What is Business Communication? Why Do You Need It?

By Team Writer - Last Updated on January 29, 2021
A Brief Explanation About What is Business Communication & How it works

Communication within an organization is essential for effective and successful business operations. The clarity in communication helps to keep everyone on the team on the same page and leads to more collaboration and better results. Business communication is the process of sharing information between teams, team members, and customers inside and outside a company.

Why Business Communication is Important?

Since we know what communication is, it is easy for us to know why communication is important in business. Communication assists in fostering and promoting a good working relationship between the employer and the employees, which in turn improves morale and efficiency. Effective business communication is the process through which knowledge is passed across between employees and the management to reach organizational goals.

The purpose of communication in business is to improve organizational practices and reduce errors. It is therefore important and mandatory for effective communication to exist in businesses, especially larger ones. Once communication is not effective or becomes unclear, the company’s core systems risk falling apart.

Different Types of Business Communication

It is important to know that there are different types of business communication, but in this article, we will be treated two, they are internal business communication and external business communication.

Internal business communication

  • Upward Communication

    Upward communication is the process by which information flows from the lower level of a hierarchy to the upper level. In other words, it is any news that comes from a subordinate to a manager or any individual at the top of the organizational hierarchy. In this technological age, this type of communication is gaining more popularity and usage while traditional forms of communication are becoming less popular.

    As a leader of a company, it is important that information flow upwards so you will know how the company is being run and what is done underneath you. Most of the information that flows upward is based on systematic forms, reports, surveys, templates, and other resources. This is to help employees provide necessary and complete information.

  • Downward Communication/ Managerial Communication

    Downward communication is the flow of information and messages from a higher level inside an organization to a lower one. When leaders and managers share information with lower-level employees, it is called downward, or top-down, communication. Effective downward communication is crucial to an organization’s success.

    While downward communication may sometimes invite a response, it is usually one-directional rather than reciprocal, in the sense that the higher-level communicator does not invite or expect a response from the lower-level recipient. An example of downward communication is instant directives from managers to employees. These can be written manuals, handbooks, memos, policies, or oral presentations.

  • Lateral Communication/Technical Communication

    Lateral communication is “the exchange, imparting or sharing of information, ideas or feelings amongst people within a community, peer groups, departments or units of an organization who are at or about the same hierarchical level as one another for the purpose of coordinating activities, efforts or fulfilling a common purpose or goal”. Simply put, it is the exchange of information between people of the same hierarchy.

    Lateral communication generally takes place in an organization and is neither upward nor downward. It proceeds in a horizontal manner and takes place among equals and at peer to peer level. It is important to note that it is usually among equals, that is why it is also described as peer-level communication.

External business communication

External business communication is any information the company distributes to the public, either about the organization itself or its products and services.

  • Getting and Receiving Instructions and Assignment Both Upward and Downward.

    Receiving instructions from both upward and downward levels helps an employee to know the exact information to communicate to the public. Since external communication focuses on spreading news and information about the corporation to the public, customers, and company stakeholders, the mouthpiece has to receive instructions on how to go about it.

    This is because the goal of external communications is to promote the company and increase revenue. Common examples of external business communications include direct mailings, financial records, press releases, and newsletters.

  • Sharing and Discussing Information, including Information Sharing That Goes on In Meetings.

    Communications are one way to shape and define a corporation’s image to the community, clients, and potential investors. External communications such as newsletters, media stories, and press releases enable the public to know about the company, its philanthropic and environmental efforts, and other image-related activities, all of which serve to strengthen the public relations efforts of a company.

    Sharing information to the public through the company’s website also ensures the customers are fully aware of the upcoming products and services. Social media platforms such as blogs and Facebook are some of the easiest ways to reach people.

    Giving feedback, correction, and discipline to people who report to you so that they can have the knowledge and the tools that they need to do their jobs better.

    As an employer, giving feedback to your workers enables them to do the job more effectively if it is given back to them again. In other words, if an employee completes work and receives no feedback, he/she will think the job was done well meanwhile it wasn’t. This will lead the employee to make the same mistake again if the work is given to them, thereby causing another problem for the company.

    A leader must be able to acknowledge the work done by the employees to make them feel more involved in the company’s progress. This type of feedback gathering isn’t just good for getting an overview of how your company is running.

    It can also help identify potential problems among your staff before they escalate. The purpose of external communication is to have smooth communication between different organizations or entities. Giving feedback to your employees from the task they complete aids the smooth running of the company.

