Communication in Business

Communication is the process of exchanging information or ideas between two or more individuals or groups.

Internal communication: exchange of information that takes place within an organisation (e.g. at departmental meetings, in team briefing sessions and in memos to staff).

External communication: exchange of information that takes place with individuals, groups and organisations outside the business (e.g. via advertising material, telephone calls to suppliers and letters to customers).

Two-way communication ensures that any communication has been fully understood and is therefore more effective than one-way communication. Effective two-way communication is a vital element of democratic management, effective delegation, empowerment and teamwork.

Communication is transferring information from one part of the business to another that leads to some outcome, changed behaviour or changed practice.

• Formal Communication - Established and agreed procedures
• Informal Communication -Channels not formally recognised – ‘the grapevine’

Methods of Communication

• Verbal
• Face to Face
• Written
• Electronic
• Visual
• Audio
• Group meetings
• Notice boards
• Text

Motivation and Communication

• If employees are well motivated this can impact communication as they are more likely to speak to senior employees
• Poor levels of motivation are likely to have a negative impact on communication
• Communication and motivation are related – if one increases it is likely to have a positive impact on the other

Effective Communication

Effective communication has the following benefits:

• It makes change easier – this is particularly important to businesses who are in industries which are changing rapidly
• It increases commitment from employees
• It increases coordination
• It helps ensure that all employees are working towards the same objectives

Barriers to Successful Communication

• Ability of the sender – how much the sender understands of the message they are trying to send
• Content – including technicalities and jargon
• Method of communication – including style and body language where appropriate!
• Skills and attitude of the receiver
• Organisational factors – complexity of the organisation, scope of the organisation
• Cultural attitudes
• Perceptions, prejudices and stereotypes
• Inappropriate target for the message
• Technical capabilities – ICT

How to improve Communication

Communication can be improved by:

• Staff training in communication skills
• Keeping information to a minimum
• Increasing awareness of cultural and linguistic differences

Difficulties for larger organisations

As organisations grow they often experience problems with communication which can lead to diseconomies of scale

These may be caused by:

• Communication overload
• Too many levels in the hierarchy
• Decentralisation

Larger organisations need to manage communication to ensure it is effective. They can use ICT to speed up communication throughout the business. Clear messages need to be communicated down the chain of command.