Formal and Informal Leadership, Explained

UPI Study › Courses › Foundations of Leadership › Free lessons › Lesson 6.6 Free with a free account

Formal and Informal Leadership

Foundations of Leadership · Chapter 6: Leadership Power, Styles & InfluenceSection 6.6 · lesson 32 of 9010 min · free with a free account

← Formal and Personal PowerNext lesson: Referent and Expert Power →

Earn 3 college credits for Foundations of LeadershipRecommended for credit by NCCRS · Business 205 · self-paced · one payment, lifetime access
Enroll in Foundations of Leadership · $250 →Download the syllabus (PDF)

In this lesson

Every organisation runs two structures at once - and when they disagree, the invisible one usually wins.

  • Distinguish formal from informal leadership by source of authority
  • Explain why informal leaders emerge even when leadership is assigned
  • Recognise the signature behaviours of an informal leader
  • Work with the informal structure rather than against it

Free study notes

Get this lesson's notes by email

The key points and 4 practice questions with answers, in your inbox. One email, free.

One email. Unsubscribe in one click.

Transcript

Everything said in the video, section by section (1,335 words). Read along, or search it.

Leadership Power, Styles & Influence

Formal and Informal Leadership

Every organisation has two structures, not one. The first is visible. It is the org chart, with its boxes, lines and reporting relationships. The second is invisible. It is the network of conversations, trust and credibility through which influence actually flows. Formal leadership operates on the first structure. Informal leadership operates on the second. Most of the time, the two align. Managers really do lead their teams. But when they diverge, the informal network typically wins. This section is about what to do when it does.

Two Structures

The Chart and the Lattice

Start with what each structure actually records. The formal structure is what an org chart describes. Who reports to whom. Who has the authority to make which decisions. Who is accountable for what. Formal leaders occupy named positions in that structure. Manager, director, vice-president, principal, captain. Their authority comes from the position, and disappears when the position changes. The informal structure of the same organisation is different in kind. It is the lattice of relationships through which influence actually moves. Who is consulted before decisions get made. Whose opinion shifts a meeting. And whose disapproval kills a proposal, regardless of who signed it. Informal leaders are the people at the centre of that lattice. Their power is the personal power from the previous section, expert and referent. And it does not appear on any chart.

The Point

Why the Org Chart Is Always Incomplete

It is worth being clear about why the chart cannot capture this. The org chart records who has authority. The informal structure records who has influence. Those are different things, and they were never meant to be the same. This is not a failure of the document. An org chart that captured every flow of influence would have so many lines, nobody could read it. The simplification is the whole point of the artefact. So the wise formal leader stops trying to make the chart describe everything. Instead they learn to read the informal structure as a separate document. Invisible, but essential. It tells them how decisions actually happen.

Emergence

Informal Leaders Are Not an Accident

Informal leaders are not accidents, and they are not a symptom of weak management. They emerge from a small set of predictable conditions. First, real work creates problems that the formal structure does not solve smoothly. Someone whose job description does not include the problem becomes the de facto go-to person. Second, expertise concentrates. In any sufficiently complex domain, one or two people accumulate enough specialised knowledge that colleagues route important decisions through them. Third, trust accumulates unequally. People with consistent good judgement, discretion and goodwill end up consulted more often. Fourth, identity-based affiliations create informal leaders within sub-groups. A long-tenured engineer becomes the unofficial steward of the team's engineering culture. None of these dynamics is pathological. They are how groups make sense of work in real time, faster than the formal structure can adapt.

The Sequence

How Informal Authority Accumulates

Trace the sequence and you can see why nobody has to appoint anyone. Real work throws up a problem that the chart does not cover. Someone steps in and handles it, and then handles the next one. Over time expertise concentrates around them, and decisions start getting routed their way. Trust accumulates in the same direction. Judgement, discretion, goodwill. And at the end of it there is a person who gets consulted first. With no line on the org chart to explain why. The role was assembled out of repeated consultation, not conferred by anyone. Which is also why it cannot simply be revoked.

Aligned

When the Two Structures Reinforce Each Other

Now the practical question. When does informal leadership help? It supports formal leadership whenever the two are aligned in purpose. Take a manager about to announce a change to her team. If she consults the team's informal leader first, the change tends to land more smoothly. The reason is not politeness. It is that the informal leader has effectively co-signed it inside the network. Notice what that conversation costs. Twenty minutes, perhaps. And notice what it buys. The difference between announcing a decision and actually having one adopted.