  • Problem Solving and Decision Making Meetings

    In these kinds of important meetings that should be held at least thrice a month, problems are to be tabled before the organization to see how best they can help their employees solve these issues while also making important decisions that would either affect the company in a positive or negative manner.

Methods of Business Communication

  1. Web-based communication

    This is the act of sharing information, words, or ideas over a network of computers known as the Internet. Web-based communication can also be called web conferencing in which meetings, conferences, seminars, presentations, and training take place with the help of the internet. This can take place over the phone or with video equipment.

  2. Telephone meetings

    A business conference call is simply a telephone call involving three or more people. It allows people in different geographic locations to “meet” at a pre-arranged time via telephone, to do things like resolving an urgent business issue that requires the input of several individuals.

  3. Video conferencing

    These Video conferencing systems enable employees at remote locations to hold meetings as though they are together in person.

  4. Face-to-face meetings

    Face to face meetings can help a business move forward as more ideas are provided quickly unlike online meetings.

  5. Reports and official documents

    If you document your activities, it can impact other people and departments and this is a vital part of a well-organized communication system.

  6. Presentations

    Presentations are the best for sharing great ideas and it gives room for questions and further clarifications. It is usually carried out through the use of reports and PowerPoint slide decks.

  7. Forum boards and FAQs

    These are internal areas for employees of the organization to refer to frequently asked questions and to ask new ones that will make them more effective, productive, and up-to-date on various matters.

  8. Surveys

    Both internal and customer surveys are perfect ways to get feedback and ratings on products and services. They facilitate a great cycle of feedback-supported improvements and they open a channel of communication between all levels inside an organization.

  9. Customer management activities

    This includes any customer relations activity such as live chat support, customer relationship management (CRM) systems, customer reviews, and customer onboarding process.

Benefits of Business Communication

  1. Build the Team

    Effective Communication will build your team by discovering their strength and capitalizing on them while also discovering their weakness and improving on them.

  2. Boost Employee Morale

    When there is effective communication, the employee morale and attitude to work are on the upper side and this influences the way they work but when there is no effective communication, morale becomes low and so does productivity.

  3. Increase in Customer Satisfaction

    Effective Communication in this sense is simply talking about Surveys as this helps you to know if your customers are satisfied with your product/service or you need to improve to satisfy them.

  4. Improvement in Productivity

    When there is communication within a business, you would know the areas you need to work on and how to work on them. Once you discover “How” and you do it, productivity will be boosted.

Steps to Set up Your Business Communication Process

  1. Audit your current state of business communication and set goals

    Whether your business is a start-up or is well developed, you need a business communication plan that will focus on the areas that need the most improvement at the moment, while working your way to all other areas as time goes on. For example, it might be a specific employee turnover or customer satisfaction rate.

  2. Identify core groups in your organization and their relationships with each other

    Take time to examine the structure of your organization and all the groups involved in each one’s ability to perform its a day to day activities. Depending on the size of your company, this might be a large or small task, so give yourself plenty of time because this is not a task to be rushed as it could determine the future of your organization.

  3. Define methods of communication

    Now, you must select the methods of communication that align with your business communication goals, as well as how the core groups in your company would interact. It could be a face-to-face meeting, video conferencing, surveys, and many more. Just make sure they meet your needs at every point in time.

  4. Choose the right tools

    There’s no book that spells out which tools are the best for any purpose but when choosing your tools, try to observe the following rules.

    • Make use of a single platform for emails and calendars.
    • Make use of a single tool for chat messaging.
    • Create and develop brand guidelines that will detail the tone of voice and use of brand elements.
  5. Document the process

    Take note of everything you do throughout your business and from time to time, turn it into a document you will share to the entire organization. Through this, every employee can always refer to the communication plan and decide the best action to take in whatever situation they find themselves in.

If you have followed this article up till this point, then you are ready to impact the communication aspect of your business positively.

Team Writer

Team Writer | TechFunnel.com is an ambitious publication dedicated to the evolving landscape of marketing and technology in business and in life. We are dedicated to sharing unbiased information, research, and expert commentary that helps executives and professionals stay on top of the rapidly evolving marketplace, leverage technology for productivity, and add value to their knowledge base.

Team Writer

Team Writer | TechFunnel.com is an ambitious publication dedicated to the evolving landscape of marketing and technology in business and in life. We are dedicate...

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