What Is Business Communication And Why Is It So Crucial?

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Paras Kela

Senior Writer:

green tickDate: January 10, 2023

Excellent communication is a prerequisite for business success. There’s no denying that having a streamlined communication network is the biggest asset for any organization. Poor communication strategies can cost companies more than $37 billion annually.

At the same time, 97% of employees believe that effective communication positively impacts everyday task performance. For this reason, it’s essential to make sure that you interact with your stakeholders, clients, team members, and vendors well.

But, first and foremost, what exactly is business communication? Also, why is business communication important, and what steps can be taken to improve business communication?

What is Business Communication?

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Join us today as we go into the depths of the different questions surrounding business communication such as the need for business communication, what is effective business communication, and ways to improve business communication, among others.

So let’s start with an understanding of what business communication is.

What is Business Communication?

Business communication is a two-way process of sharing information between different organizational hierarchies and with people outside an organization. A good way of communication is also about receiving information and understanding it well. Feedback is vital in communication, be it from employee management or customers. 

Moreover, communication is a continuous process and an essential trait in managing people and business by creating, discussing, and interpreting ideas, facts, opinions, and feelings about work performance. 

An effective business communication management between employees and administration helps an organization to improve employee engagement and reach its professional goals way faster than its competitors. On the other hand, having seamless contact with people outside the organization will lead to a good relationship with clients and positive branding about your business.

The prime goal of establishing business communication in your organization is to improve organizational practices by coming to a mutual understanding, influencing, or persuading people to work together. According to research, an organization with an effective communication program performs 3.5 times better with peers. 

Effective communication can help you reduce errors and avoid any issues with employee productivity in your organization. It also plays a crucial role in developing a product, managing customer relations, higher employee engagement, and many other facets of business operations.

6 stages of effective business communication

Again, as one might expect, there are various types of business communication, including internal and external communication. Internal business communication can be further classified into several types, including upward communication, administrative communication, and others.

Let’s take a closer look at each of these types to get a better understanding of them.

What Are The Different Types Of Business Communication?

As explained previously, there are two types of business communication– Internal communication and External communication. Let’s start with internal communication.

Internal Business Communication

When an organization communicates inside an organization among its peers or according to the hierarchy, it is internal communication. However, there are three different types of internal communication available for organizations:

A. Upward Communication

Communication done with proper etiquette and mannerisms are significant factors of upward communication. This mode of business communication management represents authority and ensures an easy flow of information between managers and employees and ultimately better employee engagement.

Employees direct the workflow and the information from a manager or someone senior in the organizational hierarchy. The subordinates and managers are responsible for giving a clear tone with an appropriate description of responsibility towards the organization. 

With a proper order of information flow, you can avoid commotion and chaos in your organization and maintain work efficiency and superiority. Also, a single source of information is much more reliable for employees and helps them solve problems. 

B. Managerial Communication

When an organization’s superior or manager shares the information with the employees working in their team or with other managers, the direct communication of the manager with the team helps encourage peers, prepare employees with head-ups for significant announcements, and give performance reviews to employees.

Different types of business communication

A manager with good communication skills will positively affect an organization’s work culture, business goals, employees etiquettes, morals, and values.

C. Horizontal Communication

The flow of information in an organization is across departmental boundaries, either laterally or diagonally. Herein, the people at parallel or the same level of an organization share information to cooperate and collaborate to complete a project.

Some of the benefits of horizontal business communication management in business include direct supervision of employee productivity, helping you recognize the needs for completing the project, helping you clear misunderstandings as soon as possible, easy and effective communication in case of emergency and increased interdependence of departments and discipline among employees. 

Now, let’s talk about external business communication.

External Business Communication

As the name implies, external business communication is communication that takes place between two organizations. In other words, external business communication occurs when information is transmitted between two organizations.

Clients, dealers, customers, government officials or authorities, are examples of external communication stakeholders. Even customer feedback is regarded as a kind of external communication.

