This document defines and discusses business communication. It begins by explaining that communication is fundamental to human and organizational existence, and defines it as a process of sharing ideas and information to reach understanding. It then defines business communication as communication relating to business activities like providing goods and services for profit. The document outlines the key elements of the communication process, including the sender, message, encoding, media, decoding, receiver, and feedback. It identifies several key features of business communication, such as being practical, factual, clear, brief, target-oriented, and persuasive. Finally, it discusses some characteristics of the business communication process, such as being an integral part of management and involving two-way traffic and mutual understanding.

1. ESSENTIALS OF
BUSINESS
COMMUNICATION
Unit-I

2. Communication
 Communications is fundamental to the existence and survival of
humans as well as to an organization. It is a process of creating
and sharing ideas, information, views, facts, feelings, etc.
among the people to reach a common understanding.
Communication is the key to the Directing function of
management.

3.  A manager may be highly qualified and skilled but if he does
not possess good communication skills, all his ability becomes
irrelevant. A manager must communicate his directions
effectively to the subordinates to get the work done from them
properly.

4. Business Communication
—Definition and Meaning
 The word “Communication” has come from the Latin
word “communis”, which means common. Thus, communication signifies
sharing of ideas in common. The dictionary meaning of communication is to
convey or exchange information and share ideas.
 It is a process through which two or more persons transmit or exchange
thoughts and ideas among themselves.

5.  According to W. H.
Newman and C. F.
Summer, “Communication
is an exchange of facts,
ideas, opinions or
emotions by two or more
persons.”

6.  It is a two-way channel for
transmitting ideas,
feelings, plans,
commands, instructions,
reports and suggestions
that influence the attitude
towards an organisation’s
objectives.
 The communicator’s goal
is to convey the meanings
or ideas without
distortion.
 Success of the leader and
the enterprise depends
upon adequacy of
communication.

7.  It is the responsibility of the
managers to establish and maintain
the channels whereby they can
convey their own thinking and
policies to the subordinates, and can
receive their reactions and an account
of their problems.

8.  Louis A. Allen defines
communication in the
following manner:
 “Communication is the
sum total of all the
things one person does
when he wants to create
understanding in the
mind of another. It is a
bridge of meaning. It
involves a systematic
and continuous process
of telling, listening and
understanding.”

9.  The definition involves two aspects in communication.
 First, there is something which is transmitted, such as facts, feelings, ideas,
etc. It implies that there must be a receiver if communication is to occur.
 Second, the definition emphasises the understanding element in the
communication process. Sharing of understanding would be possible only
when the person to whom the message is sent, understands in the same sense
in which the sender of message wants him to understand.

10.  So,communication involves something more
than mere transmission of the message or
transmissionand physical receipt thereof.
 The correct interpretation and understanding
of the message is important from the point of
view of organisational efficiency. Effective
communication, as such, might be the
accurate transmission and receipt thereof, and
itscorrect understanding.

11.  Communication made among persons to
convey their personal information, message or
thought are personal communication;
 But exchange of information, facts and ideas
relating to business may be termed as
“Business Communication”.
 Business Communication refers to the
communication relating to business activity
which means providing goods and services to
the consumers with a view to earning profit.

12.  It is a process through which
information, facts, ideas,
orders, advices, decisions,
etc. are conveyed, sent or
exchanged between/among
the persons associated with
business.
 Thus, Communication
relating to trade, law,
Finance, administration,
management etc. of a
business enterprise may be
termed as ‘Business
Communication’.

13.  The success of a business enterprise
depends largely upon good
communication.
 Effective communication wipes out
the hindrances in achieving the target
of a business enterprise.

14.  In this age of
globalisation every
business enterprise, big
or small, requires proper
communication for its
existence.
 The success of any
business concern largely
depends upon successful
communication.

15.  In this age of speed, complexity and
competition, sending of information
regarding the product to the ultimate
consumer is very important.
 Unless they know about the product of
the business enterprise, it is not possible
for them to make contact and buy the
product.
 Communication plays a vital role in this
sphere.

16.  Ineffective communication or
communication failure may cause loss of
money, time, energy, opportunity and
even goodwill of a business

17. Communications Process
 Communication is a
continuous process
which mainly
involves three
elements viz.
 sender,
 message, and
 receiver.

