What is Business Communication? Why it’s Important?

By Ian Wells
Business communication?

Effective business communication is a crucial element to the success of any organisation.

Whether it be high-level communication between leaders of an international company, a small team collaborating on work, an external marketing message, or even a teacher and students in a classroom, good business communication skills are what makes a successful company tick.

Since this is an ultimate guide about business communication, we share with you a lot of content. To browse through the different parts of the guide, please click on the links below:

Today, as more of us work remotely – sometimes across vast distances – good business communication is an even more important factor in successful management.

Effective business communication can not only make businesses’ processes more productive, streamlined and coordinated, they also help build engagement with employees and better relationships with customers.

For example, good business communication can reduce email bottlenecks, improve information flow and reduce time-wasting and distractions.

When every person in a company is on the same page, so to speak, it reduces the opportunity for silos to form, whether it be between employees, teams, or management.


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With many more of us working remotely, effective business communication through the use of video conferencing and other web-based tools is becoming even more essential to the daily workings of a business.

Increased employee engagement is a key benefit of good business communications, because it increases productivity, and reduces staff turnover.

Business communication is also beneficial on an external level, whether it be conversing with customers about a problem, creating a marketing campaign, or running a survey or poll.


What is Business Communication?


Business Communication definition

“business communication encapsulates the skills, methods and process by which individuals, groups and organisations share information, collaborate on ideas, learn skills, help colleagues, undertake marketing, and share thoughts as part of a structured business or organisational environment.”


Business communication refers to the interaction itself – the receipt and exchange of information to facilitate an understanding – as opposed to the actual message or the medium used to disseminate it.

Some types of business communication are a single message, while others might go back and forth over a period of time.

Today, due to the fact organisations are getting bigger, are more disparate and are more likely to have employees who are working remotely, effective communication is a key to the success of any company or association – whether you’re talking to employees, customers, service providers, or partners or prospects.

Business communication is usually defined as oral or written communication.


business people at conference event

What is Oral Communication?

Oral communication is the process of the exchange of information between two or more people through word of mouth – literally.

Oral communication takes place between people face-to-face, by phone or video conference and generally refers to any type of contact between people which makes use of words and involves speaking and listening.

Examples of oral business communication include small and large business meetings, staff meetings, video conferences, face-to-face meetings, personal meetings, speeches, study or course lectures, conferences, interviews and telephone calls. Some forms of business communication, such as a virtual hybrid event, will include more than one communication format.


What is Written Communication?

On the other hand, written communication refers to any type of message that makes use of the written word. In business terms, this includes interactions between people that include traditional writing, as well as email, website pages, reports, corporate documents, management guidelines, university course outlines, contracts and other legal documents, web-based collaboration tools, advertisements, manuals, marketing brochures, press releases, blogs and other content.


So, what is Verbal Communication?

People will often confuse oral communication with verbal communication — but they’re not the same.

Verbal communication is something expressed between people in language or words, either spoken or written – and can include sign language, or symbols – whereas oral communication can only be spoken.

In other words, while all oral communication is verbal, not all verbal communication is necessarily oral.

And just in case you were wondering, non-verbal communication refers to the gestures you make, your tone of voice, body language, posture, facial expressions and eye contact, which are also important to be aware of in a business environment.


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What are the types of Business Communication?

Business communication takes place both internally and externally.

There are generally four main types of business communication that you will come across in most organisations.


1. Internal upward communication

Internal upward business communication flows between people up an organisation’s hierarchical structure – for example, from an employee to their manager, a student to a teacher, a manager to the CEO, or the CEO to the board of directors.

The messenger might be an individual, a team, or a group of like-minded individuals. The receiver of the communication might be an individual person or a group of people.

The effective upward flow of information is crucial to the success of any organisation, both with respect to timing and quality of information.

The upward flow of information will allow leaders to make informed decisions about the challenges and opportunities an organisation may face.

Informed decisions are crucial to the success of every manager’s role – whether they’re leading a small team of people or a global corporation.

Internal upward communication will usually take the shape of system-generated forms and other templates, reports, spreadsheets, statistics, analytics, surveys, a study, and feedback that employees provide to their team leaders, managers or other executives.

For example, a report on a virtual event might include information such as total registrants, total participants, length of stay, social media engagement, and the number of leads the event generated.

Internal upward communication should also be an opportunity for each person to have their voice heard. In fact, in today’s business world it’s becoming increasingly imperative to let employees have their say if you want to get the most out of your staff.

Employees who feel their voice is heard are almost five times more likely to feel empowered to perform their best work, one study found.


2. Internal downward communication

Internal downward communication includes any type of process that sees messages travel the other way in the business – namely downwards. But that doesn’t make it any less important.

Internal downward communication is delivered from a manager or another leader to a person more junior in the hierarchical structure.

Effective downward communication is crucial when it comes to keeping an employee motivated, connected with their colleagues and engaged with the organisation’s overall strategy and goals.

