The Nature of Business

Communication
-: Presented by :Chirag Barot

Learning Objectives : Map out the different stakeholder of an organization, or

the publics with whom a manager has to communicate.

Understand the primary reasons for communication with
each stakeholder.
Select the most effective channel for communication with
each stakeholder.
Describe how information flows within an organization.
List out the advantages and limitations of formal and
informal communication networks.

Type of Business
Communication
There are two type of business
communication :1. Internal Business Communication
2. External Business Communication

The Wheel of Business

Communication
bankers
media

Society

superiors

government

suppliers

peers

Management

subordinates

intermediaries

customers

Employee /
unions

shareholders

Internal Business
Communication
Superiors The higher ups in the organization to

whom you report.

Peers Co-workers, or people at the same level
within an organization.
Subordinates People in the organization who
work below you or report directly to you.
Employee/Unions They can be quite powerful,
therefore communication with them is essential.
Shareholders They are the owner of the
company.

Stakeholder

Channel

Overall Objective

Superiors

Written reports
Presentations
Meetings

Awareness of progress
Suggestions and feedback
Problem solving

Peers

Face to face meetings

Coordination,
Teamwork
Information sharing

Subordinates

Written comm.
Face to face meetings

Compliance with instruction and

policies
Review of work progress
Feedback

Employees/
Unions

Written communication

Employee satisfaction and welfare

Shareholders

Meetings
Advertisements
Brochures

Building trust and confidence

External Business
Communication
Consumers Organization need to communicate

with consumers to provide information about their

products and services, special promotional offers
and new product developments.
Intermediaries This refers to the trade
distributors, wholesalers, retailers, franchisees, etc.
Suppliers its refer to supplier of raw material,
components, power, water or other utilities.

 Government It is particularly important in the Indian

context and is a part of public relation. And reasons is that

tax matters, and legal aspects, seeking clearances for new
activities, foreign exchange, etc.
Society communicate with the community at large to
project themselves as responsible corporate citizens.
Supporting womens education, building hospital, school of
children, etc.
Bankers organization need to communicate with bankers,
both in good time and bad time because bankers are the
same are the same as those shareholders.
Media communication with media is to maintain good
relations. It will carry a positive story about the company.

Stakeholder

channel

Overall Objective

Consumers

Advertisements
Letters

Awareness
Information
Persuasion

Intermediaries

Written contracts
Newsletters
Advertisements
Review meetings

Awareness
Information
Motivation

Suppliers

Direct oral communication

Online communication

On-going relationship
Partnership

Government

Periodic meetings
Formals letters

Government cooperation

Society

Direct oral communication

Advertisements

Corporate social responsibility

Bankers

Periodic and special meetings

Written reports

Good rapport
More borrowing ability

Media

News conferences
News releases

Good relations

Communication Network in
Organization
A communication network refers to how information
flows within the organization.
According to ADLER, communication networks
are regular patterns of person to person
relationships through which information flows in
an organization.
Communication network may be :1. Formal communication network
2. Informal communication network

Formal Communication
Network
Which is created by management and described with
the help of an organizational chart.
The organizational chart implies that information can
flow in any of three direction :1. Upward Communication
2. Downward Communication
3. Horizontally Communication

Upward Communication - Information that

flows from subordinates to superiors.
2. Downward Communication Information that
flows from superiors to subordinates.
3. Horizontal Communication This type of
communication is also known as Lateral
communication. It may be defined as
communication that takes place between coworkers in the same department, or in different
departments, with different areas of
responsibility.
1.

Informal Communication
Network
It called grapevine.
In this type of network, information does not flow in
a particular direction, as we have seen with formal
network. The Information is also not passed on
through official channels such as memos, notices
or bulletin boards.
Example :- co-workers may meet outside the work environment at a
company picnic party or a car pool and discuss areas of common
interest that may or may not be work related. Information may then be
passed on to each other about happenings in the company, such as
layoffs, the companys plans for acquisitions and so on.

Multi-layer Organizational
Pyramid
General Manager

Manager

Asst Manager

manager

Asst Manager

Asst Manager

Asst Manager

executive

executive

executive

executive

executive

executive

executive

executive

Compressed Organizational
Pyramid

General Manager

Manager

Manager

Manager

Manager

Manager

Manager

All The Best

The End