18.  The elements involved in the communication
process are explained below in detail:
 1. Sender
 The sender or the communicator generates
the message and conveys it to the receiver.
He is the source and the one who starts the
communication
 2. Message
 It is the idea, information, view, fact, feeling,
etc. that is generated by the sender and is
then intended to be communicated further.

19.  3. Encoding
 The message generated by the sender is
encoded symbolically such as in the form of
words, pictures, gestures, etc. before it is
being conveyed.
 4. Media
 It is the manner in which the encoded
message is transmitted. The message may be
transmitted orally or in writing. The medium
of communication includes telephone,
internet, post, fax, e-mail, etc. The choice of
medium is decided by the sender.

20.  5. Decoding
 It is the process of converting the symbols
encoded by the sender. After decoding the
message is received by the receiver.
 6. Receiver
 He is the person who is last in the chain and
for whom the message was sent by the
sender. Once the receiver receives the
message and understands it in proper
perspective and acts according to the
message, only then the purpose of
communication is successful.

21.  7. Feedback
Once the receiver confirms to the sender that he has
received the message and understood it, the process of
communication is complete.
 8. Noise
 It refers to any obstruction that is caused by the sender,
message or receiver during the process of
communication. For example, bad telephone
connection, faulty encoding, faulty decoding,
inattentive receiver, poor understanding of message
due to prejudice or inappropriate gestures, etc.

23. Features of Business
Communication:
 Business Communication has certain
features or characteristics which
enable us to distinguish it from other
communication.
 A communication to be business
communication must be:

24.  1. Practical,
 2. Factual,
 3. Clear and brief,
 4. Target-oriented,
 5. Persuasive.

25.  1. PRACTICAL:
 Effective business
communication deals
with the practical aspect
of the information
explaining why, how,
when and the like
queries.
 It avoids impractical,
imaginary, unnecessary
or repetitive information
to eliminate waste of
time. It conveys
important information to
the receiver.

26.  2. Factual:
 In general a business
message contains
facts and figures in
place of overall idea.
Important date,
place, time, etc.
should be
clearly mentioned in
a business
communication.

27.  3. Clear and Brief:
 The language used
in business
communication
should be simple,
clear, brief and
without ambiguity.
Sometimes charts,
photographs,
diagrams, etc. are
used to condense or
clarify the
information.

28. 4. Target-Oriented:
A business
communication must
have a specific
objective and must be
planned properly so
that the objective can
be achieved.

29.  5. Persuasive:
 Business communication
often plays a persuasive
role.
 It persuades an
employee to perform
his/her duties, a
customer to buy a
product or service etc.
 The basic characteristics
mentioned above are
related to the message or
information of the
communication.

30.  The process of business
communication has certain
other characteristics. They
are:
 1. Integral Part of
Management Process:
Communication encompasses
those activities by which
the ideas, opinions and
decisions of the managers
are conveyed to the
subordinates of different
ranks. It also involves the
exchange of facts, feelings,
suggestions and responses
between the superiors and
subordinates.

31.  Communication, in this way, puts the
people into action, guides and directs
their activities, regulates and co-
ordinates them for proper work
performance.
 A manager, thus, performs the
management functions through
communication and managerial
positions become the communication
centres to receive information from
various sources for its transmission to
relevant points.

32.  So, communication is a part and
parcel of management function, and
is, thus, an integral part of
management process. That is why,
Chester I. Bernard remarks, “the first
executive function is to develop and
maintain a system of
communication”.

33.  2. Two-Way Traffic:
 Communication does
not only mean its.
downward movement
from superior to the
subordinates it implies
both the transmission
and reception .
 So, when conveying any
information, a manager
should know its
reactions and responses.
Otherwise, managerial
task of guiding and
directing will be
ineffective.

34.  A man should, thus, not only speak, inform and order,
but should also be able to listen, answer and interpret.
 Communication, therefore, involves two-way traffic
from the managers to the employees and from the
employees to the managers.
 It is not complete unless the message has been correctly
understood by the receiver and its response becomes
known to the sender.

