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Unit10InternalBusinessCommunicationElectronicMedia AndShareholderCommunication
Structure
10.1 Introduction Objectives 10.2 WhatisanIntranet? 10.2.1AdvantagesandDisadvantagesofIntranet SelfAssessmentQuestions1 10.3 CommunicatingthroughEmail 10.3.1 PrinciplesofEmailCommunication 10.3.2 EmailEtiquette SelfAssessmentQuestions2 10.4 CommunicationwithShareholders 10.5Summary TerminalQuestions AnswerstoSAQsandTQs 10.1Introduction In the previous unit, we discussed communication with employees through written channels, includingmemos,circularsandnotices.Today,theadventofcomputersandtheinternethasenabled muchquickercommunicationwithemployeesandspeedierdecisionmaking.Evensmallcompanies have access to email and the intranet, which have made memos, circulars and notices almost outdated. In this unit, these two electronic media for internal business communication will be discussed,includingtheiradvantagesanddisadvantagesandtheprinciplesofcommunication. Apartfromemployees,shareholdersarealsoimportantinternalstakeholders,asmentionedinoneof theearlierunits.Partofthisunitwillfocusonthereasonsforcommunicationwithshareholdersand themediausedtocommunicatewiththem

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LearningObjectives: Afterstudyingthisunit,youshouldbeableto.

1. Understandthemeaningandpurposeofanintranet 2. Appreciatetheadvantagesandproblemsinusinganintranet. 3. Communicatemoreeffectivelythroughemail. 4. Practicetheprinciplesofelectroniccommunication 5. Understandwhyshareholdersareimportantstakeholders


10.2WhatIsAnIntranet?
An intranet is similar to a website, except that it is an internal network that is exclusive to a particularorganization.Thismeansthatonlyemployeesoftheorganizationwillhaveaccesstoit. This is as opposed to an extranet, which is also an internal or private website, but where access privileges are also extended to external stakeholders of the company, such as customers,suppliers,partnersandothers. Although the intranet is better suited for large organizations where distributing information is an enormous task, a number of smaller companies today are also using this form of internal communication. Simplydefined,theintranetisatoolfordistributingandsharinginformationofdifferenttypeswithin the company. For example, weekly reports, goals, human resources related information such as employee benefits and declared holidays, interactive forms, vacation requests, supply orders, companypoliciesandevenmemosandnoticescanbepostedontheintranet. Apartfromlargeorganizations,theintranetisparticularlysuitedforvirtualcompaniesthathaveonly anonlinepresence,aswellascompanieswithfrequentlytravelingemployeesandoffsiteworkers, sincecommunicatingwithsuchemployeesbecomesachallenge.

10.2.1 AdvantagesAndDisadvantagesOfIntranet
Likeanyothertool,theintranethasitsadvantagesandlimitations.Someoftheprimaryadvantages are

DiscouragesgrapevineGrapevine,ortheinformalcommunicationnetworkwasdiscussed in one of the earlier units. Although grapevine can be useful, it also leads to rumors, in the

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absenceofinformationpassedonthroughtheformalcommunicationnetwork.Whenemployees are misinformed, they become dissatisfied and demotivated. Using the intranet as an official channel to post informationfor all employees tosee discourages gossip and avoids creating a transparencygap.

Facilitates premeeting discussion The intranet may be used todiscuss and debate ideas priortoameeting,sothatvaluablemeetingtimeisspentfocusingonlyonrelevantideas.

ExampleSupposeasalesteamoffivemembersarerequiredtomakeapresentationtotheVice President Sales, on how to increase sales during the current year. Instead of each salesperson makingalengthypresentationduringameetingandthengettinghisideasreviewedandapproved,a discussion board can be created using the intranet, a few days before the meeting. The salespersonscouldposttheirideasonthediscussionboardfortheVPtoreviewinadvance,sothat only the most promising ideas are discussed during the meeting. This way, the salespersons can comeintothemeetingmorefocused.

