AJAY KUMAR GARG INSTITUTE OF MANAGEMENT

MBA Program | Semester: 1

BUSINESS COMMUNICATION
Communication
(UNIT 1)
By

Dr. Namita Nath Kumar

 Role of communication
The role or importance of business communication is discussed
below:
• Exchanging information
• Preparing plans and policies
• Execution of plans and policies
• Increasing employee’s efficiency
• Achieving goals
• Solving problems

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• Making decisions
• Improving industrial relation
• Publicity of goods and services
• Removing controversies
• Enhancing employee satisfaction
• Enhancing loyalty

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 Defining Communication
• The word communication has been derived from the Latin
word 'communis' that means ‘common’. However,
communication incorporates, besides commonality, the
concepts of transfer, meaning and information.
• The communication can be defined as the process through
which two or more persons come to exchange ideas and
understanding among them.

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How do we define communication?
"Communication is something so simple and difficult that we
can never put it in simple words,"
T.S. Mathews.
“Communication is the process by which information is
transmitted between individuals and / or organizations so that
an understanding response results.”
Peter Little
“Communication is an exchange of facts, ideas, opinions, or
emotions by two or more persons.”
W.H. Newman and C.F. Summer Jr.
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What is Managerial Communication

“Managerial communication is a process which involves the

transmission and accurate replication of ideas ensured by
feedback for the purpose of eliciting actions which will
accomplish organizational goals.”

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The definition highlights four imperative points:
1. The process of communication involves the communication of ideas.
2. The ideas should be accurately replicated (reproduced) in the
receiver's mind, i.e., the receiver should get exactly the same ideas as
were transmitted. If the process of communication is perfect, there
will be no dilution, exaggeration, or distortion of the ideas.
3. The transmitter is assured of the accurate replication of the ideas by
feedback, i.e., by the receiver's response, which is communicated,
back to the transmitter. Here it is suggested that communication is a
two way process including transmission of feedback.
4. The purpose of all communication is to elicit action.
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 Business Communication
When one communicates to transact some commercial activity i.e.,
providing goods or services, with the intention of generating profits,
then it is termed as Business Communication. It is useful to acquire
the skills of effective writing and speaking. In fact, lack of these may
result in loss of business opportunities. Therefore curriculums of most
business schools the world over cover this subject prominently. It is
also common for prestigious companies to insist upon excellent
communication skills as a requirement at the time of recruitment.

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 Classifying communication
1. On the basis of Organizational structure or relationship:
(a) Formal communication.
(b) Informal communication
2. On the basis of How or direction:
a) Downward communication.
b) Upward communication.
c) Horizontal or lateral or sideward communication.
d) Diagonal communication.
3. On the basis of methods or media used or expression:
(a) Written communication.
(b) Oral communication.
(c) Gestural or non-verbal communication. 9
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A. On the Basis of Relationship or Organizational Structure:
1. Formal Communication: which takes place through the formal
channels of the organization structure deliberately and consciously
established by the management. Such communications are generally in
writing and may take any of the following forms:
(i) Policy manuals
(ii) Procedural and rule books
(iii) Memoranda papers and orders
(iv) Official meetings
(v) Interviews, etc.

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2. Informal communication channels exist outside the official network
and develop because of spontaneous interaction between people
working in an organisation.
Features of Informal Communication
1.It is a product of social interactions, an inevitable part of
organisational life.
2.It exists outside the official network of communication prescribed by
the organisation.
3. There is no prescribed direction for the flow of messages.
4. An active grapevine indicates employees’ keenness to interact with
each other closely and share ideas, opinions, etc.

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Formal Vs.Informal Communication

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B. On the Basis of Flow or Direction:
1. Downward Communication: means communication which flows
from a superior to a subordinate. It is needed:
(i) To get things done;
(ii) To prepare for changes;
(iii) To discourage lack of understanding and suspicion; and
(iv) To let the members of the organization develop feeling of pride of
being well-informed about all organizational matters.
The important examples of downward communication are: Notices,
circulars, Instructions, Orders, Letters, Memos, bulletins, Handbooks,
Annual reports, Loudspeaker announcements and Group meetings, etc.
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2. Upward Communication: means the flow of information from the
lower levels of the organization to the higher levels of authority. It
includes opinions, ideas, suggestions, complaints, grievances,
appeals, reports, etc.
The important examples of upward communication are: Reports,
Meetings, Interviews, Conferences, Letters, Complaints,
Suggestions, Surveys, Union publications and Grapevine, etc.

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3. Horizontal, Lateral or Sideward Communication: The transmission of
information and understanding between people on the same level of
organization hierarchy is called the horizontal communication. Usually, it
pertains to inter-departmental communication, i.e. the communication
between two departmental managers working at the same level of
organization or among subordinates working under one boss. The
horizontal communication is generally of an informal nature that can be in
oral or written form.

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4. Diagonal Communication: The transfer of information between
people who are neither in the same department nor on the same level
of organization hierarchy is called diagonal communication. This type
of communication increases the organizational efficiency by speeding
up information and cutting across departmental barriers.