35. 3. Mutual Understanding:
 The basic purpose of business communication is to
bring about understanding between individuals in
the organisation. It is an important element for
establishing human relationships. A leader can
lead and a manager can direct effectively by
establishing perfect understanding with the
subordinates, peers and superiors in the
organisation.
 The greater the degree of understanding presents in
the communication the more possibility that
human action will proceed in the direction of
accomplishing the goals.

36. 4. Pervasive:
 The subject-matter of business
communication covers a wide range and
extends to all functions—purchases,
production, sales, finance, recruitment,
wages, dividends, market standing,
innovation, productivity, etc.
 It also moves through all levels of
management— upward, downward and
sideways. Business communication is,
thus, said to be a pervasive function.

37. 5. Continuity:
 Communication is an ever-present activity and
without it an organisation cannot exist.
Communication is as necessary to an organisation
as blood circulation in a living body. Therefore,
the managers should ensure that adequate and
smooth communication flows in all directions.
 Breakdown of communication results in
misunderstanding, creation of unfavorable
attitudes, hostility and conflict. So, communication
must be a continuous process and move up, down
and sideways for active participation of all
concerned.

38. 6. Specific:
 A business communication is generally
specific in nature. It means that a particular
communication should deal with a single
subject at a time. This is necessary for the
effectivenessof communication.
 Multiplicity of subject in a communication
has the possibility of creating confusion
which is dangerous to sound management. It
must be specific with regard to the
information intended to be conveyed or
received.

39. 7. Result and not Cause:
 Sound communication is the result of competent management,
not the cause of it.
 Business communication is a means to an end and acts as a tool
in the hands of the managers. Successful handling of this tool
depends upon the competence of the managers. It is not an
independent activity, rather an essential ingredient of
managerial function.
 So, good communication does not produce good manager. But
good manager is nearly always a good communicator.
Misconception of management process often leads to poor
communication.

40. 8. Internal and External:
 Business communication is
primarily internal. It is, thus, a
part of administrative function
and intended to apply to the
members belonging to an
organisation.
 Orders, instructions,
suggestions and even public
notice announcing the annual
general meeting of a company
are some of the examples of
internal communication.
 But nowadays, many
communications move beyond
the organisational horizons
and touch the outside
population exceeding the
organisation’s own (e.g.,
advertisement).
 Business communication may
thus be internal and external.

41.  9. Different Types:
 Business communication may be
of different types—formal,
informal, upward, downward,
sidewise, written, oral, etc.

42.  10. Feedback:
 A communication cannot be
complete unless and until feedback
or response of the recipient is
made.
 Feedback may be written, oral or
gestural. Sometimes mere silence
may also constitute a feedback.

43. Importance of Communication
 1. The Basis of Co-ordination
 The manager explains to the employees
the organizational goals, modes of their
achievement and also interpersonal
relationships amongst them. This
provides coordination between various
employees and also departments. Thus,
communications act as a basis for
coordination in the organization.

44.  2.Fluent Working
 A manager coordinates the human and physical elements of an
organization to run it smoothly and efficiently.
This coordination is not possible without proper
communication.

45.  3. The Basis of Decision Making
 Proper communication provides information to the manager that
is useful for decision making.
 No decisions could be taken in the absence of information.
Thus, communication is the basis for taking the right decisions.

46.  4. Increases Managerial Efficiency
 The manager conveys the targets and issues instructions and
allocates jobs to the subordinates.
 All of these aspects involve communication. Thus,
communication is essential for the quick and effective
performance of the managers and the entire organization.

47.  5. Increases Cooperation and Organizational Peace
 The two-way communication process promotes co-operation
and mutual understanding amongst the workers and also
between them and the management.
 This leads to less friction and thus leads to industrial peace in
the factory and efficient operations.

48.  6. Boosts Morale of the Employees
 Good communication helps the workers to adjust to the physical
and social aspect of work. It also improves good human
relations in the industry. An efficient system of communication
enables the management to motivate, influence and satisfy the
subordinates which in turn boosts their morale and keeps them
motivated.

49.  Proper Planning:
 Communication is very helpful in planning the activities of business. It
provides the managers information and ideas necessaryfor sound planning.
 According to Theo Haimann “Only through good communication can
company policies and practices be formulated and administered.” Secrecy of
information creates suspicion among the workers and separates them.
Understanding of the common problems unites them for showing a better
record of their performance.

