Business Communication (5409)

Associate Degree in Commerce

Spring, 2015
ASSIGNMENT No. 1
Q.1 Define business communication. Discuss the role of effective business
communication within and outside the organization in contemporary
business operations. (10+10)
Ans:
Communication is defined as The flow of material information perception, understanding and imagination
among various parties.
Business includes those organizations, which are engaged in the production and distribution
of goods and services to earn profit. Therefore Business communication means, Flow of information,
perception etc. either within a business organization or outside the organization among different parties.

EXPLANATION:We can extract the following points form the above definition;
Flow between two or more parties.
In business communication the material flow from one person to another person or from many
persons to different people. This flow may either be inside the organization or outside the organization.
(i)

(ii)

Flow of information, perception, imagination etc.

Flow of information takes place when a party transfers the material to another mind. For example,
th
when a news caster says, Pakistan has conducted nuclear test on 28 May 1998. This is a flow of information
from news caster to the listeners.
Flow of perception means transfer of different feelings. Finally, flow of imagination that occurs
when a painter conveys his/her imaginations through a portrait.
A business Organization is a group of people associated to earn profit. Various kinds of activities have to be
performed by the people of an organization so as to earn profit. These activities need an effective and
systematic communication. Without efficient communication, one can not even imagine to do work and hence
will be unable to earn profit. Since the aim of business organization is to earn profit, the organization will die
without profit and this death is a result of the absence of communication. This is why communication is
called life blood of a business organization. We can prove this statement in the following manner.

COMMUNICA TION INSIDE AN OR GANIZAT IO N:

Different employees and officials in an organization need to communicate to each other. This
internal communication with its importance is shown in the following way:

1. Setting goals and Objectives:Mostly, the organizations have a variety of formal and informal objectives to accomplish. These
objectives may be financial results, product quality, market dominance, employees satisfaction, or service to
customers. So the communication enables all the persons in an organization to work towards a common
purpose.

2. Ma king and Implementing decisio n:In order to achieve the objective, people in a business organization collect facts and evaluate
alternatives, and they do so by reading, asking questions, talking or by plain thinking. These thoughts are put
into a written form. Once a decision has been made, it has to be implemented which requires communication.

3. Appraisal:Having implemented the decision, management needs to determine whether the desired outcome
is being achieved. Statistics on such factors as cost, sales, market share, productivity and inventory levels
are compiled. This is done through computers, manual papers, memos or reports.

4. Ma nufacturing the products:Getting an idea for a new product out of someones head, pushing it through the production process
and finally getting the product also require communication. Designing the plan regarding product,
introducing the workers, purchasing raw material, marketing and distributing the product all require effective
communication.

5. Interaction between emp loyer & employee:1

Employees are informed about policies and decisions of employers through circulars, reports,
notices etc. Employers also get in touch with employees through application, complaint etc. So,
communication plays a vital role in the interaction of employer and employee.

EXTERNAL CO MMUNICA TION :

1. Hiring the employees:If a company wants to hire some one, it advertises the vacancy, receives applications, calls the
candidates, takes the interview and then offers job to the successful candidates. The whole process requires
communication.

2. Dealing with customers:Sales letters and brochures, advertisements, personal sales calls, and formal proposals are all used
to stimulate the customers interest. Communication also plays a part in such customer related functions as
credit checking, billing, and handling complaints and questions.

3. Negotiating with suppliers and financiers:To obtain necessary supplies and services, companies develop written specification that outlines
their requirement. Similarly, to arrange finance, they negotiate with lenders and fill out loan applications.

4. Informing the investors:Balance sheet, income statement, and ratio analysis are used to inform the investors regarding
performance of business.

5. Interacting with Govt.:Government agencies make certain rules to regulate the economy. These rules are
communicated to organizations through various papers. These organizations try to fulfill, these
requirement like filling taxation form and other documents.