SavestimeTheintranetispaperlesscommunicationandisthereforeabigtimesaver.Alotof unnecessarytimewastedonfillingoutforms,leaverequests,supplyorders,etc.,canbesaved bydoingthisthroughtheintranet. EmployeescangetinformationonofficialholidaysandotherHRrelatedinformation,without havingtointeractwiththeHRmanager.

Issuperior toemailSendingsometypesofinformationthroughemailcansometimescreate confusionandinformationoverload.Letustaketheaboveexampleofthesalesteammakinga presentation on how to increase sales. If five salespersons each have three different ways in which they could increase sales and start emailing multiple versions of their Power Point presentationsfortheVPtoreview,itcouldleadtodisastrousresults.Instead,theycouldworkon asharedfile,byusingtheintranet.Acentrallocationcouldbecreatedforthemostrecentfile.

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Whiletheintranetsavesvaluabletimeandmoney,itisnotwithoutitsdownside.Beforeanintranet canbesetup,alotofgroundworkneedstobedone.Youneedtodeterminewhatyouwantittodo andhowemployeeswilluseit.Someofthedisadvantagesare

GettingstartedBuildinganintranettoyourspecificationscanbeexpensive.Aconsultantmay havetobehiredtogiveitthedesiredlookandfeelandtomakesurethatitisuserfriendlyand simpleenoughforallemployeestouse.

Developing and maintaining content Once it has been set up, someone has to be responsible for maintaining and updating the information on a continuous basis. In small organizations,itmaybesufficienttoappointonepersontodothis.Inlargerorganizationswith multiple departments, it may be necessary to appoint several persons to maintain and update informationforthedifferentdepartments. Thisbecomesacomplexandexpensivetask.

TrainingemployeesOnceithasbeensetup,employeeshavetobefamiliarizedandtrained onhowtousetheintranet.Thisinvolvesinvestmentintimeandmoney.

ConvincingoldeconomyemployeesSomeemployeesmaynotbetechnologyorcomputer savvyandmaybereluctanttousetheintranettoaccessinformation.Therefore,theymayhave tobeconvincedaboutthebenefitsofusingthenewtechnology. Thecasestudygivenbelowwillillustratehowanintranetshouldbedesignedand usedasaneffectivecommunicationtool

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THERANDLIBRARYINTRANET
TheRandLibraryispartofanonprofitresearchinstitutionbasedinSantaMonica, California,USA,thatisinvolvedinhelpingtoimprovepolicyanddecisionmakingof federal,stateandlocalgovernmentsthroughresearchandanalysis. The RAND library intranet has been designed with the objective of being an interactive tool that helps library staff and clients communicate regularly with each other. Another objective is to constantly update the information available to its customers.ThisdoesnotrequireanITspecialistandcanbedonebyanylibrarystaff member. Theirintranetcommunicationstrategyincludesthreecomponentsanupdatedhome page, an email alert service and several email links. The home page contains the librarylogoandamenu,whicharestandardcomponents,whilethebodyofthepage ischangedatleastonceaweek.Thehomepageincludesinternetsitesthatmaybe of value to their research staff, as well as announcements regarding library news, newservicesandpolicychanges. TheemailalertserviceincludesemaildistributionlistsfortopicssuchasHealthCare, ScienceandTechnology.Oncesomeonehassignedupfortheemailalertservicefor oneofthesetopics,theyreceiveregularemailpertainingtothesetopics. Multipleemaillinksareusedtomakethecommunicationtwoway.Thismeansthat the clients can come to the intranet site and make requests for books, research articlesandsoon.TheycanalsoclickonaContactaLibrarianlinkthatbringsup thename,jobtitleandphotographofeachofthereferencelibrarians.