50.  Basis of Decision-Making:
 Communication helps the managers to take essential decisions and
conduct vital operations. The quality of decisions made in an
organisation entirely depends on the volume and quality of
information available to the management authority. In the absence of
effective communication it may not be possible for top management
personnel to come in closer contact with their subordinates.

51.  Basis of Co-Operation:
 By promoting mutual understanding and meeting of minds, communication
paves the way for co-operation. Communication creates condition for
mental acceptance of the work before its actual performance. This mental
acceptance is the will- to-do before actually doing it. Communication
involves understanding and willing acceptance of orders and instructions
and acts as the basis for individual and co-operative efforts.

52.  Job Satisfaction:
 Proper communication system extends mutual trust and faith. It thus creates
confidence in the ability of their manager, promotes their loyalty to the
enterprise and stimulates their job interest. Proper communication system
enables the subordinates to bring to the notice of the managers their
viewpoints, grievances and troubles. This facility raises the morale of the
workers and, ultimately, leads to job satisfaction for high performance.

53.  Establishment of Public Relations:
 A business enterprise comes into contact with several social groups,
e.g., customers, investors, trade unions, government and the local
community. It must maintain cordial relations with each of these
groups to develop a favourable image. It must continuously strive to
convince the public in general that its actions are taken in the
interest of the society. No public relation can be established without
communication.

54.  Establishment of Effective Leadership:
 Effective leadership is established through communication. The
ideas, orders, instructions, direction, etc., of the leader or manager is
transmitted to the subordinate employees through communication.
The manager can influence them and create a healthy relation by
wiping out misunderstanding and distrust between management
authority and subordinates through communication.

55.  Loyalty:
 The confidence and loyalty of the lower employees on the
management personnel increases as they become aware of the
competence of efficiency of their boss through communication.
It helps to strengthen mutual trust.

56.  Industrial Peace:
 Workers’ unrest is a problem today. It is communication which can establish peace in the
industry. Two-way communication helps to develop mutual cooperation and understanding.
Through downward communication the management personnel send their orders,
instructions, directions, etc. to the subordinates.
 On the other hand, the upward communication helps the subordinates to convey to their
superiors their demands, grievances, complaints, suggestions, etc. Thus, through
communication of facts and information between the superiors and subordinates, industrial
peace can be established.

57.  Assisting Motivation:
 Communication creates motivation. Through it the managers
and employees are well-acquainted with the latest information
relating to the organisation. This leads to avoidance of hostility,
acceptance of reality, change of attitude, consciousness of
responsibility and—ultimately—motivation to work.

58. Classification of Channels of
Business Communication:
 Channels of business communication may be classified from
different viewpoints as follows:

59. Types of Communication
 1. Formal Communication
 Formal communications are the one which flows through the official channels designed in the
organizational chart. It may take place between a superior and a subordinate, a subordinate
and a superior or among the same cadre employees or managers. These communications can
be oral or in writing and are generally recorded and filed in the office.
 Formal communication may be further classified as Vertical communication and Horizontal
communication.

60.  Vertical Communication
 Vertical as the name suggests flows vertically upwards or downwards through formal
channels.
 Upward communication refers to the flow of communication from a subordinate to a
superior whereas downward communication flows from a superior to a subordinate.
 Application for grant of leave, submission of a progress report, request for loans etc. are
some of the examples of upward communication. Sending notice to employees to attend a
meeting, delegating work to the subordinates, informing them about the company
policies, etc. are some examples of downward communication.

62.  Horizontal Communication
 Horizontal or lateral
communication takes place
between one division and another.
For example, a production
manager may contact the finance
manager to discuss the delivery of
raw material or its purchase.

63.  Types of communication networks in formal communication:
 Single chain: In this type of network communications flows from every
superior to his subordinate through a single chain.
 Wheel: In this network, all subordinates under one superior communicate
through him only. They are not allowed to talk among themselves.
 Circular: In this type of network, the communication moves in a circle.
Each person is able to communicate with his adjoining two persons only.

64.  Free flow: In this network, each person can communicate with
any other person freely. There is no restriction.
 Inverted V: In this type of network, a subordinate is allowed to
communicate with his immediate superior as well as his
superior’s superior also.