Q.2 a)
Explain various essential elements of communication process.
Ans: Elements of Communication
Communication is one of the most important factors for the existence of our society today. The importance
of effective communication is immeasurable in the world of business and in personal life. Denis McQuail is
one of the most influential scholars in the field of mass communication studies says Communication is the
sending of meaningful messages from one person to another. According to Harold D Lasswell
Communication is discerning who says what, in which channel to whom and with what effect. In simple
words Communication is giving, receiving or exchanging ideas, information, signals or messages through an
appropriate media. It is a dynamic process involving a series of actions and reactions with a view to achieve
a goal. The importance of effective communication is immeasurable in the world of business and in personal
life. Communication is, therefore, a two way process. Each element plays an important role in making the
communication effective and can be classified as follows:
1.Sender: Sender is an individual, group, or organization who initiates the communication. This source is
initially responsible for the success of the message. A process by which the sender formulates an idea to
communicate is selected first. The first step the sender is faced with involves the encoding process. In order
to convey meaning, the sender must begin encoding, which means translating information into a message in
the form of symbols signs that represent ideas or concepts, which is then communicated. This process can be
influenced by external factors, or it can come about internally by thinking about a particular subject. For Ex:
Ex. A politician giving a speech.
A parent lecturing a child.
Customer of a restaurant writing a complaint letter to the management of the restaurant.
2. Message: A message can be an idea, concept, emotion, feeling that a person wants to share with another
person. A message can be verbal or non-verbal form of communication. It is based on the source or idea, but
the message is crafted to meet the needs of the receiver. The purpose to send a message is to evoke meaning
to the other person. A message can be intentional or non-intentional. Messages can be encoded into a variety
of formats oral, written or visual.
Eg: Speech is a channel, signs, gestures, symbols are different ways in which a message can be transmitted.
3. Channel: Its the medium through which communication is transmitted from one person to
the reliever. Most channels are either oral or written. Common channels include the telephone and a variety
of written forms such as memos, letters, and reports. The effectiveness of the various channels fluctuates
depending on the characteristics of the communication. In case of immediate feedback Oral Communication
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is convenient. In a situation where the message must be delivered to more than a small group of people,
written channels are often more effective. Although in many cases, both oral and written channels should be
used because one supplements the other. For Eg: A president delivering a Speech may speak face to face
with an audience, via the broadcast media or via print.
For Ex : An audience receives the politicians speech.
The child who is the recipient of the parents lecture
4. Receiver: Receiver is the individual or individuals to whom the message is directed to. The extent to
which a receiver comprehends the message will depend on a number of factors, which include the following:
knowledge of the individual regarding the message, their receptivity to the message. All interpretations by
the receiver are influenced by their experiences, attitudes, knowledge, skills, perceptions, and culture.
Ex. An audience receives the politicians speech.
Student receiving a lecture from the teacher in a classroom.
5. Decoding: Decoding is the process where the message is interpreted by the receiver . The receiver begins
to interpret the message through words, signs, symbols sent by the sender translating the message to its set
of experiences in order to make the message meaningful. Successful communication takes place when the
receiver correctly interprets the senders message.
Eg: A student searches the definition of a word unknown to her in the dictionary, interprets the meaning and
gains information.
6. Feedback: Feedback is an integral part of communication process that allows the speaker to monitor the
process and to evaluate the success of the message communicated. This step conveys to the sender that the
message is understood by the receiver. After receiving a message, the receiver responds through a channel
and signals that response to the sender. For Ex: The signal may take the form of a spoken comment, a
written message, a smile, rolling of eyes, a sigh or some other action. No response is also a form of
feedback. Without feedback, the sender cannot confirm that the receiver has interpreted the message
correctly. For Eg: Employee surveys, company news letters, e-mails.
7. Noise- There are certain barriers present in the communication process. These factors may have an
impact on the communication process. Noise is one of the most common barriers, that influence the
feedback in this process. Noise essentially is anything that distorts a message by interfering with the
communication process. Noise can take many forms it can be external or internal factors. Noise as a barrier
may originate from the source or the receiver, from the channel used in sending the message, or outside the
source and receivers control.
Eg: Internal factor Involves mental forces within a receiver or sender that might affect his or her ability to
either encode or decode a message correctly. Eg: Daydreaming, fatigue, exhaustion.
Eg: External factors: Anything around the person that disturbs the communication process. Eg: Sights,
sounds, smell.
Conclusion:
Successful and effective communication for an individual, group or an organization starts with the right
implementation of the communication process. Effective communication leads to understanding. Through
this process that the sharing of a common meaning between the sender and the receiver takes
place. Communication is important for us. For effective communication we need to understand how various
elements work.
b)
Explain the need and importance of communication for an organization.
Ans:
Effective Communication is significant for managers in the organizations so as to perform the basic
functions of management, i.e., Planning, Organizing, Leading and Controlling.
Communication helps managers to perform their jobs and responsibilities. Communication serves as
a foundation for planning. All the essential information must be communicated to the managers who in-turn
must communicate the plans so as to implement them. Organizing also requires effective communication
with others about their job task. Similarly leaders as managers must communicate effectively with their
subordinates so as to achieve the team goals. Controlling is not possible without written and oral
communication.
Managers devote a great part of their time in communication. They generally devote approximately 6
hours per day in communicating. They spend great time on face to face or telephonic communication with
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their superiors, subordinates, colleagues, customers or suppliers. Managers also use Written Communication
in form of letters, reports or memos wherever oral communication is not feasible.
Thus, we can say that effective communication is a building block of successful organizations. In other
words, communication acts as organizational blood.
The importance of communication in an organization can be summarized as follows:
1.
Promotes motivation:
Communication promotes motivation by informing and clarifying the
employees about the task to be done, the manner they are performing the task, and how to improve their
performance if it is not up to the mark.
2.
Source of information:
Communication is a source of information to the organizational
members for decision-making process as it helps identifying and assessing alternative course of actions.
3.
Altering individuals attitudes:
Communication also plays a crucial role in altering individuals
attitudes, i.e., a well informed individual will have better attitude than a less-informed individual.
Organizational magazines, journals, meetings and various other forms of oral and written communication
help in molding employees attitudes.
4.
Helps in socializing: Communication also helps in socializing. In todays life the only presence of
another individual fosters communication. It is also said that one cannot survive without communication.
5.
Controlling process: Communication also assists in controlling process. It helps controlling
organizational members behaviour in various ways. There are various levels of hierarchy and certain
principles and guidelines that employees must follow in an organization. They must comply with
organizational policies, perform their job role efficiently and communicate any work problem and grievance
to their superiors. Thus, communication helps in controlling function of management.
An effective and efficient communication system requires managerial proficiency in delivering and
receiving messages. A manager must discover various barriers to communication, analyze the reasons for
their occurrence and take preventive steps to avoid those barriers. Thus, the primary responsibility of a
manager is to develop and maintain an effective communication system in the organization.
Q.3:
Explain encoding and decoding of a message in interpersonal
communication. Discuss different types of barriers which hinder an effective
communication process. (10+10)
Q.4 a)
Differentiate between internal communication and external
communication.(10)
b)
Differentiate between verbal communication and non-verbal
communication.(10)

