Management Accounting (BBA32) UNIT-1

Business Communication
Objective
Communication is neither transmission of message nor message itself. It is the mutual
exchange of understanding, originating with the receiver. Communication needs to be effective
in business. Communication is essence of management. The basic functions of management
(Planning, Organizing, Staffing, Directing and Controlling) cannot be performed well
without effective communication. Business communication involves constant flow of
information. Feedback is integral part of business communication. Organizations these days are
very large. It involves number of people. There are various levels of hierarchy in an
organization. Greater the number of levels, the more difficult is the job of managing the
organization. Communication here plays a very important role in process of directing and
controlling the people in the organization. Immediate feedback can be obtained and
misunderstandings if any can be avoided. There should be effective communication between
superiors and subordinated in an organization, between organization and society at large (for
example between management and trade unions). It is essential for success and growth of an
organization. Communication gaps should not occur in any organization.
Business Communication is goal oriented. The rules, regulations and policies of a company
have to be communicated to people within and outside the organization. Business
Communication is regulated by certain rules and norms. In early times, business
communication was limited to paper-work, telephone calls etc. But now with advent of
technology, we have cell phones, video conferencing, emails, and satellite communication to
support business communication. Effective business communication helps in building goodwill
of an organization

INTRODUCTION:

Business communication skills are critical to the success of any organization despite its size,
geographical location, and its mission. Business communication is interlinked with internal
culture and external image of any organization. So it is the determining factor to
communication inside the organization. Good Business communication practices assist the
organization in achieving its goal of informing, persuading, favourable relationship, and
organizational goodwill.

Organizations can only survive if they accept the rapidly changing global challenges and the
communication processes are structured and delivered. The present workforce is dynamic in

Jawahar Science College, Block-14, Neyveli. Page 1 of 5

Management Accounting (BBA32) UNIT-1

nature so communication is a challenge when executed against the backdrop of culture,

technology and competition. The success of any business to a large extent depends on efficient
and effective communication.

It takes place among business entities, in market and market places, within organizations and
between various groups of employees, owners and employees, buyers and sellers, service
providers and customers, sales persons and prospects and also between people within the
organization and the press persons.

All such communication impacts business. Done with care, such communication can promote
business interests. Otherwise, it will portray the organization in poor light and may adversely
affect the business interest. Communication is the life blood of any organization and its main
purpose is to effect change to influence action.

In any organization the main problem is of maintaining effective communication process. The
management problem generally results in poor communication. Serious mistakes are made
because orders are misunderstood. The basic problem in communication is that the meaning
which is actually understood may not be what the other intended to send. It must be realised
that the speaker and the listener are two separate individuals having their own limitations and
number of things may happen to distort the message that pass between them.

When people within the organization communicate with each other, it is internal
communication. They do so to work as a team and realise the common goals. It could be
official or unofficial. Modes of internal communication include face-to-face and written
communication. Memos, reports, office order, circular, fax, video conferencing, meeting etc.
are the examples of internal communication. When people in the organization communicate
with anyone outside the organization it is called external communication. These people may be
clients or customers, dealers or distributors, media, government, general public etc. are the
examples of external communication.

MEANING OF COMMUNICATION
The word communication has been derived from the Latin word 'communicare' that means ‘to
share’. Communication may be defined as interchange of thought or information between two
or more persons to bring about mutual understanding and desired action. It is the information

Jawahar Science College, Block-14, Neyveli. Page 2 of 5

Management Accounting (BBA32) UNIT-1

exchange by words or symbols. It is the exchange of facts, ideas and viewpoints which bring
about commonness of interest, purpose and efforts.

According to Keith Davis, ‘The process of passing the information and understanding from one
person to another." Communication is something so simple and difficult that we can never put
it in simple words," says T.S. Mathews. But we do need a definition to understand the term. In
his book Communication in Business, Peter Little defines communication as follows:
“Communication is the process by which information is transmitted between individuals and /
or organizations so that an understanding response results.” Another very simple definition of
'communication' has been provided by W.H. Newman and C.F. Summer Jr: “Communication is
an exchange of facts, ideas, opinions, or emotions by two or more persons.”

