What Is Business Communication and How Can It Benefit Your Company?

What Is business communication?

Business communication is something that every organization does every single day - sometimes well, and sometimes not so well. It’s the exchange of information, ideas and messages both within and outside of a company. It can include speaking, writing and listening to connect with others - including employees, customers, stakeholders and partners.

The aim of business communication is to drive effective decision-making, collaboration and problem-solving so that everyone involved can achieve business goals and can also be empowered to build strong professional relationships.

Table of contents

Why is business communication important?

What are the four types of business communication?

Business communication vs. business communication services

How business communication impacts your company’s success

Problems that effective business communication can solve

5 steps to set up your business communication process

Business communication channels

Conclusion

Why is business communication important?

Business communication is essential for the smooth operation and success of any organization. Here’s why:

• It helps to prevent misunderstandings and ensures everyone is on the same page.
• It fosters trust and rapport among employees, customers and partners.
• When relevant information is shared quickly and accurately, people can make timely and informed decisions.
• It can be used to address conflicts and disagreements constructively, and maintain a positive working environment,
• When there are open lines of communication that encourage employee feedback and ideas, you can boost levels of morale and engagement within your team.
• Collaboration is improved as teams work better together when they communicate well, leading to increased productivity.
• Customer satisfaction is more likely to improve when they receive clear and responsive communication from your company.
• Critical situations and emergencies are better managed when there is timely and transparent communication.

Want to learn more about optimizing your organization's communication?

Download our free Internal Communication Plan: 10-Step Strategy + Template to start improving today.

What are the four types of business communication?

Communication is the cornerstone of a successful business. Whether you’re the CEO sharing your vision and goals with your organization, or a customer service consultant helping clients in a call center, clear and effective communication is necessary to ensure the company’s success.

There are four types of business communication—upward, downward, lateral, and external—each with its unique strengths and challenges. There are pros and cons of each type, which we will explore below:

Upward communication

Upward communication involves interactions that move up the business hierarchy, like a direct report speaking to a manager or a manager reaching out to an executive. This type of communication keeps upper management informed and gives employees a chance to voice concerns or make suggestions.

To be successful, there should be systems and processes in place where regular feedback is encouraged and captured effectively so it can be sent “up the line” for actioning.

Pros:

• Encourages information flow to upper management from frontline staff
• Helps management to address any employee needs or concerns early on
• Promotes cross-level interaction
• Fosters an open and transparent company culture

Cons:

• Power dynamics and any poor interpersonal relationships can discourage openness
• Communication is hindered when employees have limited access to management.

Downward communication

As the name suggests, downward communication is the opposite of upward communication. Downward communication flows from the top of an organization to lower levels. Ideally it is used alongside upward communication to keep everyone in the organization aligned.

This communication includes managers giving instructions to their direct reports or executives sharing goals with managers, or the wider organization. Managers use downward communication to share information, set goals, delegate tasks, enforce standards and provide guidance to their teams.

Pros:

• Ensures information is shared with the team
• Helps with the delegation of priorities and responsibilities
• Helps to communicate goals, policies and procedures
• Assists with enforcing rules within an organization and helps to address emerging issues.

Cons:

• Sometimes the flow of information from the top down can be slow
• Without upward feedback, employees can’t voice what is happening on the ground, and can also feel undervalued and frustrated.

Video Message From CEO to Employees: Full Guide 2024

Lateral communication

Lateral communication is what happens when employees interact across different departments within the organization, or with peers at the same level. Another term for this is “breaking down information silos”. 

A cross-organizational approach to communication, this includes coworkers discussing a project or managers deciding on a new hire. Lateral communication promotes collaboration, coordination and builds a stronger team environment, which ultimately assists organizations to achieve their goals.

Pros:

• Encourages knowledge sharing and problem-solving across the organization
• Builds overall team cohesion and coordination
• Is often quick and informal, which is good for enhancing productivity
• Helps to reduce information silos and internal conflicts.

Cons:

• It can potentially trigger an “us vs them” mindset among different teams
• When there is competition among employees, this can hinder collaboration.
• Informality can lead to misunderstandings.

Building Bridges: Strategies for Breaking Down Organizational Silos

External communication

External communication involves sharing information from within an organization to external parties, such as clients or the public. Examples can include sending a proposal to a client, issuing a press release about a new product or service or promoting the company on social media, email or via the company website. Examples of external communication may be business to business, or business to consumer.

Pros:

• Putting effort into external communication can build a positive reputation for the company
• Fosters stronger customer and client relationships
• Helps the company to grow and achieve its goals.

