

Take the earlier example of PVR INOX during interval time. Demand rises sharply within a few minutes, and customers want speed, not explanations. An experienced supervisor may split the queue into prepaid orders, combo orders, and quick single item orders. Another staff member may move bottled drinks separately to reduce billing delays.

None of this may appear in a manual, yet it shows practical operating sense. When such methods work consistently, management should capture them, train others, and make them part of the service model.

Similarly, a branch manager who runs a five-minute morning huddle may reduce confusion for the entire day. A service team that creates a rapid-response internal group may close customer complaints in hours rather than days. A department that starts peer learning circles may build capability faster than formal training calendars.

These are not side activities. They are early versions of better systems.

Strong leaders know how to spot such patterns. They ask a simple question: Where are people quietly outperforming the process? The answer often shows where the next improvement should come from. That said, informality helps performance only when employees trust that outcomes remain fair. The moment people believe that access matters more than ability, the energy changes.

Take the airline example. If a late passenger with an elderly parent receives help because staff used humane judgment, most observers understand it. If another passenger gets the same help because he knows someone inside, the queue notices immediately. Trust can fall in seconds.

Inside organisations, employees read signals just as quickly. They notice who gets stretch assignments, who receives visibility, whose errors get overlooked, whose requests move quickly, whose files stay buried, and whose absence never carries consequences. Leaders often underestimate how closely people watch these patterns.

That is why promotions, rewards, transfers, project opportunities, nominations, and recognition need clear criteria and visible discipline. Employees can accept a difficult decision when they understand the basis. They struggle when decisions appear selective, vague, or pre-decided. Fairness is not a soft value. It is a performance driver.

Move Beyond the “Fixer Culture”

Leaders should guard against overdependence on a few “fixers.” Almost every institution has them. They know everyone, solve crises, get approvals unstuck, and rescue broken processes. They often become indispensable. Yet overreliance on such individuals signals system weakness. If the queue moves only when one supervisor arrives, the process is weak. If customer complaints close only when one senior employee intervenes, the workflow is weak. If files move only when one influential person calls, governance is weak. If one manager carries all institutional memory, continuity is weak. Heroic individuals can hide structural problems for years.

Strong institutions do something different. They convert personal capability into organisational capability. They document what the fixer knows. They redesign broken handoffs. They decentralise authority. They train more people to solve the same problem. They make excellence repeatable. The goal of leadership is not to celebrate dependence. It is to remove it.

Watch for Warning Signs

Leaders should watch for signals that informality has grown beyond healthy limits. Meetings become theatre because real decisions happen beforehand. New employees feel lost because nobody explains unwritten rules. Official channels exist, yet people prefer backdoor routes. Talented employees disengage quietly while average, but well-connected employees keep advancing.

People stop raising concerns because outcomes seem predetermined. Capable employees reduce effort because visibility appears political. Teams hoard information because influence matters more than collaboration. Research consistently shows that perceived unfairness reduces engagement, discretionary effort, and trust, while employees who view decisions as fair are significantly more committed and willing to contribute beyond formal roles. At that stage, the organisation may still appear smooth from outside. Targets may still get met. Reports may still look clean. But inside, belief begins to erode. Once belief erodes, performance eventually follows.

Why This Matters in a Digital Era

The best organisations maintain a disciplined balance. They preserve warmth without creating camps. They encourage relationships without gatekeeping. They allow discretion without arbitrariness. They move fast without sacrificing controls. They create humane systems rather than personality-driven systems. This balance matters even more in a digital era.

As organisations automate workflows, embed rules into software, and rely on dashboards, one risk grows silently- systems can become efficient but tone-deaf. A rigid algorithm cannot read urgency in a customer’s face. A portal cannot sense anxiety at an airline counter. A dashboard cannot detect the demoralisation of a capable employee who keeps getting overlooked. A chatbot cannot always understand context the way a seasoned employee can.

That is why human judgment remains essential. But it must be principled, not selective. Any organisation of the future will need both precision and empathy, both process and trust, both consistency and discretion, and both scale and human sense.

Inclusion and Informality

That discussion on the business school campus began with inclusivity and purpose, yet it returned to informality for a simple reason.

Inclusion needs more than policy statements or diversity reports. It needs real access. It is seen in whose calls get answered, whose ideas get heard, whose mistakes receive coaching instead of punishment, and whose path becomes easier without anyone openly saying why.

Many forms of exclusion hide inside informal systems. A woman employee may meet every performance metric yet remain outside old boys’ networks. A new entrant may have talent yet lack sponsors. A quieter performer may deliver consistently yet lose opportunities to louder networkers. A geographically distant team may remain invisible to headquarters.

Formal equality can coexist with informal exclusion. Leaders who care about inclusion must therefore examine not only rules, but routines.

Plugging informality into the organisational system goes far beyond efficiency. It requires attention on several fronts. As a leadership task, leaders shape norms, as a fairness task, trust depends on perceived justice, as a culture task, daily behaviours define institutions more than slogans do. Hence, strong organisations do not remove informality. They channel it, learn from it, and align it with purpose. They ensure that human warmth does not turn into favouritism, speed does not become a shortcut around process, relationships do not become gatekeeping, and discretion does not slip into bias.

When this balance is achieved, organisations combine the strength of systems with the strength of people. Trust deepens, culture strengthens, and performance endures.

Perhaps that is why conversations on a lush green campus often travel beyond theory, because the deepest lessons about institutions are usually lessons about people.

DISCLAIMER: The views expressed are solely of the author and does not necessarily subscribe to it. will not be responsible for any damage caused to any person or organisation directly or indirectly.