Communication which takes place without following the formal lines of communication is said to be informal communication. This channel is not created through management and is commonly not under the control of management. An informal system of communication is commonly referred to as the'grapevine' because it spreads throughout the organisation along with its branches going out in all directions in utter disregard of the levels of authority and linking member of the organisation in any direction.
The informal communication generally works where there is communication gap among employees and the management. It has been observed which problems relating to work and unfavourable reactions to several organisational practices are transmitted by informal communication. Because the channels are flexible and establish contacts at personal levels between members of organisation at various hierarchical stages, the grapevine spreads information faster than the formal system of communication. About 10 to 40 percent of employees receive information (or misinformation) about the organisation by informal channels of communication.
The grapevine transmits information from one person to a group of persons more rapidly within a cluster chain arrangement. The cluster chain is made up of individuals who act as information sources. Every individual passes the information to various others, a few of whom repeat the message to others. Some of those who receive the message may not pass on the information to others but the information migiht lead to a change in their thinking on the subject and might sometimes affect their behaviour as well. Figure illustrates the cluster chain network of informal communication.