Misaligned

Visible Compliance, Invisible Drag

The misaligned case is more interesting, because of how it presents. When a team's informal leader has lost confidence in the formal manager, you do not see a fight. You see agreement. Visible compliance, and invisible drag. Meetings end without dissent. Execution stalls anyway. Side conversations multiply. High performers begin to leave. The signal that this is happening is rarely overt opposition. It is the quiet erosion of momentum, which is very easy to attribute to something else. A formal leader who reads that signal correctly usually finds an uncomfortable diagnosis. The remedy is not a stronger directive. It is an honest conversation with the informal leader they had been ignoring.

Recognise

How to Spot an Informal Leader

Informal leaders are recognisable, even though they carry no title. Their names are the ones that appear when colleagues are asked a simple question. Who would you go to for advice on a hard problem? They tend to be consulted before decisions of certain types. Technical, ethical, political. Even when those decisions formally belong to someone else. They take responsibility for outcomes well outside their formal remit. And they are notably willing to give credit away. They are often slightly more senior than their position would suggest, though this is not always so. A new joiner with a strong external reputation can acquire informal leadership in a matter of weeks. There is one diagnostic that does most of the work here. Ask every person on your team who they would consult first about a difficult problem. The names that come up repeatedly belong to your informal leaders. It is a cheap question, and most leaders never ask it.

Case

The Senior Nurse Who Ran the Ward

A surgical ward makes the gap between the two structures very visible. The formal hierarchy ran from the consultant surgeon, to the registrar, to the staff nurses. Asked who actually ran the ward, every single interviewee named the same person. The senior nurse, with twenty-eight years of experience. Including the consultant himself. She had no formal authority whatsoever over the registrars. And complete informal authority over the rhythm of the ward. Junior doctors checked decisions with her before acting. Senior doctors deferred to her judgement on patient flow, without ever naming the deference publicly. Then a new consultant arrived and tried to override her authority through formal directives. Ward performance dropped within a fortnight. He learned to work with her rather than around her, and the ward recovered.

In Practice

Partner With It, Do Not Neutralise It

So what does a thoughtful formal leader actually do? The temptation, especially for new leaders, is to see informal leadership as a rival authority to be neutralised. The better practice is to treat it as an asset to be partnered with. Three habits help. First, identify the informal leaders early, through honest observation rather than gossip. Pay attention to whose voice changes the room, and whose absence is missed. Second, build genuine working relationships with them. Including private channels where honest dissent is actually welcomed. Informal leaders who feel respected by formal leadership become powerful translators. They convert formal direction into the team's lived reality. Third, refuse to play informal leaders against the formal structure. Promote them when their work merits it. Give them visibility. And resist the bureaucratic instinct to treat their influence as a threat. Done well, the two structures reinforce one another. Done badly, they tear each other apart.

Case

Wangari Maathai and the Green Belt Movement

For how far informal leadership can travel, consider Wangari Maathai. She held no formal political office for most of her career. She began in nineteen seventy-seven, encouraging Kenyan women to plant trees on their farms. The aim was to combat soil erosion and improve household resilience. The Green Belt Movement grew through a network of local groups. Their authority was entirely informal. Based on demonstrated results, accumulated trust, and shared purpose. By the time she was awarded the Nobel Peace Prize in two thousand and four, she was among the most consequential leaders in East African civil society. Still without holding executive office in government. Her later appointment as Assistant Minister for Environment simply confirmed what was already true. Formal office sometimes follows informal leadership, rather than producing it.

About Foundations of Leadership at UPI Study

Foundations of Leadership (Business 205) is a self-paced online course of 90 video lessons in 12 chapters, from the roots of leadership theory and the trait, situational and transformational approaches to power, decision-making, communication, teams, conflict, diversity and global leadership. It carries a NCCRS credit recommendation for 3 semester credits.

Every lesson transcript is free on pages like this one, and the videos are free with a free UPI Study account. Enrolling adds a practice quiz after each lesson, the graded work and final exam that earn the credit, lifetime access, and an official transcript on completion. UPI Study has helped over 130,000 students with college credits. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.

Enroll now → Course details Download the syllabus All Business courses Every course with PRO →

Compare: Management and leadership courses · Foundations of Leadership vs Leadership and OB

Why take it here

Why students take Foundations of Leadership with UPI Study

What makes people follow a leaderFoundations of Leadership covers the main theories of leadership and how leaders use power, make decisions, communicate, build teams and handle conflict. It is a common course in business, management and organizational leadership degrees.
Credit at a fraction of the priceThe same 3 credits can cost $750 or more at a US college. Here it is one payment, self-paced, with lifetime access.
Finish your degree soonerTransfer credits reduce the courses you still owe, so you can graduate earlier or lighten a heavy semester.
Strengthen an applicationA completed college-level course on an official transcript shows admissions and scholarship committees you can do the work.
Study on your own scheduleNo start dates, no deadlines. Watch the lessons, practice, and take the final when you are ready.
130,000+students helped with college creditsACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.

