A group is two or more individuals, interacting and interdependent, who come together to achieve objectives. A formal group is defined by the organization’s structure, with designated work assignments and established tasks. In formal groups, behaviors that team members should engage in are stipulated by and directed toward organizational goals. In contrast, an informal group is neither formally structured nor organizationally determined. Informal groups in the work environment meet the need for social contact.

People often feel strongly about their groups, partly because shared experiences amplify our perception of events. Our tendency to personally invest in the accomplishments of a group is the territory of social identity theory. Our social identities help us understand who we are and where we fit in with other people. Ingroup favoritism occurs when we see members of our group as better than other people, and people not in our group as all the same. Whenever there is an ingroup, there is by necessity an outgroup. Ingroups and outgroups pave the way for social identity threat, which is similar to stereotype threat.