Business Studies

2.
4 – Internal and
External Communication
Effective Communication
Communication is the transferring of a message from the sender to the receiver, who
understands the message.
Internal communication is between two members of the same organisations. Example:
communication between departments, notices and circulars to workers, signboards and labels
inside factories and offices etc.
External communication is between the organisation and other organisations or individuals.
Example: orders of goods to suppliers, advertising of products, sending customers messages
about delivery, offers etc.
Effective communication involves:
 A transmitter/sender of the message
 A medium of communication eg: letter, telephone conversation, text message
 A receiver of the message
 A feedback/response from the receiver to confirm that the message has benn received
and acknowledged.
One-way communication involves a message which does not require a feedback. Example:
signs saying ‘no smoking’ or an instruction saying ‘deliver these goods to a customer’
Two-way communication is when the receiver gives a response to the message received.
Example: a letter from one manager to another about an important matter that needs to be
discussed. A two-way communication ensures that the person receiving the message understands
it and has acted up on it. It also makes the receiver feel more a part of the process- could be a
way of motivating employees.
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Downward communication: messages from managers to subordinates i.e. from top to bottom of
an organization structure.
Upward communication: messages/feedback from subordinates to managers i.e. from bottom to
top of an organization structure
Horizontal communication occurs between people on the same level of an organization
structure.
Communication Methods
Verbal methods (eg: telephone conversation, face-to-face conversation, video conferencing,
meetings)
Advantages:
 Quick and efficient

 There is an opportunity for immediate feedback
 Speaker can reinforce the message- change his tone, body language etc. to influence the
listeners.
Disadvantages:
 Can take long if there is feedback and therefore, discussions

 In a meeting, it cannot be guaranteed that everybody is listening or has understood the
message
 No written record of the message can be kept for later reference.
Written methods (eg: letters, memos, text-messages, reports, e-mail, social media, faxes,
notices, signboards)
Advantages:
 There is evidence of the message for later reference.

 Can include details
 Can be copied and sent to many people, especially with e-mail
 E-mail and fax is quick and cheap
Disadvantages:
 Direct feedback may not always be possible

 Cannot ensure that message has been received and/or acknowledged
 Language could be difficult to understand.
 Long messages may cause disinterest in receivers
 No opportunity for body language to be used to reinforce messages
Visual Methods (eg: diagrams, charts, videos, presentations, photographs, cartoons, posters)
Advantages:
 Can present information in an appealing and attractive way

 Can be used along with written material (eg: reports with diagrams and charts)
Disadvantages:
 No feedback
 May not be understood/ interpreted properly.
Factors that affect the choice of an appropriate communication method:

 Speed: if the receiver has to get the information quickly, then a telephone call or text
message has to be sent. If speed isn’t important, a letter or e-mail will be more
appropriate.
 Cost: if the company wishes to keep costs down, it may choose to use letters or face-to-
face meetings as a medium of communication. Otherwise, telephone, posters etc. will be
used.
 Message details: if the message is very detailed, then written and visual methods will be
used.
 Leadership style: a democratic style would use two-way communication methods such
as verbal mediums. An autocratic one would use notices and announcements.
 The receiver: if there is only receiver, then a personal face-to-face or telephone call will
be more apt. If all the staff is to be sent a message, a notice or e-mail will be sent.
 Importance of a written record: if the message is one that needs to have a written
record like a legal document or receipts of new customer orders, then written methods
will be used.
 Importance of feedback: if feedback is important, like for a quick query, then a direct
verbal or written method will have to be used.
Formal communication is when messages are sent through established channels using
professional language. Eg: reports, emails, memos, official meetings.
Informal communication is when information is sent and received casually with the use of
everyday language. Eg: staff briefings. Managers can sometimes use the ‘grapevine’ (informal
communication among employees- usually where rumours and gossips spread!) to test out the
reactions to new ideas (for example, a new shift system at a factory) before officially deciding
whether or not to make it official.
Communication Barriers
Communication barriers are factors that stop effective communication of messages.

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2.

 Quick and efficient

 Can take long if there is feedback and therefore, discussions

 There is evidence of the message for later reference.

 Direct feedback may not always be possible

 Can present information in an appealing and attractive way

Factors that affect the choice of an appropriate communication method:

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