It is essentially a bridge of meaning between the people. By using the bridge a person can
safely across the river of misunderstanding’. It is the ability of mankind to communicate across
barriers and beyond boundaries that has ushered the progress of mankind. It is the ability of
fostering speedy and effective communication around the world that has shrunk the world and
made ‘globalization’ a reality. Communication had a vital role to play in ensuring that people
belonging to a particular country or a culture or linguistic group interact with and relate to
people belonging to other countries or culture or linguistic group. Communication adds
meaning to human life. It helps to build relationship and fosters love and understanding.
Itenriches our knowledge of the universe and makes living worthwhile.

However, communication incorporates, besides commonality, the concepts of transfer,

meaning and information. It implies that there must be a receiver if communication is to occur.
The sender of message must consider the receiver while structuring his message from a
technical standpoint as well as in delivering it. When the receiver is not considered, there is
either no response or there is wrong response. Sharing of understanding would be possible only
when the person, to whom the message is meant, understands it in the same sense in which the
sender of the message wants him to understand. Thus, communication involves something
more than mere transmission of the message or transmission and physical receipt thereof. The
correct interpretation of the message is important from the point of view of organizational
efficiency. As such, the greater the degree of understanding presents in the communication, the
more the likelihood that human action will proceed in the direction of accomplishment of
goals.

Jawahar Science College, Block-14, Neyveli. Page 3 of 5

Management Accounting (BBA32) UNIT-1

IMPORTANCE AND PURPOSE OF COMMUNICATION

Just as communication is vital for our existence in civilizes society, so also it is essential for
functioning of organization. So without communication there would be no organization.
Needless to say, communication is the ingredient that makes organization possible. It is the
vehicle through which the basic management functions are carried out. Managers direct
through communication; they coordinate through communication; and they staff, plan, and
control through communication. Virtually all actions taken in an organization are preceded by
communication.
Purpose of Communication
For instruction:
The instructive function unvarying and importantly deals with the commanding nature. It is
more or less of directive nature. Under this, the communicator transmits with necessary
directives and guidance to the next level, so as to enable them to accomplish his particular
tasks. In this, instructions basically flow from top to the lower level.
For integration:
It is consolidated function under which integration of activities is endeavoured. The integration
function of communication mainly involves to bring about inter-relationship among the various
functions of the business organization. It helps in the unification of different management
functions
For information:
The purposes or function of communication in an organization is to inform the individual or
group about the particular task or company policies and procedures etc. Top management
informs policies to the lower level through the middle level. In turn, the lower level informs the
top level the reaction through the middle level. Information can flow vertically, horizontally
and diagonally across the organization. Becoming informed or inform others is the main
purpose of communication.
For evaluation:
Examination of activities to form an idea or judgement of the worth of task is achieved through
communication. Communication is a tool to appraise the individual or team, their contribution

Jawahar Science College, Block-14, Neyveli. Page 4 of 5

Management Accounting (BBA32) UNIT-1

to the organization. Evaluating one’s own inputs or other’s outputs or some ideological scheme
demands an adequate and effective communication process.

For direction:
Communication is necessary to issue directions by the top management or manager to the
lower level. Employee can perform better when he is directed by his senior. Directing others
may be communicated either orally or in writing. An order may be common order, request
order or implied order.
For teaching:
The importance of personal safety on the job has been greatly recognized. A complete
communication process is required to teach and educate workers about personal safety on the
jobs. This communication helps the workers to avert accidents, risk etc. and avoid cost,
procedures etc.
For influencing:
A complete communication process is necessary in influencing others or being influenced. The
individual having potential to influence others can easily persuade others. It implies the
provision of feedback which tells the effect of communication.
For image building:
A business enterprise cannot isolate from the rest of the society. There is interrelationship and
interdependence between the society and an enterprise operating in the society. Goodwill and
confidence are necessarily created among the public. It can be done by the communication with
the different media, which has to project the image of the firm in the society. Through an
effective external communication system, an enterprise has to inform the society about its
goals, activities, progress and social responsibility
For employees orientation:
When a new employee enter into the organization at that time he or she will be unknown to the
organization programs, policies, culture etc. Communication helps to make people acquainted
with the co-employees, superior and with the policies, objectives, rules and regulations of the
organization.

Jawahar Science College, Block-14, Neyveli. Page 5 of 5