Ans:
VERBAL COMMUNICATION: Verbal communication means such a communication that takes
place by means of a language or words. It includes the following contents.
a.
Oral communicatio n (Speaking & listening)
b.
Written communication (writing & rea ding)

1. Speaking:In order to send message in business, speaking plays a vital role. Giving instruction,
conducting interviews, attending meetings, sending orders through telephone calls are very common in todays
business.

2. Writing:It is used when a complex message is sent. Placing order through letters, informing
employees through circulars, sending reports and memos, filling different government forms, keeping records
in writing are some examples of this aspect of verbal communication.

3. Listening :People in business spend more time in obtaining information then transmitting it. Listening is the
most important way to receive information: information regarding order of employers, instruction, rules
and regulation, customer trend etc, are obtained through listening. But in listening, people generally forget
75% of the message after few days.

4. Reading:Reading reports, memos, policies, circulars, and different business statements are essential for an

organization: Reading involves understanding and interpreting the material.

NON VERBAL COMMUNICATION:
It means communication without the use of language or words.
It includes appearance, body language, silence, etc. Its explanation is as follows;

1. Facial Expressions:Face and eyes are helpful means of nonverbal communication. They reveal hidden emotions
such as anger, confusion, enthusiasm, fear, joy etc.

2. Gestures, postu res & mo vement:Postures means the language primarily composed of hand and fingers. Communication of deaf
people and signal given by traffic constable are the example of posture. Gestures and body movement
also indicate many things. Shaking hand with firmness indicates a warm relationship, moving back and
forth reveals nervousness.

Q.5 Define management information system. Describe various users of information

within and outside the organization.
(20)