66.  2. Informal Communication
 Any communication that takes place without following the formal channels of
communication is said to be informal communication. The Informal communication is often
referred to as the ‘grapevine’ as it spreads throughout the organization and in all directions
without any regard to the levels of authority.
 The informal communication spreads rapidly, often gets distorted and it is very difficult to
detect the source of such communication. It also leads to rumors which are not true. People’s
behavior is often affected by the rumors and informal discussions which sometimes may
hamper the work environment.

67.  However, sometimes these channels may be helpful as they
carry information rapidly and, therefore, may be useful to the
manager at times. Informal channels are also used by the
managers to transmit information in order to know the reactions
of his/her subordinates.

68.  Types of Grapevine network:
 Single strand: In this network, each person communicates with the other in a
sequence.
 Gossip network: In this type of network, each person communicates with all
other persons on a non-selective basis.
 Probability network: In this network, the individual communicates randomly
with other individuals.
 Cluster Network: In this network, the individual communicates with only those
people whom he trusts. Out of these four types of networks, the Cluster network is
the most popular in organizations.

70. Barriers to Communication
 The communication barriers may prevent communication or
carry incorrect meaning due to which misunderstandings may
be created. Therefore, it is essential for a manager to identify
such barriers and take appropriate measures to overcome them.
The barriers to communication in organizations can be broadly
grouped as follows:

71.  1. Semantic Barriers
 These are concerned with the problems and obstructions in the process of
encoding and decoding of a message into words or impressions. Normally, such
barriers result due to use of wrong words, faulty translations, different
interpretations, etc.
 For example, a manager has to communicate with workers who have no
knowledge of the English language and on the other side, he is not well
conversant with the Hindi language. Here, language is a barrier to communication
as the manager may not be able to communicate properly with the workers.

74. Types of Semantic Barriers in
Communication
 Denotative Barriers
 Direct meaning of any word which must be shared by two people to understand each
other is the denotative meaning.
 The barriers that arise due to the definition or meaning of a word used differently by
sender and receiver is denotative barriers of communication. They disagree on the
meaning of a word as they are unaware of the other persons’ meaning.

75. Connotative Barriers
 The implied meaning of a word is known as Connotativemeaning.
 Connotative barrier in communication refers to the difference of meaning according to
differentabstract situations, contexts, actions and feelings.
 Both the communicators know both meanings of the word, but use only one meaning
according to the context, which might be being used differently in the context.

76.  For example, the word astonish can be used to describe surprise as well as startle
(SCARE).
 The words, when used by someone, can have any of the meaning.
 The context in which it is used will only let the receiver know what the sender means.
 Another example is the word god, which is used differently by people following
differentreligions.

77. Cultural difference
 Many words have fixed meanings in different norms. So, confusion arises
in communication due to meaning of different signs and symbols in
different cultures, causing semantic barrier. The use of the “Swastika”
symbol in Hinduism and for German Nazi cab be taken as an example.

78.  The symbol was used by Hitler for his rule and is taken as something to fear, whereas
swastika in Hinduism takes it as auspicious and lucky. People belonging to these two
cultures take the symbol differently. If people belonging to these two cultures talk or
use the symbol, it can lead to conflicts.

79. Body language and gestures
 When what you speak and your body language (Kinesics) is
different, the listener can get offended. Inconsistent body
language creates conflict. Sarcasm and contrasts make people
confused or doubtful about the intentions. Action and language
must always go together to make people trust you.

81. Causes of Semantic Barriers in
Communication
 Homophones, homonyms and homographs
 Homophones
 Homophones are the words with same pronunciation but different meaning which
might have different spelling too. For example: Words buy, by and bye. They
have same pronunciation, but different meanings and spellings.
 Homonyms
 Homonyms are the words which have the same pronunciation and their spellings
are mostly same, but the intended meaning is different. For example, the noun
“bear” and the verb “bear” has different meanings but same pronunciation and
spelling.

82.  Homographs
 Homographs are the words that have the same spelling but the
pronunciation and meaning are different. For example, “The research
lead to the discovery of lead”. In this sentence, both the words have the
same spelling, but different pronunciation and different meanings.
 These words can be interpreted wrongly when used unknowingly causing
the semantic barrier in a communication process. This, in turn, makes the
communication ineffective.