Where the credit goes

Universities that work with NCCRS

Foundations of Leadership carries a NCCRS credit recommendation. These universities work with NCCRS; some are UPI Study's signed partners. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.

Thomas Edison State UniversityThomas Edison State UniversitySigned partnerUniversity of the PeopleUniversity of the PeopleSigned partnerCharter Oak State CollegeCharter Oak State CollegeSigned partnerStrayer UniversityStrayer UniversitySigned partnerColumbia Southern UniversityColumbia Southern UniversitySigned partnerIndiana TechIndiana TechSigned partnerPenn StatePenn StateWorks with NCCRSSouthern New Hampshire UniversitySouthern New Hampshire UniversityWorks with NCCRSSUNYSUNYWorks with NCCRS +many more cooperating universitiesFind my college →

Find my college → Not listed? Ask Athena in the corner of this page, or book a 15-minute call.

FAQ

Questions students ask us

About Formal and Informal Leadership

What is the difference between formal and informal leadership?
Formal leadership comes from a named position on the org chart, while informal leadership comes from influence that appears on no chart. Formal leaders, such as managers and directors, hold authority that disappears when the position changes. Informal leaders sit at the center of the network of trust and credibility through which influence actually flows, and their power is personal, built on expertise and admiration. When the two structures diverge, the informal network typically wins.
How do informal leaders emerge in organizations?
Informal leaders emerge when real work creates problems the formal structure does not solve and someone repeatedly steps in. Expertise then concentrates around a few people, trust accumulates toward those with good judgment and discretion, and sub-groups form identities with their own unofficial stewards. No one appoints them; the role is assembled from repeated consultation, which is also why it cannot simply be revoked. Wangari Maathai's Green Belt Movement, begun in 1977, grew on this kind of informal authority.
How can a manager identify the informal leaders on a team?
The simplest way is to ask each team member who they would consult first about a difficult problem; the names that come up repeatedly belong to the informal leaders. Informal leaders are also consulted before technical, ethical, or political decisions that formally belong to someone else. They take responsibility well outside their remit and readily give credit away. Watching whose voice changes a meeting, and whose absence is missed, adds further evidence.
How should a formal leader work with informal leaders?
A formal leader should treat informal leaders as partners rather than rivals to be neutralized. That means identifying them early, building genuine working relationships with private channels for honest dissent, and giving them visibility and promotion when their work merits it. Consulting the informal leader before announcing a change helps it land. When an informal leader has lost confidence, the warning sign is quiet compliance with stalled execution, and the remedy is an honest conversation.

About the Foundations of Leadership course

How many college credits is Foundations of Leadership?
Foundations of Leadership (Business 205) carries a NCCRS credit recommendation for 3 semester credits. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities.
How much does Foundations of Leadership cost and what is included?
$250, paid once, with lifetime access: all 90 video lessons, a practice quiz after each, the graded work and final exam, and an official transcript when you finish. Students who want several courses choose UPI Study PRO instead.
Which universities accept UPI Study credits?
UPI Study has signed partner agreements with universities such as Thomas Edison State University, University of the People and Charter Oak State College, and works with universities such as Penn State, SNHU and SUNY. ACE and NCCRS have over 2,100 cooperating colleges that will consider accepting credits; the final decision is with the universities. Use "Find my college" on this page to check yours.
How long does Foundations of Leadership take?
It is self-paced with no deadlines. The 90 lessons total about 16 hours of video; most students add reading and practice time and finish in a few weeks to a few months, on their own schedule.
How are the exams done?
Quizzes and assignments are online in the course. The final exam is taken online with proctoring; a person on the UPI Study team checks assignments, usually within two days.
How do my credits reach my college?
When the course shows 100% complete, request the official transcript from your dashboard. It is sent to the college you name, and you can send it to more than one. Check your college first with "Find my college" on this page, or ask Athena.

Ready for the full course? Earn 3 credits in Foundations of Leadership.

90 video lessons, a quiz after each one, and the graded work that earns the credit. Recommended for credit by NCCRS.

Enroll in Foundations of Leadership →Download the syllabusEvery course with PRO →
Foundations of Leadership
3 credits · NCCRSEnroll →