What is Business Communication & Why Do You Need It?

Business Communication

Poor business communication can open a business up to too many risks to count. On the other hand, effective communication can help your business develop a competitive advantage, boost employee productivity and engagement, and increase customer satisfaction.

Why is effective business communication at the core of success for every company? How can you achieve it in your own company? It’s time to get the answers you need—and we’ve got them!

What is Business Communication?

Business communication is the process of sharing information between people inside and outside a company. Some types of business communication include:

  • A team of employees holding a brainstorming session
  • Two coworkers sharing information to work on a project together
  • A manager giving feedback to a direct report
  • A leadership team sharing the company’s vision with their staff
  • An account manager presenting a deliverable to a client
  • A client giving feedback on a deliverable

Beyond just sharing information, effective communication is also essential for conducting day-to-day business processes and tasks such as:

  • Making and sharing plans and proposals
  • Presenting new ideas to clients, coworkers, or leadership
  • Having productive meetings
  • Reaching agreements as a team or organization
  • Executing decisions
  • Making sales
  • Taking, sending, and fulfilling orders

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The Importance of Business Communication

Effective communication is a must for any modern business that wants to develop a competitive advantage and be truly successful. Why?

The purpose of business communication is to improve processes and reduce errors—which has become even more vital in today’s hyper-connected, digitally-driven business world. When you and your employees are using so many different devices, tools, software, applications, and platforms to conduct various business processes, you need to ensure that everyone is on the same page and working towards the same organizational goals. Although using many different tools at once increases the risk for error or something slipping through the cracks, strong communication can greatly minimize their risks.

If there are miscommunications, your core systems and processes could quickly fall apart—negatively affecting your business, your customers, and your employees. In fact, yet another benefit of strong business communication is higher employee engagement. When employees are aware of their personal goals, team goals, and the goals of the overall organization, they can work towards them with motivation and confidence.

After all, if your employees have no idea what the goals of a certain initiative are, don’t feel comfortable going to their manager with a problem, or asking their coworker for feedback, how are they supposed to do their jobs effectively?

Plus, when employees feel they can communicate and build relationships with their managers, coworkers, and clients, they’ll be happier on the job. This helps to reduce your turnover rate and the high expenses associated with employee turnover.

When your employees are engaged and satisfied, they’ll also be more productive, which means they’ll be able to produce a higher quantity and quality of work—meaning happier customers and more revenue for your business. The proof is in the numbers: companies with a highly engaged workforce see a 19.2% growth in operating income over a 12-month period, while those with low engagement scores earn on average 32.7% less!

Problems Solved by Effective Business Communication

Without the right business communication processes in place and tools to carry them out, the flow of information in your business will be quickly interrupted—which means miscommunications, uncertainties, and errors.

On the other hand, having the proper business communication processes can minimize risk, frustration, and a whole slew of problems, including:

  • Email overload. Nothing feels more overwhelming than an email inbox overflowing with hundreds of new messages. This isn’t only frustrating, but makes it easier to misplace or completely overlook a crucial piece of information. By outlining clear business communication processes (for example, when it’s appropriate to send a quick instant message rather than a whole email), you can reduce the number of digital distractions and create more space for creativity and collaboration.
  • Drains on productivity. When your employees can’t find a piece of information they need to complete a project, they’re often left searching through endless email chains or wasting time trying to track down the right person to ask. But, when they have organized communication processes in place and access to the right communication tools, these drains on productivity will come to a halt.
  • Horizontal and vertical communication silos. Often times, teams and departments within an organization don’t talk to each other as much as they should be. These silos can be easily remedied with clear communication processes in place for how to reach out between departments and get answers in a timely manner.
  • Low Job Satisfaction. Statistics show that remote workers are 57% more likely to be satisfied with their jobs when working remotely. Effective communication is key for ensuring remote employees remain engaged with their work and feel that their contributions have an impact.
  • Lack of clarity on company culture. When your employees aren’t clear about your values and vision, your company culture won’t be as strong as it could be. This could lead to morale issues in the workplace that negatively impact both job satisfaction and productivity.
  • Employee turnover. Losing top talent is expensive, and one of the biggest reasons for employees leaving their jobs is a lack of communication and disengagement. According to data from Owl Labs, employees who remote work report being likely to stay at their "current job for the next 5 years 13% more than onsite workers."
  • Poor customer service. If there’s poor communication inside your organization, chances are that employees in customer-facing roles won’t have the information they need either. This can affect the quality of the customer service you’re able to provide, which can quickly frustrate customers and send them straight into the arms of the competition.

Types of Business Communication

There are two main types of business communication in a typical organization:

1. Internal Business Communication

Internal business communication is any form of communication between people inside your organization. There are three main forms of internal business communication:

  • Upward communication. This is any form of business communication that comes from a subordinate to a superior, such as a manager, team leader, or C-Suite executive. An example would be a team member asking their boss for more information about a task before completing it.
  • Downward communication. This is any form of business communication that comes from a superior to a subordinate. An example would be a manager giving their direct report a job performance review.
  • Lateral communication. This is any form of internal or cross-departmental communication between coworkers at the same level of the organization’s hierarchy. An example would be an employee in the creative department giving an employee in the marketing department a design to use for a promotional piece.

