Main Difference
The main difference between Institution and Organization is that the Institution is a structure or mechanism of social order and cooperation governing the behaviour of a set of individuals within a given community and Organization is a social entity with a collective goal; social units of people that are structured and managed to meet a need, or to pursue collective goals
Institution
Institutions are “stable, valued, recurring patterns of behavior”. As structures or mechanisms of social order, they govern the behaviour of a set of individuals within a given community. Institutions are identified with a social purpose, transcending individuals and intentions by mediating the rules that govern living behavior.
The term “institution” commonly applies to both informal institutions such as customs, or behavior patterns important to a society, and to particular formal institutions created by entities such as the government and public services. Primary or meta-institutions are institutions such as the family that are broad enough to encompass other institutions.
As structures and mechanisms of social order, institutions are a principal object of study in social sciences such as political science, anthropology, economics, and sociology (the latter described by Émile Durkheim as the “science of institutions, their genesis and their functioning”). Institutions are also a central concern for law, the formal mechanism for political rule-making and enforcement.
Organization
An organization or organisation is an entity comprising multiple people, such as an institution or an association, that has a collective goal and is linked to an external environment.
The word is derived from the Greek word organon, which means “organ”.
Institution (noun)
A custom or practice of a society or community.
“The institution of marriage is present in many cultures but its details vary widely across them.”
Institution (noun)
An organization similarly long established and respected, particularly one involved with education, public service, or charity work.
“The University of the South Pacific is the only internationally-accredited institution of higher education in Oceania.”
Institution (noun)
The building or buildings which house such an organization.
“He’s been in an institution since the crash.”
Institution (noun)
Other places or businesses similarly long established and respected.
“Over time, the local pub has become something of an institution.”
Institution (noun)
A person similarly long established in a place, position, or field.
“She’s not just any old scholar; she is an institution.”
Institution (noun)
That which institutes or instructs, particularly a textbook or system of elements or rules.
Organization (noun)
The quality of being organized.
“This painting shows little organization at first glance, but little by little the structure becomes clear.”
Organization (noun)
The way in which something is organized, such as a book or an article.
“The organization of the book is as follows.”
Organization (noun)
A group of people or other legal entities with an explicit purpose and written rules.
“In response to the crisis, the nations in the region formed an organization.”
“If you want to be part of this organization, you have to follow its rules.”
Organization (noun)
A group of people consciously cooperating.
“Over time, the spontaneous movement had become an organization.”
Organization (noun)
A major league club and all its farm teams.
“He’s been in the Dodgers’ organization since 2003.”