SelfAssessmentQuestion1 Arethefollowingstatementstrueorfalse? 1.Theintranetispartofaninformalcommunicationnetwork. 2.Theintranetcanbecustomizedtomeettheneedsofsmallercompanies. 3.Theintranetencouragesgrapevine. 4.Theintranetcanmakemeetingsmorefocused. 5.Theintranetinvolveshighinvestmentinmaintenanceandtraining.

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10.3 CommunicatingThroughEmail Althoughemailisatoolforexternalcommunication,itisalsoregularlyusedwithinanorganization, in placeoftelephoneandfacetofacecontact. This is because email is instantaneousandallows you to send messagesthatothers can pick upat their convenience.Besides, email also makesit possible to send messages to people anywhere in the world and to people who are otherwise impossibletoreach. Whiletheotherformsofwrittencommunicationarehighlyformalinnature,emailismoreinformal andspontaneous.Itisthereforeeasiertowriteanemailmessagethanitistowriteabusinessletter orareport,wheregreaterattentionhastobepaidtothelanguage,styleandtone.Sinceemailis quick, easy to use and spontaneous, it can also help to improve personal relationships in the workplace. 10.3.1 PrinciplesOfEmailCommunication The principles of communicating through email are a little different from the principles of written communication,sinceemailismoreinformalinnature.Weshalldiscusstheseinsomedetail *WatchthecontentEmailmessagesarenotalwaysconfidentialandonecanneverbesurewho willreadthem.Theminuteanemailmessageissent,multiplecopiesarecreatedonyourownPC andserverandontherecipientsPCandserver.Thereisnowayofensuringthatthemessagewill notbeforwardedtoothers.Sometimes,emailmessagescanevenbeusedasproofincourt.Oncea messageissent,apermanentrecordiscreated.Therefore,itisalwayswisetoavoidwritinganything negativeoroffensive. Itisparticularlyimportanttowatchthecontentofofficialemailmessagessentusinganemployers equipment. Since the employer has a right to read the message and is legally responsible for its content,itmustbecarefullyworded. * Pay attention to the tone The very nature of email communication can make the message sound negative, abrupt and rude. For one thing, email lacks the personal quality of facetoface communication, where body language and other nonverbal cues may be used to make the communication more positive. Secondly, email messages have to be brief, using short words,

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sentencesandlackofsalutations.Briefmessagesmaybeinterpretedasbeingrudeandunfriendly. Therefore, you must pay close attention to the tone of the message and ensure that you sound friendlyandcourteous.Avoidusinghumorandsarcasmwhichmightbemisunderstood,orsending messageswhenyouareangryorannoyed. *IncludeaspecificsubjectlineYouremailmessageshouldalwaysincludeasubjectlinethat clearlymentionsthetopicoftheemail.Sincebusinessexecutivesreceiveseveralemailsaday,this wouldhelpthemtodecidewhichmessagesaremostimportanttothem.Theywillalsohaveanidea ofwhatthemessagecontains. *PlaceimportantinformationfirstSincebusinessexecutivesdonothavetimetoreadlengthye mailmessages,itisagoodideatoputalltheimportantinformationthatyouwanttoconveyinthe firstthreelinesofthemessage.Whetheryouareseekingaclarification,makingarequest,orgiving instructions,itisbesttomentionthisrightattheoutset,sothatitisnoticed. *ExplainattachmentsinthebodyoftheemailAttachmentstaketimetodownloadandshould besentalongwithanexplanationinthebodyoftheemail,astowhattheyareallabout.Thiswill make it easier for the recipient of the message to decide whether they should be opened or not. Otherwiseitwillleadtounnecessarywasteoftime. *UsethetoandccbuttoncarefullyThetoboxshouldbeusedonlytosendmessagesto people who are responsible for doing something. The cc button is used when sending multiple copiesofthesameemailmessagetootherrecipients,whoneedtobekeptinformedonaspecific issue.Thisshouldbeusedwithcare,makingsurethatthemessageissentonlytotherightpersons. Itis importanttorespectprivacy,sincenoteveryonelikeshavingtheiremailaddressdisplayedto others. Besides, sending a long list of email addresses can interfere with the readingof the main message. *Payattentiontobrevity,emphasisandwhitespaceThelook,appearanceandlanguageused intheemailmessagecaninfluencethereadabilityofthemessage.Sometechniquesforenhancing readability of email messages include short paragraphs ( six lines maximum), spacing between

