The Importance And Types Of Business Communication And Its Aspects

MNGT1001 Introduction to Management

Formal and Informal Channels of Communication

The prime factor for the effective organizational behavior is efficient business communications. Business communication is the concept of sharing or flow of information within the internal environment of the organizations. External environment of the organizations also is influenced by the effectiveness of business communication. It also refers to the communication regarding promotional activities of the organizations for their customers (Guffey & Loewy, 2012). This essay will demonstrate the various channels of business communications along with its different aspects.

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Business communications has different channels and it can be classified in two types (Kaul, 2014). Formal communication channel and informal communication channel are the two types of channels. Formal channel of communication refers to the means of official communicational flow of the organizations. It is normally transmitted from the higher management of the organizations. Any types of notices and circulars are being considered as the formal business communications. This type of communications typically follows the vertical structure due to their transmission from the top to bottom or from the bottom to top of the organization and follows a particular chain of command (Pagani, 2013). The main advantage of this type of communication is its effectiveness. This type of communication is considered as the most effective and outcome-oriented channel of communication. Contemporary organizations are now becoming more complex and large sizes. Therefore, there is an utmost need of bridging the communication gap in the organizations. Formal channel of communication can help in meeting these communication gaps. It has the ability to reach to the last end of the organization effectively. Formal communication also helps in providing filtered information to the upper or lower level of the organizational structure. Formal communication transmits through different levels of the management and thus, it filtered out the unnecessary information and figured out only the required information. The working environment of the organizations depends on the effectiveness of the formal channels of communications. It reflects the professionalism of the organizations and helps in having the control over the employees. Formal channel of organization also carries some drawbacks such as creating obstacle in the flow of free communication. It follows only a specific communication route and hence, natural flow of communication is hindered. Another criticism of formal communication is of time consumption. Formal communication is more time consuming due to its transmission through various managerial levels. Sometimes, decision-making process of the organizations gets affected due to the delay in the flow of formal communications.

Aspects of Effective Business Communication

Another type of communication is informal communication. Informal communication is also known as the grapevine communication (Singh, 2013). It represents the more relaxed way of communications within the internal organizational structure. This type of communication channel transmits more in the horizontal manner (Ruck & Welch, 2012). It is being not preferred as the official or formal channel of communication due to its lack of origins. Any types of gossips or communications between the employees can be termed as informal communication. It is being noted that informal communications sometimes proves more effective then the formal communications. An employee tends to be more comfortable in the informal channel of communications. It promotes free flow of communication in the organizations. It transmits the information to the desired location directly without being delayed in the middle. Thus, it helps in prompt decision-making process. Another advantage of informal communication over formal communication is having the chance of receiving feedback. However, there are some drawbacks of informal communication channel is also present. Lack of credibility is one of the key drawbacks of informal communication channel. It mainly transmits through word of mouth and lacks the official structure. Sometimes it creates trouble in the management, because informal communication channel cannot be controlled and is difficult to identify its origin.

Effective business communication can be followed or implemented in the organizations only by following some aspects of business communications.

The first important aspect of effective business communication is listening (Bodie, 2012). Effective communication can only be implemented if it follows the two-way approach. It is important to listen to what the employees or the lower level management wants to convey rather than just giving one-way orders. Without listening to the opposite voices, the issues cannot be solved. First communication should be transmitting from lower to upper and then the necessary feedback should go the opposite way. Listening will also motivate the employees by letting them to give their opinions and giving value to their voice.

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Another aspect of effective business communications is trust. Any communication will lose its credibility due to the lack of trust. If the team members do not have the trust on the team leader then it will be difficult to implement effective communication in the team. Trust will help in creating free and flexible environment in the organizations.

Focus and control is another aspect of effective business communication. The focus of the higher management of the organization should be equal to all the employees by being rational. They should be focused on solving the problems and finding the solutions for the employees. Leadership role should have the control over the organizations (Northouse, 2015). This will help in effective communication in the organization.

Challenges and Barriers in Effective Communication

Confidence and influence is another aspect of effective business communication. Organizational communication between the lower levels and higher levels can effective only when the higher managerial levels have the ability to show confidence on the subordinates at the time of any issue. Their ability to influence the subordinates is the determinant of how effective communication can be implemented. Employees also should have the confidence on their superiors to convey their opinion to the higher management.

Clarity of information is very important for effective business communication. The message should be customized for the right audience and in the way that employees will understand. Without the clarity of the message, communication flow within the organization cannot be effective and outcome-oriented.

Language is very important for effective communication because different language denotes different meanings for different cultures. Some meaning of language may be acceptable to a certain culture but it may pose as an offensive to the other. Therefore, it is important to use the proper language before communicating with someone in the organizations (Blume & Board, 2013). This is because cotemporary organizations constitute of diversified workforce including people people from different cultural backgrounds. Proper use of language will help in effective business communication whereas; improper use will pose a challenge (Jenifer & Raman, 2015). It should also be noted that tone of the message to be communicated should not be harsh and be in the formal line. A simple and positive message can be perceived as negative due to improper tone of communicating. Use of jargons should be avoided otherwise it will create problems for the receiver to understand. Effective communication will only be possible when the message will be concise, simple and easy to understand.

Effective communication poses some challenges or barriers, which should be overcome to effectively communicate (Chmielecki, 2015).

Mechanical barriers caused in the flow of communication due to any third party issue. There may be any noise in the transmission of the communication due to which, it is not properly communicated to the recipient. Distance may be another mechanical barrier for effective communication. Message can be altered during passing through different managerial levels. Overloading of the communication channel can also pose a challenge for effective communication.

Organizational barriers in communication caused due to lack of effective organizational policies to promote communication (Griffin, 2013). The organizational rules and regulations may not be flexible enough for effective communication. Communications from the higher management may not follow the right channel of communication. The relations between the superiors and the subordinates also affects in the free flow of communications.

Personal barriers refer to any issues related to any individuals, which cause barrier in the communication channel. Language barrier is one such barrier. If the sender and the receiver are having different languages, then lack of common language will create barrier in the effective flow of communication. If the communication process in the organization is one way, then effective communication cannot be implemented.

There are ways to overcome these barriers of effective communications by following some principles. Simple language should be used for communicating which will be understandable to everyone (Beattie & Ellis, 2017). This will ensure to effective communication with all the stakeholders of the organization. Noise is another major barrier in effective communication. Thus, avoidance of noise will help in flexible communication within the organization. Two-way approach should be implemented for active listening. This will help in effective communication between the superiors and the subordinates. Medium of communication should be properly selected to transmit right message to the right audience.

Therefore, all the barriers of the effective communication are being discussed here along with the strategies to overcome them. Effective implementation of these strategies will help the organization to have a free and flexible communication flow within the internal environment. Effective communication is an integral part of the contemporary organizations and is one of the key factors to their effectiveness and efficiency. Therefore, barriers of the communication should be avoided with an utmost importance to have the optimal productivity from the employees of the organizations.


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Singh, M.N., (2013). Does the use of grapevine communication result into improved employee relations and increased business performance: Evidence from education and corporate sector’. International Journal of Social Science and Management, 1(11), pp.39-42.