83.  2. Psychological Barriers
 Emotional or psychological factors also act as barriers to communication.
 The state of mind of both sender and receiver of communication reflects in effective
communication. A worried person cannot communicate properly and an angry
recipient cannot understand the message properly.

84.  Thus, at the time of communication, both the sender and the
receiver need to be psychologically sound. Also, they should
trust each other. If they do not believe each other, they cannot
understand each other’s message in its original sense.

86.  3. Organizational Barriers
 The factors related to organizational structure, rules and regulations
authority relationships, etc. may sometimes act as barriers to effective
communication.
 In an organization with a highly centralized pattern, people may not be
encouraged to have free communication. Also, rigid rules and regulations
and cumbersome procedures may also become a hurdle to communication.

88.  4. Personal Barriers
 The personal factors of both sender and receiver may act as a barrier
to effective communication. If a superior thinks that a particular
communication may adversely affect his authority, he may suppress such
communication.
 Also, if the superiors do not have confidence in the competency of their
subordinates, they may not ask for their advice. The subordinates may not
be willing to offer useful suggestions in the absence of any reward or
appreciation for a good suggestion.

90. EFFECTIVE COMMUNICATION
 Effective Communication is defined as the ability
to convey information to another effectively and
efficiently.
 Business managers with good verbal, nonverbal
and written communication skills help facilitate
the sharing of information between people
within a company for its commercial benefit.

91. Characteristics of Effective Communication or 7C’s

92.  1.Completeness of the
Message:
 Communication must be
complete so as not to baffle the
recipient.
 the receiver gets all the
information he needs to
process the message and take
action.
 A complete message reduces
the need for follow-
up questions and smoothens
the communication process.
 Better communication
helps in better decision-
making by the latter.
 It develops and enhances
the reputation of an
organization.

93.  2.Conciseness of the
Message:
 The intended message
must be free from
verbosity and should be
so written that it is
intelligible at the first
sight.
 Short and intelligible
message sent to the
receiver is ever appealing
and comprehensible.
 It saves time and cost as it
is understood at the first
instance.

94.  3.Consideration:
 Effective communication
takes into account the
receiver’s background
and points of view.
 If your message hits a
nerve or sounds as
disrespectful, the
emotional reaction of the
receiver might affect the
perception of your
message.
 The content of the
message must take into
account the attitude,
knowledge, and position
of the recipient.

95.  4.Clarity:
 The message to be
conveyed or sent must
have clarity and integrity
for better understanding.
 Clarity of thoughts and
ideas enhances the
meaning of the message.
 The pitch and substance
of the message should be
based on honesty and
accuracy.

96.  5.Concreteness:
 A concrete message is
specific, tangible, vivid. It’s
supported by facts and
figures or enhanced
credibility.
 It helps your audience gain
an overview of the broader
picture.
 Concreteness mitigates the
risk of misunderstanding,
fosters trust and encourages
constructive criticism.

97.  6.Courtesy to be
Maintained:
 The sender's message
should be so drafted or
prepared that it should be
polite, reflective, and
enthusiastic.
 It must show the sender's
respect for the receiver
and be positive and
focused at the receiver.
 Courtesy
means respecting the
receiver’s culture, values
and beliefs – i.e. crafting
a message that is
genuinely polite and
unbiased.

98.  7.Correctness of the
Message:
 The drafting of the
message should be
done in such a manner
that the final message
doesn't have any
grammatical errors and
repetitions of sentences.
 The message should be
exact, correct and well-
timed.

100.  Objectives of communication
 1.information.
 A.external b. internal
 SWOC
 SOURCES:
 1.ENVIRONMENTAL
 2.INTERNAL
 3.COMPETITIVE

101.  1.Old files
 2.Observation
 3.Mass media
 4.Libary research
 5.Chambers of commerce.
 6.Meeting,seminar,conference
 7.Personal interview
 8.Questionnaire
 9.Trade Fair & Exhibitions
 10.current /social media

102.  2.Advice:
 3.Counselling
 4.order
 A)written and oral
 B)general and specific
 C)Procedural and operational
 D)mandatory and discretionary

103.  Suggestion:
 Persuasion:
 Education
 Warning
 Raising Morale
 motivation