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paragraphs,useofbulletpointsandnumbersforlists,useofparagraphcaptions,highlightingmain pointsinboldtypeanduseofwhitespace. * Use the WIFM rule WIFM standsfor Whats In It For Me? and means that the benefits of your message to the reader should be emphasized. This involves use of the second person pronoun,you,ratherthanthefirstpersonpronounsIorme.Stressingontheyouattituderather thanthemeattitudewasdiscussedinanearlierunit. * Tidy up your mail box Email traffic can lead to your inbox becoming cluttered, with more messagesthanyoucanhandle.Itthenbecomesdifficulttoretrieveimportantmessageswhenyou need them. It is therefore a good idea to cleanup your mailbox regularly,by deleting unimportant messages.Theimportantmessagesthatyouwanttorefertolatershouldbeputintoseparatetopic folders.Everynowandthen,anyoutdatedmessagesinthetopicfoldersshouldalsobedeleted. * Proofread your email message Just as it is important toproofreadbusiness reports, letters andmemos,emailmessagesshouldalsobecheckedforspellingandgrammarmistakes,soasto avoidanyembarrassment. * Set aside time to check email Email should not become a substitute for facetoface interactionattheworkplace,orcutintovaluabletimespentonotherimportantjobs.Itisagoodidea todetermineatimeduringtheworkdaywhenyoucheckandrespondtoemailmessages. 10.3.2 EmailEtiquette Similartomeetingetiquettewhichwediscussedinanearlierunit,thereisanetiquetteforwritinge mailmessages,whichshouldbestrictlyfollowed 1.MindyourPsandQsTheserefertothethreemagicwords,Please,ThankYouand Sorry. They are all the more important in email messages, which have to be extra polite and friendly.

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2. Avoid shouting Shouting in an email message refers to use of all capital letters in the text. All caps make it difficult to read a message and are therefore considered to be rude, like shouting. 3. Avoid symbols and acronyms Symbolic messages using punctuation marks, known as emoticons(forexample,:)forasmileyface!)shouldbeavoided,especiallyinbusinessrelatede mail messages. Similarly, abbreviations suchas BTW ( by the way) should beavoided since they soundovercasualandmaynotbeunderstoodbyeveryone. 4. Use friendly salutations and signoffs Although these are not strictly required in email communicationasinbusinessletters,asalutationsuchasDearJohnandasignoffsuchasWarm Regards,helpstomakethetonefriendlyandpersonal. 5.RespondpromptlyInthecaseofbusinessrelatedemails,itisimportanttorespondpromptly, especiallywhencommunicatingwithsuperiors.Evenifyouarehardpressedfortime,areoutoftown oroutoftheoffice,youcansetanautomaticemailresponsetoyourreceivedmessages,whichwill mentionthatyouwillberespondingindetailonaspecificdate. 6.AvoidpersonalmessagesatworkDonotmakeuseoftheofficefacilitytosendpersonale mail messages. Since confidentiality of the message is not guaranteed, it may lead to embarrassmentlater. 7.AvoidsendingjunkmailDonotsendirrelevantmessagesormessagesthatarenotwork related,topeopleatwork.Ifyouoverloadpeoplewiththiskindofmail,theywillnotpayattentionto thereallyimportantmessages.

