Chapter 12

  • Communication is the transferring of a message from the sender to the receiver, who understands the message

Process of Effective Communication

Transmitterthe person starting off the process by sending the message
Medium of Communicationthe method used to send a message
Receiverthe person who receives the message
Feedbackthe reply from the receiver which shows whether or not the message has arrived, been understood & acted upon

One-Way & Two-Way Communication

  • One-way communication occurs when the receiver of the message has no chance to reply or respond to the message
  • Two-way communication occurs when there is a reply or response from the receiver
  • Advantages of Two-Way Communication:
    The receiver feels part of the process
    No room for misunderstanding

Internal and External Communication

  • Internal communication is when messages are sent between people working in the same organization
  • External communication is when the messages are sent between one organization and an outsider
  • It is important for a business to have good external communication as well as good internal communication
  • External communication builds the image and efficiency of the business

Methods of Communication



Video conferencing


Quick messages can be sent

Immediate response

Two-way communication

Body language can be considered

No way of telling if a person has understood or listened

Longer response time

Accurate and permanent record cannot be kept

WrittenLetters (formal; not used within firm)

Memos (informal; used within a firm)

Reports (detailed written communications on a specific subject)

Notices (provide information to the staff)



Annual Report (company’s financial performance & plans for the future)

Newsletter (sent to customers; information on company)

Minutes (summary of meeting)

Agenda for Meeting (issues to be discussed at meeting)

Evidence present

Details aren’t missed out

Copies can be sent to many people

Quick and cheap


Direct feedback is not always possible

Not so easy to tell if the message has been received

Language (jargon) can be hard to understand

No opportunity to consider body language


VisualFilms, videos


Charts and diagrams

Appealing and attractive



No feedback

Difficult for some to interpret


Formal & Informal Communication

  • Formal: channels of communication set up and recognized by an organization
  • Informal: grapevine

Communication Nets

  • The ways in an organization in which members of a group communicate with each other
  • Chain Network:
    Upper to lower levels
    Strategic Decisions
    Lacks accuracy due to the confusion and one-way communication
  • Wheel Network:
    Upper level speaks to different departments or regions
    Tactical Decisions
    No opportunity to communicate directly between departments
  • Connected Network:
    Create and discuss new ideas through two-way communication
    Operational Decisions
    Time consuming
    No clear leader

Direction of Communications

  • Downward communication:
    from managers to subordinates
    instructions or statements
    does not allow for feedback
    original meaning could get distorted


  • Upward communication:
    from subordinates to managers
    feedback is given


  • Horizontal communication:
    Same levels of organizations communicate

Why Communication is Important

  • Employees need to know what they are expected to do
  • Managers need to know how employees are getting on
  • Shareholders should know how the firm is performing
  • Suppliers needs to know what the company wants
  • Customers need to know what the firm has to offer and why they should buy from them

Barriers to Effective Communication




Jargon may be used, making the message hard to understandUnderstandable language to be used
He may speak too quicklyMessage should be clear and feedback should be given
Wrong message or wrong receiverRight message should be given to right person
Too long or too detailedBrief message with main points



Message may be lostInsist on feedback
Wrong channel usedAppropriate channel used
Too long a chain of commandShortest possible channel used
No feedback received
Breakdown of mediumOther forms of communication to be made available


May not be listeningFeedback demanded
May not like or trust senderTrust between the two



No feedbackFeedback to be demanded and facilitated
Slow or distorted feedbackDirect lines of communication available



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