External business communication management is typically conducted through email, brochures, newsletters, posters, advertising, and other kinds of multimedia marketing content aimed to persuade customers, clients, partners, and suppliers to perform profitable business transactions or to deliver a message.
5 methods to boost organization productivity with internal communication

External communication’s typical goals and purposes are market analysis, sales practice management, pre-purchase risk management, post-purchase recovery management, and so on. Furthermore, each type of organization leverages external communication for a distinct set of purposes.

For example, For-profit organizations employ external communication to demonstrate the benefits of their products or services to customers. On the other hand, Non-profit organizations use external business communication to raise awareness about their cause, connect with donors and corporate sponsors for fundraising, and demonstrate their potential to make a difference through community support.

The question now is, why is business communication important? Or why should businesses prioritize business communication? Let’s find out in the following section.

The Benefits of Effective Business Communication

The following are some of the most significant advantages of effective business communication management.

  1. Effective workplace communication can help to reduce workplace conflict or tension.
  2. Business communication also promotes open lines of communication and keeps employees and other stakeholders of the firm connected.
  3. Effective business communication boosts workplace productivity by ensuring information is delivered on time and accurately.
  4. External business communication also builds and strengthens strong relationships between clients and organizations.
    Top business communication tools for effective communication
  5. Effective business communication promotes employee morale and fosters a healthy work environment.

These are the five most significant advantages of effective business communication. However, we propose that you adopt the following practices to improve business communication in the workplace:

If you implement these tips correctly, you will be able to significantly improve business communication. Moreover, in addition to communication types, there are four communication styles: analytical, intuitive, functional, and personal. Let’s take a quick look at each of these business communication styles.

Different Business Communication Styles

1. Analytical Communication Style

As the name suggests, this style of business communication management involves analyzing data and speaking on the basis of facts rather than emotions or speculations. This form of communication is good for making points and explaining your side of the argument. It is most effective when you need to state facts and points quickly, one after the other. 

This communication style is very authoritative and indicates a high level of knowledge and understanding of the subject. It is mostly used by people in higher levels of management and other such positions. 

2. Intuitive Communication Style

Intuitive communicators are the exact opposite of analytical communicators. This business communication style takes a more casual route as opposed to one bombarded with facts. Intuitive and innovative ideas are more welcome than mere facts. This business communication style looks at things from a broader point of view, focusing on the bigger picture. 

3. Functional Communication Style

The functional style of business communication management can be said to be a mix of analytical and intuitive communication styles. Functional communicators like a clear understanding of the plan along with all the relevant details. They prefer to communicate in a linear fashion and appreciate it when ideas are supported by facts.

Unlike intuitive communicators who skip around all the data points, functional communicators like to make sure that they get each and every relevant data. 

4. Personal Communication Style

As the name suggests, this form of business communication uses emotions to connect with the people around them. Personal communicators make an effort to understand those around them. They care about the feelings and emotions of those they connect with. They build close and intimate relationships with those around them.

These types of communicators are usually the ones who can hear the words not uttered and read between the lines, especially with people they personally know.

These are the four business communication styles. Choose the one based on your requirement and business objectives.

So far, we’ve learned about what is business communication, different types of business communication, the benefits of business communication, and different business communication styles. Now, let’s look at how to improve business communication or the effective methods to enhance business communication.

7 Ways To Improve Business Communication

Some of the effective ways to improve business communication management are as follows:

A ) Set Realistic Goals for Employees

Provide well-defined, calculable, easy-to-measure KRAs to all your employees so that they can understand their role better and have clarity on their responsibility towards their job.WAYS TO IMPROVE YOUR BUSINESS COMMUNICATION SKILLS

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B ) Closely Monitor Communication

Managers are responsible for checking their department’s performance and communicating it to the top management. They should use advanced business communication tools and inform employees about their performance gaps and take necessary measures.

C ) Schedule Meetings To Discuss Organizational Goals

With agile technologies, you can now set up knowledge libraries to schedule your appointments and meetings. With this, you must check on employees’ efficiency to meet organizational goals.

E ) Interaction With External Groups

Communicate with your customers, suppliers, partners, and more to promote your brand, services and products in the market.

F ) Choose Your Preferred Method of Communication

Choose the best ways to communicate within your organization, from telephonic conversations to face-to-face meetings. Moreover, you can also use various communication technologies like VoIP to communicate effectively with customers, cloud storage to store documents, chat messaging applications, video conferencing with Google Meet, and other popular communication tools. 