Emailshouldbeusedconstructivelyandjudiciously,tomeetyourgoalsattheworkplace andtoenhanceyourperformanceonthejob. Hereareafewcareertipsthatcanhelpyoutotakeadvantageofemail

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SOMEDOSOFEMAIL Useemailwhen 1.Youwishtobeapartofanetworkwhereyoucanshareinformationandreceive


informationfromothers. 2.Youwanttocontactimportantpeoplequicklyandsavetimespentinmeetings. 3. You want to send information to a large number of people located across the globe. 4.YouwanttoestablishaprofessionalimageYourlanguageandwritingstyleon electronic media can say a lot about you, just like your dress and outward appearance.Watchyourspelling,grammarandusageofEnglish. 5.Youwanttocutthroughhierarchyandspeedupteamprojects.

SelfAssessmentQuestion2 Matchthefollowing 1.WIFMprinciplea.Acronym

2.PsandQs

b.Readerbenefits

3.Shoutingc.Bulletpointsandwhitespace 4.Readabilityd.Allcapitalletters 5.FYI e.Etiquette

10.4

CommunicationWithShareholders

Shareholdersareimportantinternalstakeholdersofanorganization,sincetheyaretheownersofthe company. Since the capital required is huge, there are no proprietors and partners any more. As organizations grow, shareholding is widely scattered. Therefore, it is essential to retain the
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shareholdersconfidenceinthecompanysmanagement,througheffectivecommunicationwiththem onaregularbasis. Therearetwosituationswhenshareholdercommunicationisextremelyvital 1.Ifacompanyisdoingwellandwantstoexpanditsscopeofoperations,ordiversifyintounrelated areas. In this case, good shareholder relations canhelp to raise the required capitaland minimize borrowingfrombanksandfinancialinstitutions.

2.Ifacompanyisgoingthroughacrisisordifficulttimes,morecommunicationwithshareholdersis needed.TaketheexampleofCokeandPepsiduringthepesticidecontroversy.Insuchasituation, the company should be open with its shareholders and explain the problem clearly, including the steps being taken to overcome the crisis. Crisis communication is an important, but often overlookedarea of shareholder communication.Lackof communication during a crisisencourages thegrapevineamongshareholdersandleadstofalserumors.Forexample,rumorsmayspreadthat thecompanyisgoingtoclosedown.Ontheotherhand,ifyoutellthetruth,chancesarethatyour shareholderswillstandbyyou. Theappropriatemediaforcommunicationwithshareholdersincludebothoralandwrittenchannels. Periodic mailers should be sent to all shareholders, giving a fair and truthful representation of the companys results and progress on various fronts. In areas where there is an aggregation or concentration of shareholders, shareholder meetings and conferences should be held, making presentationsonthecompanysprogress.Whenthecompanyisgoingthroughacrisis,shareholders shouldbetakenonprojectsiteandfactoryvisits,toshowthemthemeasuresthatarebeingtakento solvetheproblem. Theoverallguidingfactorincommunicatingwithshareholdersshouldbethattheyaretheownersof thecompany.

Twoexamplesaregivenbelowoftwocompanies,CognizantandReliance,thatarewellknownfor effectiveshareholdercommunication.

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COGNIZANTSCOMMUNICATIONWITHSHAREHOLDERS

CognizantisaleadingproviderofITservices,basedinNewJersey,USA.Theyhave wonnationalacclaimintheUSfinancialmediaforbeingoneofthemostshareholder friendlycompaniesintheUS.

Inasurveywhererespondentswereaskedtoratevariouscompaniesoncriteriasuchas financialperformance,communicationwithshareholders,investorrelationsandquality ofcorporategovernance,Cognizantwasrankedthehighest. Shareholderfriendlycompaniesweredescribedbyrespondentsasthosethatareknown fortheirpolicyofopennessandhighqualityofcommunicationwiththeirshareholders.

RELIANCESCOMMUNICATIONWITHSHAREHOLDERS

InIndia,oneoutofeveryfourinvestorsisashareholderofReliance.