Cons:

• Poor external communication can damage reputation
• There is less room for errors in external messaging
• If internal communication is weak, there will be challenges in ensuring strong external communication.

Business communication vs. business communication services

Business communication as a concept shouldn’t be confused with the tools that help to facilitate it.

Business communication involves the exchange of information both within and outside of an organization. This often includes emails, meetings, videoconferences, telephone conversations, reports and presentations. Its function is to ensure clear and effective interaction between employees, managers, clients and stakeholders to facilitate collaboration, decision-making and relationship-building.

On the other hand, business communication services are specialized tools and solutions designed to enhance and streamline this exchange of information.

These services include things like virtual receptionists, customer support chatbots, email management systems,and internal communication platforms like Slack, Microsoft Teams or DeskAlerts. These tools help businesses to manage their communications more efficiently, improve response times and maintain consistency in messaging.

While business communication focuses on the content and processes of interaction, communication services provide the infrastructure and technology to support and optimize these interactions to enhance overall communication effectiveness.

How business communication impacts your company’s success

Business communication is not just about exchanging information - it is vital element that influences various aspects of a company's success:

Builds a positive company culture

In order to shape and maintain a positive company culture, you need to have effective business communication practices embedded in your organization. When communication flows smoothly and transparently, your employees will feel more connected to the organization and its goals.

Clear and open communication fosters trust among team members and between management and staff, which is necessary for creating a supportive work environment where employees are encouraged to collaborate, share ideas and contribute to the company's success. Regular feedback, recognition and communication about the company's vision and values helps align employees with the organization’s culture, which in turn boosts levels of engagement.

Encourages innovation

When employees communicate openly, they can share ideas, brainstorm solutions to problems and collaborate on creative projects. A culture that promotes the free exchange of ideas helps in identifying new opportunities and tackling challenges in innovative ways.

Managers who actively listen to their team members and encourage them to voice their ideas will create an environment where innovation thrives. Additionally, when there is clear communication it ensures innovative ideas are effectively presented and considered.

Improves your business operations

Business operations can be significantly streamlined when there are effective communication practices embedded in an organization. Essentially, it ensures that everyone within the company is on the same page regarding goals, responsibilities and deadlines.

Clearly conveying expectations and providing regular updates helps to prevent misunderstandings and reduces the likelihood of errors.

Companies that use efficient communication channels are able to be more responsive and agile and facilitate faster decision-making and and problem solving by exchanging critical information in a timely manner.

Keeps employees happy

Studies have shown time and time again that there is a link between employee satisfaction and how well communication is handled within a company. When employees feel informed about organizational changes, receive regular feedback and have their concerns addressed promptly by management, they are more likely to be satisfied with their work environment.

A sense of trust and loyalty can be built by regular communication with staff, but also by ensuring that this communication is both transparent and empathetic. When employees are happy they are more likely to be productive, commit to remaining with the company and have lower rates of absenteeism and presenteeism.

Promotes customer satisfaction

There’s also a clear link between business communication and customer satisfaction. Effective communication with customers involves clear, timely and relevant interactions, via functions such as customer service, marketing or sales.

Good communication helps employees understand customer needs so they can address their concerns and provide solutions that meet their expectations. By maintaining open lines of communication, companies can build stronger relationships with their customers, leading to higher satisfaction levels, repeat business and positive word-of-mouth referrals.

Discover how our communication solutions can help you streamline internal communication and boost employee engagement.

Problems that effective business communication can solve

Adopting effective business communication practices can help your organization to overcome a range of common challenges.

Email overload and lack of everyday productivity and clarity

Email overload is a significant issue faced by many organizations - with a survey from Edison Software finding that three quarters of Americans admit to feeling overwhelmed by email.

Too much email can be disruptive and lead to decreased productivity, as employees receiving an excessive number of emails find it challenging to prioritize and respond to them efficiently.

Effective business communication can alleviate these problems through the implementation of clear communication protocols and using tools that streamline email management. For example, adopting collaboration platforms like Slack or Microsoft Teams or internal communication software tools like DeskAlerts can reduce the reliance on email for internal discussions, allowing for real-time communication and better organization of conversations.

Horizontal and vertical communication silos

Communication silos, whether horizontal - between departments or teams, or vertical - between different levels of hierarchy within a company, can significantly hinder organizational efficiency.

They are very common in many work environments, with a PwC report finding that 55% companies operate in silos which create barriers to information flow and lead to misunderstandings, duplicated efforts and missed opportunities.