G ) Analyze Data

Document your whole process of communication, execute it, evaluate it, and measure it to check whether it has served its purpose or not. Also, use call center KPIs and metrics to measure the outcomes. If you find that the strategy has failed to achieve the set targets, you should consider revising it thoroughly or partially– whatever is needed.

So there you have it– the top 7 strategies to improve business communication. Moreover, as previously stated, VoIP can be the ideal communication system that you should employ for effective business communication. Continue reading to learn more about VoIP and how it may help businesses improve their business communication management.

What Is VoIP and How It Enhances Business Communication?

First, let’s take a quick look at the VoIP phone system.

VoIP is an abbreviation for Voice over Internet Protocol. It is a technology that allows businesses to make and receive phone calls as well as develop communication networks with their customers via the internet. Unlike traditional phone systems, which necessitate multiple types of equipment, physical installation processes, and maintenance activities, VoIP communication, being a cloud-based system, necessitates none of these.

Benefits of VoIP for small business

Furthermore, this modern business communication system comes with a range of advanced communication features that provide numerous business benefits such as reduced calling and operational costs, on-demand scalability, exceptional portability, low maintenance and quick installation, improved voice quality, maximum uptime, and enhanced communication, among others.

On the business communication front too, VoIP provides a number of advantages, as listed below:

  • The lower overall cost will allow you to spend that money on other important operations such as staff training, recruiting more personnel, and investing in other modern technologies. This will, in the end, improve business communication.
  • When you purchase a VoIP phone system from a credible VoIP service provider, such as CallHippo, you access multiple innovative features. These features will ultimately assist you in streamlining workflow and improving the effectiveness of your business communication.
  • Specifically, the portability feature of a VoIP business phone system will allow businesses to access services from anywhere, at any time, and so be available to their clients 24/7. This will dramatically improve communication and allow you to provide the finest customer service possible.
  • The ability to easily scale resources as needed allows firms to manage fluctuating customer intake and eventually offer services without hiccups.

These are the four advantages of VoIP for effective business communication. If you are considering investing in and buying a VoIP phone system, we strongly advise you to partner with CallHippo – the best Business Communication platform.

CallHippo is one of the best VoIP service providers in 2021 as it provides a variety of innovative and business-specific features and services, allows you to integrate the system with other business tools and services, provides exceptional customer support, has multiple pricing plans tailored for businesses of all sizes and scales, and is relatively affordable when compared to other VoIP providers.

Steps To Signup With CallHippo Business Communication System

Wondering how to sign up for CallHippo VoIP services? Simply follow the instructions outlined below:

Step 1: Sign up with CallHippo.

Step 2: Log in with the username and password, and this will take you to the CallHippo dashboard.

Step 3: Click on ‘Add Number’ and select the country you want to target in the ‘Country’ column. After that, you can filter the number type as per your choice and select a number from the number pool.

How to signup with CallHippo VoIP phone system?

Step 4: Choose the best package considering your requirements and make payment.

Step 5: Once you’ve established a centralized virtual phone number for your business, you’ll need to add the rest of your team members as well.

After that, you must link your personal phone number to the virtual number. This enables you to make and receive calls from the country whose phone number you have chosen.

That’s all! However, keep in mind that the users who will be responding to the calls must be first entered into the system.

So that’s it for today. We learned about what is business communication, why is business communication important, the benefits of effective business communication, the different types of business communication, the different styles of business communication, methods to improve business communication management, how VoIP improves business communication, and how to sign up for the CallHippo VoIP system.

We are hopeful that all of this information has expanded your understanding of business communication further and helped you comprehend the importance and need of business communication in organizations. If you decide to invest in modern business communication technologies, don’t forget to consider CallHippo.

The Bottom Line: Effective business communication is critical to the company’s success. It allows you to strengthen internal team communication, promote your brand, products, and services to the outside world, and identify your employees’ strengths and limitations. In addition to investing in the best VoIP phone system like CallHippo, adopt as many of the above-mentioned strategies as possible to enhance business communication.



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