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C. On the Basis of Media or Expression:
The term communication media refers to the medium used in the
transmission of message and mutual understanding. The various media of
communication have been studied as under:
1. Written communication
2. Oral communication
3. Gestural or Non-verbal communication

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1. Written Communication:
Communication through words, may be in writing or oral. Written
communication implies transmission of message in black and white. It
includes diagrams, pictures, graphs, etc. Reports, policies, rules,
procedures, orders, instructions, agreements, etc. have to be transmitted
in writing for efficient running of the organization.
It provides a permanent record of communication for future reference.
To be effective, written communication should be clear, concise,
correct and complete.

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Advantages of Written Communication:
(i) It ensures transmission of information in uniform manner, i.e. everyone
concerned has the same information.
(ii) It provides a permanent record of communication for future reference.
(iii) It is an ideal way of transmitting lengthy messages.
(iv) It ensures little risk of unauthorized alteration in the messages.
(v) It is the only means of exchanging information at distant places even
beyond telephonic range,
(iv) It tends to be complete, clear, precise and correct.
(vii) It can be quoted as a legal evidence in case of any disputes.
(viii) It is suited to convey message to a large number of persons at one and
the same time.
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Disadvantages of Written Communication:
(i) It is expensive.
(ii) It is time consuming.
(iii) It becomes difficult to maintain secrecy about a written
communication.
(iv) It is rigid and does not provide any scope for making alterations for
inaccuracies that might have crept in.
(v) It is very formal and lacks personal touch,
(vi) It encourages red-tapism and involves so many formalities.
(vii) It may be interpreted in a different manner by different people.
(viii) It often becomes lengthy, when messages are conveyed in writing.
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2. Oral Communication:
It implies the conveying of message through spoken words. It is face to face communication
between individuals and includes communication through telephone, intercom and public speech,
etc. It may take the following forms depending upon the need and situation:
(i) Face to face talks.
(ii) Telephonic conversation,
(iii) Interviews.
(iv) Meetings,
(v) Lectures.
(vi) Conferences,
(vii) Symposiums.
(viii) Radio talks, T.V. and cinema shows,
(ix) Joint consultations,
(x) Announcements, etc.
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Advantages of Oral Communication:
(i) It is less expensive or economical as compared to written communication.
(ii) It is quicker and saves in time.
(iii) It is more effective than written communication.
(iv) It establishes a personal touch and leads to greater understanding.
(v) Misunderstanding or doubts can be removed then and there.
(vi) Immediate reaction, motivation or response of the receiver can be taken,
(vii) It is more flexible and the messages can be changed to suit the needs and
response of the receiver.
(viii) It provides as the only means of conveying messages in times of
emergencies.
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Disadvantages of Oral Communication:
(i) It is less reliable.
(ii) It is influenced by self-interest and attitude of the people.
(iii) Oral communication has the tendency of being distorted.
(iv) It provides no record for future reference.
(vi) It is not suitable for lengthy message.
(vii) It does not provide sufficient time for thinking before conveying the
message.
(vii) It has language problems, one may mean to convey something, but due to
his way of speaking, it may convey something else.
(viii) It cannot be used to communicate with people scattered over distant
places.
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3. Gestural or Non-Verbal Communication:
Communication does not mean merely written or oral messages. It
includes everything that may be used to convey meanings from one
person to another, e.g., movement of lips or the wink of an eye or the
wave of hands may convey more meaning than written or oral words.
Expression through body parts is known as gestural or non-verbal
communication.

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 Purpose of Communication

1. Flow of Information
2. Coordination
3. Learning Management Skills
4. Preparing People to Accept Change
5. Developing Good Human Relations
6. Ideas of Subordinates Encouraged

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Purpose of Communication

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Importance of Communication
in Management
1. Base for Action
2. Planning Becomes Easy
3. Means of Coordination
4. Aids in Decision-Making
5. Provides Effective Leadership
6. Boosts Morale and Motivation

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 Process of communication

Seven major elements of communication process are: (1)

sender (2) ideas (3) encoding (4) communication channel (5)
receiver (6) decoding and (7) feedback.
Communication may be defined as a process concerning
exchange of facts or ideas between persons holding different
positions in an organization to achieve mutual harmony. The
communication process is dynamic in nature rather than a
static phenomenon.

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 Principles of Effective
Communication
1) Clarity
2) Adequacy and Consistency
3) Integration
4) Economy
5) Feedback
6) Need for Communication Network
7) Attention

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 Characteristics of successful
communication
1) Common frame of reference
2) Mutual congruence
3) Compatibility in communication language
4) Compatible environment

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 Communication in crisis
What is Crisis Communication ?
Crisis Communication refers to a special wing which deals
with the reputation of the individuals as well as the
organization. Crisis communication is an initiative which
aims at protecting the reputation of the organization and
maintaining its public image. Various factors such as
criminal attacks, government investigations, media enquiry
can tarnish the image of an organization.