Businesses can overcome silos by promoting a culture of open communication and collaboration. This includes things like implementing regular cross-departmental meetings, fostering interdepartmental projects and using integrated communication platforms to bridge these gaps.

Poor communication with remote workers

With the rise of remote work, effective communication with remote employees has become a critical issue for many organizations.

A Hubstaff survey found that 45% of remote workers identified poor communication as being their biggest workplace challenge.

Poor communication can lead to feelings of isolation, misalignment with company goals and reduced productivity.

Leveraging technology that facilitates virtual meetings, real-time collaboration and provides regular updates can help companies improve communication with remote employees.Tools like Zoom, Microsoft Teams, DeskAlerts and project management software can help maintain connections and ensure that remote workers stay informed and engaged.

Employee turnover and low employee engagement

High employee turnover and low engagement are often linked to poor communication practices in the workplace. When employees feel disconnected from their roles, lack meaningful feedback mechanisms or are unclear about their responsibilities, their motivation and commitment to the company can wane.

Gallup’s 2024 State of the Workplace report reveals that only 23% of employees worldwide are engaged. This means most businesses have a huge problem.

Addressing this issue will involve enhancing communication strategies to foster a supportive work environment. Sharing information in a timely way, constructive feedback and open channels for employee input can help increase engagement and satisfaction. Additionally, recognizing and addressing employee concerns promptly can prevent dissatisfaction and reduce turnover rates.

Poor customer service

Effective communication is crucial for delivering excellent customer service. Poor communication can lead to misunderstandings, unresolved issues, and negative customer experiences, damaged reputation and at the end of the day, a hit to a company’s bottom line. In fact Customer Care Measurement and Consulting found that in America alone, $494 billion in revenue.

Businesses should invest in training for their customer-facing teams to improve communication skills and ensure they are well-versed in handling inquiries and complaints. Implementing clear protocols for responding to customer issues and using customer relationship management (CRM) systems to track interactions can also improve service quality.

The importance of non-verbal communication in business

As humans, we communicate a lot more by what we don’t say than what we do. Around 93% of all communication is estimated to be non-verbal. It encompasses body language, facial expressions, eye contact, posture and gestures - all of which can have a significant impact on the way messages are received and interpreted.

In business settings, non-verbal cues can enhance or undermine verbal communication. For example, maintaining eye contact and exhibiting a confident posture can project professionalism and credibility, while closed-off body language or a lack of eye contact might suggest discomfort or disengagement.

These non-verbal signals also help in building rapport and trust and are crucial for successful negotiations and team dynamics.

Effective non-verbal communication aids in understanding emotions and intentions that might not be explicitly stated. On the other hand, misinterpretations of non-verbal cues can lead to misunderstandings, highlighting the importance of being aware of both your own and others' non-verbal signals.

Being mindful of your non-verbal cues can help your business interactions. These are the best practices for building trust and clarity:

• Maintain eye contact during conversations to show attentiveness.
• Use open body language, such as uncrossing your arms and displaying a relaxed posture so as to appear approachable.
• Ensure your facial expressions match the messages you are communicating. For example, smile to convey friendliness and nod to show agreement or understanding.
• Use hand gestures to emphasize points - but avoid overdoing them.
• Ensure the tone of your voice is calm and clear.
• Respect the personal space of other people so as to avoid discomfort.
• Practice active listening and include appropriate non-verbal cues such as nodding and leaning slightly forward to show engagement and respect.

5 steps to set up your business communication process

Implementing a business communication process is essential for your company to ensure clarity, efficiency and consistency in information flow within the organization. It will help you to enhance collaboration among your team members and lead to better decision making and problem solving.

A structured communication process helps reduce misunderstandings and errors, and improves overall productivity.

Here are five key steps to set up a robust business communication process:

Audit your current state of business communication and set goals

The first step in setting up an effective communication process is to conduct a thorough audit of your current communication practices. This involves evaluating how information is currently shared within and outside your organization, identifying any gaps or inefficiencies and assessing the effectiveness of existing communication channels. Gather feedback from employees, managers and stakeholders to understand their experiences and challenges with the current processes.

When you have a clear understanding of the existing communication landscape, you can then set specific and measurable goals for improvement. For example you might aim to reduce email overload by a certain percentage, improve response times to internal queries or enhance cross-departmental collaboration. Setting clear objectives will provide direction and help to measure the success of your new communication process.

Identify core groups in your organization and their relationships with each other

It’s important to understand the structure and relationships within your organization so that you can design an effective communication process. Identify the core groups, such as departments, teams, management levels, people at specific geographic locations, and map out how they interact with one another. This includes understanding the flow of information between different levels of hierarchy and between different functional areas.

