what is a formal organization workplace
Jupiterimages/BananaStock/Getty Images. The concepts of formal and informal organizations relate to the nature of relationships and processes in the workplace. A formal organization is the literal structure of the organization including its organization chart, hierarchical reporting relationships and work processes.n organizational chart effectively outlines the structure of the formal organization. It shows the hierarchy from the CEO and top management to mid-level management to front-line employees. It also shows the horizontal interrelationships of various functional divisions or departments.