It has been observed above that a manager should also be a good leader. But in actual practice, every manager is not able to provide the kind of leadership desired by his subordinates. This gives rise to informal leaders who do not hold any managerial post in the organisation. A formal leader, on the other hand, is one who possesses organisational authority to direct and control the activities of his subordinates. He can issue orders and instructions to his subordinates by virtue of his formal authority in the organisation. An informal leader is elected by the management, as in case of a formal leader.
Sometimes, informal leaders become more acceptable to the workers as compared to the formal leaders. In such a situation, the formal leaders become the position-holders only. They are not able to achieve the voluntary cooperation of the workers in all matters. It is also true that a work-group may have different leaders for different purposes. The members of a work-group may be influenced by one leader while doing their jobs. But as regards their personal problems, they may go to another leader as far as their reaction is concerned.
Management often tries to suppress informal leaders. But it should be remembered that the trouble they cause reflects the desires of the group. If they are suppressed, the workers may become more antagonistic to management, morale may fall even lower and new informal leaders may step to the fore. Therefore, it is better to work with informal leaders. There are many ways in which a manager can build up good relations with the informal leaders working with him. Among other things, he can pall necessary information to them first, seek their advice on technical and human relations problems, and assign them to train other.