ThecompanyhassetupafirmofCharteredAccountantsasInternalSecurityAuditors,to auditthetransactionsandcommunicationwithshareholders. TheBoardofDirectorsofthecompanyhasalsoappointedaShareholders/Investors GrievanceCommittee,forexaminingandrespondingtoshareholderscomplaintswith regardtotransferofshares,nonreceiptofbalancesheet,declareddividends,etc.The Committeealsomakesrecommendationsonhowtoimprovetheoverallqualityof investorservices.

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SelfAssessmentQuestion3 1._________________and_________________channelsareusedtocommunicatewith shareholders. 2.Projectsiteandfactoryvisitsarepartof________________communicationwith shareholders. 3.Effectivecommunicationwithshareholdersmeansbeing________________with them.

10.5

Summary

Thisunitdealtwithtwomoreaspectsofinternalbusinesscommunicationcommunicationthrough electronicmediaandshareholdercommunication. Theelectronicmediaincludetheintranetandemail,whichispartoftheintranet.Theintranetisa website exclusive to the company, which permits employees within an organization to exchange informationindigitalform.Itisideallysuitedforlargeorganizations,organizationsthathaveapurely onlinepresence,travelingemployeesandoffsiteworkers.Alltypesofinformation,includingreports, companygoals,policiesandHRrelatedannouncementsmaybepostedontheintranet. Theprimaryadvantagesoftheintranetare Facilitatesdiscussionofpreliminaryideas,priortomeetings Enablesconstantflowofinformationthroughanofficialnetworkanddiscouragesrumors Savestimeandpaper Isbetterthanemail,whenmultipleversionsofadocumenthavetobesent

Someofthedisadvantagesoftheintranetare Isexpensivetogetstarted Needstobemaintainedandcontinuouslyupdated Requiresinvestinginemployeetrainingandconvincingoldeconomyemployeestouseit

Whencommunicatingthroughemail,thefollowingguidelinesshouldbekeptinmind Avoidsayinganythingnegativeorconfidential Makethetonefriendly Includeaspecificsubjectline Stateimportantinformationfirst Describetheattachments

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Payattentiontouseoftoandcc Maketheemailbriefandeasytoread Stressreaderbenefits Keepyourmailboxtidy Allottimeforcheckingandansweringemail

Emailetiquetteinvolvesthefollowing Remembertobepolite Avoidshouting Avoiduseofsymbolsandacronyms Includefriendlysalutationsandsignoffs Respondpromptly Respectprivacy

Shareholder communication is important, since they are the virtual owners of the company. It is important to communicate openly with them, both in good times and bad. Good relations with shareholderscanhelptoraisecapitalfornewprojectsandtoretaintheirconfidence,evenwhenthe company is going through a crisis. The media used to communicate with shareholders include mailers,meetings,conferencesandsite/factoryvisits. TerminalQuestions

1. Talktoabusinessexecutiveinacompanyandsectorofyourchoice,tofindouthowthe
intranetisbeingusedtocommunicateinternally.Whattypeofinformationisexchanged throughtheintranet?

2. Asasalesperson,writeanemailmessagetoyourSalesManager,requestingthatameetingbe
scheduledtopresentyourideasonhowtoimprovesalesforthecomingyear.

3. Gothroughbusinessmagazinesanddailynewspapersandselectasituationwhenacompany
wasfacingacrisis(e.g.,CokeandPepsipesticidecontroversy).Howdidthecompany communicatewithitsshareholdersandotherstakeholderstoovercomethecrisis?Wasthe communicationeffective?

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AnswerstoSelfAssessmentQuestions SelfAssessmentQuestions1

1. False 2. True 3. False 4. True 5. True


SelfAssessmentQuestions2

1. b 2. e 3. d 4. c 5. a
SelfAssessmentQuestions4

1. Oralwritten 2. Crisis 3. Open/truthful/transparent


AnswertoTerminalQuestions 1.Refer10.2,10.2.1 2.Refer10.3,10.3.1,10.3.2 3.Refer10.4

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