For example, determine how information moves from the executive team to department managers and how it is then disseminated to staff. Understanding these dynamics will help you identify any communication bottlenecks or gaps and ensure that your communication process supports efficient and effective information exchange across all groups.

Define methods of communication

Once you have a clear picture of the current communication state and organizational structure, you need to define the methods of communication that will be used to achieve your goals. This includes specifying the types of communication (e.g., email, meetings, instant messaging) and the contexts in which they should be used.

It’s important to establish guidelines for each method of communication. For instance, decide when to use email versus instant messaging or when face-to-face meetings are necessary. Clear guidelines help ensure that communication is purposeful and appropriate for the situation, reducing confusion and improving efficiency.

Choose the right communication tools

All communication tools are not equal, and different tools are better for different tasks. It’s important to understand this, and to select the right tools for your communication process.

Based on the methods you’ve defined, choose tools that align with your organization’s needs and goals. This may include email platforms, collaboration tools (e.g., Slack, Microsoft Teams), project management software (e.g., Asana, Trello), and video conferencing tools (e.g., Zoom, Google Meet) or unique digital tools such as pop-up notifications, scrolling tickers or corporate screensavers.

Consider factors such as ease of use, integration with existing systems and scalability when choosing your communication tools.

Document the process

The final step is to document your communication process comprehensively. Create detailed documentation that outlines the communication methods, tools, protocol and guidelines that you’ve established in the previous steps. This documentation should include:

• An overview of the communication process
• Guidelines for using each method of communication
• Instructions for using the communication tools you’ve selected
• Roles and responsibilities related to communication within your organization.

Having a well-documented process ensures consistency and clarity in communication practices across the organization. It also serves as a reference for training new employees and for ongoing evaluation and improvement of the communication process.

Internal Communication Plan: 10-Step Strategy + Template

Business communication channels

Choosing the right internal communication channels can significantly impact how information is exchanged and understood within an organization. Here’s an overview of different business communication channels, including DeskAlerts tools, which can enhance your organization’s communication strategy.

Email

Despite the issues with email overload, it remains one of the most widely used communication channels in business. It is ideal for formal communication, such as sending reports, proposals and official announcements. Email allows for detailed and well-documented exchanges, making it a reliable method for sharing important information and maintaining records. To get the most out of email, you should consider establishing protocols around its use: when it should be used, and when other channels might be more appropriate so as to avoid contributing to email overload in the workplace.

Instant messaging

Instant messaging platforms, such as Slack or Microsoft Teams, facilitate real-time communication and are particularly effective for quick exchanges and team collaboration. These tools support group chats, direct messaging and file sharing which makes them valuable in fast-paced and dynamic situations.

Video conferencing

Video conferencing tools, such as Zoom, Microsoft Teams, Skype or Google Meet have become essential staples of the modern workplace for facilitating remote meetings, presentations and collaborative sessions. They enable face-to-face interaction without physical presence and help to connect people without having to travel.

Project management tools

Project management tools, like Asana or Trello, are designed to facilitate communication regarding project status, tasks, delegations and deadlines. They offer features such as task assignments, progress tracking and shared project boards that help teams stay organized and aligned.

DeskAlerts tools

DeskAlerts is a specialized internal communication system that comes with a range of digital tools and other features that have been designed to address various business communication needs. It is particularly useful for sending internal notifications and alerts and offers features such as pop-up alerts, emergency notifications, scrolling tickers, corporate screensavers, digital signage displays, surveys, quizzes, and more.

DeskAlerts delivers messages directly to employees’ screens in real time, bypassing the email system and ensures critical information is seen promptly so that it can be acted on. You can use it to send tailored messages and alerts based on user roles, departments, geographic location or criteria of your choosing. It can also be integrated with existing systems and tools to provide seamless communication across platforms and offers analytics and reporting features to track the effectiveness and reach of your communications.

Struggling with email overload, communication silos, or remote workforce challenges?

Get a personalized demo of DeskAlerts and see how we can help solve these issues for your team.

Conclusion

Effective business communication is vital for the success of an organization. By prioritizing your internal communications processes and investing in the right tools for successful communication, your workplace will be more productive, employees more engaged, collaboration will be boosted and everyone will be working towards the same goals. It’s also important for customer satisfaction and company profits. Get in touch with our team of business communication experts for a free demonstration of how DeskAlerts tools can be implemented in your organization to enhance your communication.