2. External Business Communication

External business communication is any form of communication that leaves your office and internal staff. It involves communicating with external parties, which might include:

  • Customers
  • Clients
  • Vendors
  • Suppliers
  • Stakeholders
  • Investors

Methods of Business Communication

When business communication actually happens, it’s either verbal or in written form. Furthermore, both verbal and written forms of business communication will take place either in-person or remotely.

There are pros and cons of each—while in-person communication makes it easier to read the other person’s body language and reduce miscommunications or errors, remote communication is essential in our modern workforce while “working from wherever” is the new norm.

That being said, here are some of the most common methods of business communication:

  • Web-based communication. This includes online communication channels such as emails, plus instant messaging applications like Slack.
  • Telephones & audio conferencing. These tools make it possible to run productive meetings even when some or all participants are remote. This type of business communication often enables a better exchange of ideas compared to written communication because it allows you to pick up on the tone of voice of the person speaking.
  • Video conferencing. This is the most effective way to conduct virtual meetings that feel as close to in-person meetings as possible because you can see body language as well as hearing tone of voice.
  • Face-to-face meetings. Research shows that in-person meetings generate more ideas than virtual meetings, so when you are able to get all meeting participants in the same room, you should do so. But, for modern businesses with lots of remote employees or customers across the world, this might not be possible.
  • Reports, files, presentations, and documents. Having important business information in written form reduces the chance for confusion, can be referred back to later to provide extra clarity, and can easily be shared between parties.
  • Surveys. Both internal employee surveys and external customer surveys are a great way to gather feedback, open an additional communication channel, and find ways to make future improvements as a business.
  • Customer management activities. This could include gathering or sharing information through live chat support, a customer relationship management (CRM) system, your customer onboarding process, customer reviews, etc.

Creating Your Business Communication Process

Solid business communication processes are essential for the happiness and productivity of your employees, as well as the satisfaction of your customers. But where do you even start when creating them? Follow these steps to set clear processes that will transform communication in your business:

1. Analyze your current state of business communication

You can’t improve your business communication processes if you don’t know where they currently stand. So, the first step towards creating new processes that will take your business communication to new heights is to take a good hard look at where you’re at right now.

2. Identify gaps and roadblocks

While you’re taking stock of your current business communication processes, think about the issues you and your employees often face. For example, is there one specific team that had low employee engagement scores from a recent job satisfaction survey you conducted? Are employees in a particular department struggling to complete projects effectively and on time? Do you have poor customer service reviews online?

3. Outline core groups in your organization and how they communicate with each other

Look into the structure of your organization and how these groups interact with each other. Just some examples of questions you’ll want to ask include:

  • Which teams and people have to talk to each other on a daily, weekly, and monthly basis? What are they talking about?
  • How are managers tracking progress in their departments? How does that reporting process work? How is feedback given?
  • Which projects and processes need approval from other people in the company? How is this approval process requested and facilitated? What happens after approval is given?

4. Set future business communication goals

Now that you know where your business communication processes currently stand, where the issues are, and who everyone needs to be able to effectively communicate with going forward, it’s time to set some goals. You want your goals to be realistic, timely, and measurable. For example, some business communication goals could include:

  • Having an employee turnover rate of 10% year-over-year by 2022
  • Having a specific employee satisfaction rate on your next quarterly survey, for example, 90% of employees answering with an 8 or above to the question: “On a scale of 1-10, how engaged do you feel your current job role?”
  • Reducing the amount of unnecessary emails sent next quarter by 20%
  • Reaching a specific customer satisfaction rate, for example, an average review of 4.5 stars or above on Google Reviews, within six months

5. Define methods of communication

Now that you have some goals set, you can choose the methods of business communication that will align. For example, for the goal of reducing the amount of unnecessary emails sent next quarter by 20%, a great start would be outlining when is the right time to send a quick instant message instead of an entire email.

6. Document and share your new business communication processes

Setting goals won’t mean anything if you can’t hold yourself accountable to actually meeting them, and defining methods of communication for various situations will be futile if your employees don’t know about them. For these reasons, it’s essential to actually document your business communication goals and processes. Then, you can easily share these documents with others in the organization and refer back to them as needed. These documents will also be a valuable tool that can be shared with new employees to get them up to speed quickly.

7. Evaluate progress and readjust as needed

The goal here is to continuously improve your business communication processes so your business can become more efficient and your employees can stay engaged on the job long-term. For this reason, it’s important to continuously check in on your progress and identify if you’re on track to meet your goals or missing the mark. This way, you can make adjustments as necessary.

You may want to consider creating a recurring calendar reminder for yourself and your team to reevaluate your business communication processes and progress towards your goals once a quarter. This way, you can determine if you’re still on the right path or if you need to pivot.

Technology That Helps Improve Business Communication

Creating your business communication processes is one thing—actually carrying them out effectively is another. The key to doing so is having access to the right tools and technology. Unfortunately, there is no handbook or one-size-fits-all approach that defines which communication tools are best for each purpose.

Gmail vs Outlook? Slack vs Google Hangouts? Skype vs Zoom? There are nearly endless options for business communication tools out there. Your choice will depend on the preferences of you and your workforce, as well as your business size, goals, and budget.

At AVAIL, we want to make effective, cloud-based business communication simpler than ever before. That’s why we offer cost-effective, easy-to-consume packages of cloud-based collaboration tools that will transform your daily use of audio/video conference tools, messaging platforms, business applications, and more!

The result? Happier employees, higher productivity, and huge gains in revenue! Ready to get started? Contact us today!

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