A social institution is a complex, integrated set of social norms organized around the preservation of a basic societal value. Obviously, the sociologist does not define institutions in the same way as does the person on the street. Lay persons are likely to use the term "institution" very loosely, for churches, hospitals, jails, and many other things as institutions.
Sociologists often reserve the term "institution" to describe normative systems that operate in five basic areas of life, which may be designated as the primary institutions.
(1) In determining Kinship;
(2) in providing for the legitimate use of power;
(3) in regulating the distribution of goods and services;
(4) in transmitting knowledge from one generation to the next; and
(5) in regulating our relation to the supernatural.
In shorthand form, or as concepts, these five basic institutions are called the family, government, economy, education and religion.
The five primary institutions are found among all human groups. They are not always as highly elaborated or as distinct from one another as into the United States, but, in rudimentary form at last, they exist everywhere. Their universality indicates that they are deeply rooted in human nature and that they are essential in the development and maintenance of orders. Sociologists operating in terms of the functionalist model society have provided the clearest explanation of the functions served by social institutions. Apparently there are certain minimum tasks that must be performed in all human groups. Unless these tasks are performed adequately, the group will cease to exist. An analogy may help to make the point. We might hypothesize that cost accounting department is essential to the operation of a large corporation. A company might procure a superior product and distribute it then at the price which is assigned to it, the company will soon go out of business. Perhaps the only way to avoid this is to have a careful accounting of the cost of each step in the production and distribution process.