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Need for Crisis Communication
Crisis can have a negative effect on brand image. Crisis
Communication experts are employed to save an
organization’s reputation against various threats and
unwanted challenges.
Brand identity is one of the most valuable assets of an
organization. The main purpose of Crisis Communication
team is to protect the brand identity and maintain the
organization’s firm standing within the industry.
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Crisis Communication Process
• Employees should not ignore any of the external parties and
important clients Come out, meet them and discuss the problem
with them. There is nothing to be ashamed of. If needed, seek
their help. Media must not be ignored. Answer their questions.
Avoiding media makes situation all the more worse
• Don’t criticize individuals. Show a feeling of care and concern
for them. Share their feelings and encourage them not to lose
hope. Encourage them to deliver their level best. Put yourself
in their place. Respect them and avoid playing blame games.

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• Effective communication must be encouraged at the workplace
during emergency situations. Employees should have an easy
access to superior’s cabins to discuss critical issues with them
and reach to a mutually acceptable solution.
• Information must flow across all departments in its desired form.
One should not rely on mere guess works or assumptions during
crisis. Make sure the information you have is accurate.
• Crisis communication specialists must learn to take quick
decisions. Remember one needs to respond quickly and
effectively during unstable situations. Think out of the box and
devise alternate plans for the smooth functioning of organization.
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• Make sure information is kept confidential. Serious action must
be taken against employees sharing information and data with
external parties. Such things are considered highly unprofessional
and unethical and spoil the reputation of the organization.
• The superiors must evaluate performance of employees on a
regular basis. Ask for feedbacks and reports to know what they
are up to. Conduct surprise audits to track performance of
employees.
• Organizations hire crisis communication specialists to overcome
tough times as well as to maintain their reputation and position in
the market.
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 Barriers to communication
1. Physical Barriers: A communication is a two-way process,
distance between the sender and the receiver of the message is
an important barrier to communication. Noise and
environmental factors also block communication.
2. Personal Barriers: Personal factors like difference in
judgment, social values, inferiority complex, bias, attitude,
pressure of time, inability to communicate, etc. widen the
psychological distance between the communicator and the
communicate. Credibility gap i.e., inconsistency between what
one says and what one does, also, acts as a barrier to
communication. 39
3. Semantic or Language Barriers: Semantic is the science of meaning. The same
words and symbols carry different meanings to different people. Difficulties in
communication arise when the sender and the receiver of the message use words
or symbols in different senses. The meaning intended by the sender may be quite
different from the meaning followed by the receiver. People interpret the message
in terms of their own behaviour and experience. Sometimes, the language used by
the sender may not at all be followed by the receiver.
4. Status Barriers (Superior-Subordinate Relationship): Status or position in the
hierarchy of an organization is one of the fundamental barriers that obstructs free
flow of information. A superior may give only selected information to his
subordinates so as to maintain status differences. Subordinates, usually, tend to
convey only those things which the superiors would appreciate.

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5. Organizational Structure Barriers: Effective
communication largely depends upon sound organizational
structure. If the structure is complex involving several layers
of management, the breakdown or distortion in
communication wall arise. It is an established fact that every
layer cuts off a bit of information. In the words of W.C.
Bennis, “Communication gets distorted particularly as it
goes up the hierarchy.”

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6. Barriers Due to Inadequate Attention: Inadequate attention to
the message makes communication less effective and the message
is likely to be misunderstood. Inattention may arise because of
over business of the communicate or because of the message being
contrary to his expectations and beliefs. The simple failure to read
notices, minutes and reports is also a common feature.
In the words of Joseph Dooher. “Listening is the most neglected
skill of communication.” “half listening is like racing your engine
with the gears in neutral. You use gasoline but you get nowhere.”

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7. Premature Evaluation: Some people have the tendency to
form a judgment before listening to the entire message. This is
known as premature evaluation. Premature evaluation distorts
understanding and acts as a barrier to effective communication.
8. Emotional Attitude: Barriers may also arise due to emotional
attitude because when emotions are strong, it is difficult to know
the frame of mind of other person or group. Emotional attitudes
of both, the communicator as well as the communicate, obstruct
free flow of transmission and understanding of messages.
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9. Resistance to Change: It is a general tendency of human beings to stick
to old and customary patterns of life. They may resist change to maintain
status quo. Thus, when new ideas are being communicated to introduce a
change, it is likely to be overlooked or even opposed. This resistance to
change creates an important obstacle to effective communication.
10. Barriers Due to Lack of Mutual Trust: Communication means sharing
of ideas in common. “When we communicate, we are trying to establish a
commonness.” Thus, one will freely transfer information and
understanding with another only when there is mutual trust between the
two. When there is a lack of mutual trust between the communicator and
the communicate, the message is not followed. Credibility gaps, i.e.,
inconsistency in saying and doing, also causes lack of mutual trust which
acts as a basic obstacle to effective communication.
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11. Other Barriers: There may be many other barriers, such
as unclarified assumptions, lack of ability to communicate,
mirage of too much knowledge of closed minds,
communication overload, shortage of time, etc., which cause
distortion or obstruction in the free flow of communication
and thus make it ineffective. Failure to retain or store
information for future use becomes a barrier to
communication when the information is needed in future.

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THANK YOU

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