It would seem some companies are learning faster than others. A study by Gallup  found that the most successful companies make employee engagement a key tenet of their business strategy, with highly engaged teams showing 21% greater profitability.

When communicating with employees or other stakeholders, leaders should keep communication clear, consistent, and on a planned strategic course.

An example of internal downward communication might be an all-staff update by a CEO to employees, or a written or verbal instruction.


3. Internal lateral communication

Internal lateral business communication takes place between employees in the workplace – whether they are working in the same building, working from home, or on the other side of the world.

This type of communication occurs more regularly than other types of communication, and correspondingly, there are many different ways employees communicate laterally, including face-to-face, email, messaging and chat apps, and video conferencing.

Internal lateral business communication can take place between individuals, teams and departments, as well as from an individual to a group, or from a group to an individual.

Effective communication between staff – especially with more of us working from remote locations – is a cornerstone of any successful business, whether it be weekly team meetings, workshops, a chat session, collaborating on ideas, holding a course or class, or casual get-togethers.

That’s because good lateral communication helps employees remain connected to their colleagues, stay in the loop on projects, and feel valued as a member of a team — all of which are crucial for building engagement and productivity.


4. External communication

External business communication is any information that is published or takes place outside of your workplace.

It happens between various parties, including customers, prospects, vendors, partners and other stakeholders based on a local or international level.

Before you publish or produce any external communication, it’s important to think about how it will be received by your different target audiences each time.

It might be a conference, a speech or presentation. It might be marketing, advertising, or public relations material, a blog, an investor report, a customer survey or a virtual event.

External communication is the tool an organisation uses to inform an audience about its values, mission, strategy and goals.


Methods of Business Communication and How to use them effectively

Thanks to technology, the methods available for individuals and organisations to communicate as part of a business are not only becoming more diverse, they’re also getting easier to use. For most, a range of tools are now used to make their business communication as successful as possible.


customer support executive

Online Communication and Collaboration Tools

Online, or web-based, communication has come a long way from email. Today, instant messaging apps such as Slack, Hangouts and Microsoft Teams make it easy for everyone working on a project or activity to collaborate successfully at any place or time – no matter where they’re based.

The advantages of web-based messaging platforms and email are that they not only allow private conversations but can also accommodate small groups or larger groups across the whole of a company.

They also make teamwork easier and more collaborative by the use of instant messaging, live audio and video, file sharing and comment and annotation options.

You can use them on any internet-connected device, which makes them perfect for working remotely, and they can also be integrated with other solutions such as your CRM, external file sharing application, or project management tool, which makes your business processes more efficient, more responsive and more productive.


Telephone and teleconferencing

When it comes to some communications, sometimes it is best to stick with what’s simple and pick up the phone. If you’re holding a weekly sales meeting with a team on the road, a teleconference is a good option to get everyone together for a remote hook-up without everyone having to be online.


Video conferencing

Whether it’s a team meeting, awards night, annual general meeting, training session or a stakeholder update, video conferencing has grown to become a key tool in every organisation’s communications kit.

The best video conferencing platforms offer high definition audio and video, a modern video conferencing bridge, and specialised in-platform features, such as the ability to share screens, to ask questions via public or private chat, and to see who is on the call.



Whether it’s taking place at an online Annual General Meeting (AGM), at a virtual conference, or as part of a product launch via webinar, an effective presentation will make you and your brand stand out in the crowd.

Virtual presentations are an increasingly popular way for organisations to reach far-flung employees and hard-to-reach clients, customers, prospects and like-minded professionals.


Reports and other formal documents

It’s hard to run a business without running into some kind of internal reporting system or external ‘red tape’ that needs to be addressed with a formal, and sometimes legal, response.

Keeping a track of activities makes the job of everyone in an organisation easier – especially when information is shared across many departments and even different businesses. It reduces confusion, promotes accountability, and provides a reference point for others moving forward.

Formal documentation is also important for many businesses to meet their legal and regulatory requirements.


Chat rooms and forums

Virtual spaces for employees to get together for a formal discussion or a casual chat are increasingly popular for remote workers. Forums can also provide a place for employees to share information both laterally, upward and downward and keep up-to-date with goings-on, which can increase engagement across the whole of an organisation.


Customer management

Today, this includes many activities such as live chat support, interaction on social platforms, online reviews, CRM platforms, and surveys, polls and Q&As.


Face-to-face meetings

While face-to-face meetings have taken a back seat due to the impact of COVID-19, sometimes getting together with someone in the same room can be the best way to move ideas forward.


Polls and surveys

Both internal and external polls and surveys are an effective way to gather insights, feedback, suggestions and new information on opportunities and challenges both inside and outside of an organisation.

The next time you’re planning a virtual event, meeting or discussion, consider including a survey or poll during or after your event.

Communication is at the core of most business processes. Whichever medium you choose, the key is to make sure that everyone involved in the transaction ends up with a thorough understanding of the meaning of the message you’re conveying.


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