The word communication comes from the Latin term communis, which means “common.” In simple terms, communication is the process of making ideas, thoughts, or information common between people.
This exchange can happen through speech, writing, gestures, or signals. Whether people are talking face-to-face, speaking on the phone, or exchanging emails, they are engaging in communication.
In the business world, this process becomes more structured and purposeful, as it directly supports operations, decision-making, and relationships.
Definition of Communication
Communication has been defined in various ways by experts.
George Terry describes it as the exchange of facts, ideas, opinions, or emotions between two or more people.
Rudolph F. Verderber defines it as the process of creating or sharing meaning in conversation, group interaction, or public settings.
Similarly, Keith Davis explains communication as the process of passing information and understanding from one person to another, calling it a “bridge of meaning” that helps people avoid misunderstanding.
From these definitions, communication can be understood as a two-way process of sending and receiving information with shared understanding.
What is Business Communication
Business communication refers to the exchange of information related to business activities.
It takes place between individuals, departments, organizations, or external stakeholders involved in trade and commerce. The purpose is to ensure that all parties clearly understand each other and can work toward common objectives.
In any business transaction, buyers and sellers have different interests. To align those interests and reach agreements, they must communicate effectively. This continuous exchange of messages—from initial inquiry to final agreement—is what defines business communication.
Forms of Business Communication
Business communication generally occurs in two main forms: internal communication and external communication. Both are essential for the smooth functioning of an organization.
1. Internal Communication
Internal communication takes place within an organization. It involves the exchange of information among employees, managers, and departments.
This form of communication is essential for planning, decision-making, coordination, and execution of tasks. Without effective internal communication, even well-structured organizations can struggle to function efficiently.
Internal communication flows in multiple directions depending on the organizational structure.
Downward Communication
Downward communication flows from top management to lower-level employees.
It is used to convey instructions, policies, decisions, and expectations. This type of communication ensures that employees understand what is required of them and how tasks should be performed.
It can be delivered through meetings, memos, emails, or direct instructions.
Upward Communication
Upward communication flows from employees to management.
Through this channel, employees share feedback, reports, suggestions, and concerns. It helps management stay informed about operational issues, employee satisfaction, and workplace challenges.
Effective upward communication builds trust and supports better decision-making.
Horizontal Communication
Horizontal communication occurs between individuals or departments at the same level within the organization.
Its main purpose is coordination and collaboration. By sharing ideas, information, and plans, departments can work together more efficiently.
This type of communication is especially important for teamwork and problem-solving.
Diagonal Communication
Diagonal communication takes place between individuals at different levels and across different departments.
Unlike traditional vertical or horizontal communication, it allows direct interaction between employees who may not follow the same chain of command.
This form improves speed, flexibility, and coordination in complex organizations.
2. External Communication
External communication takes place between the organization and people outside it.
This includes communication with customers, suppliers, investors, competitors, and other stakeholders. It is essential for conducting business transactions, building relationships, and maintaining the organization’s image.
No organization operates in isolation. Businesses depend on external parties for buying, selling, partnerships, and growth. Therefore, effective external communication ensures smooth interaction with the outside world.
Conclusion
Business communication is the backbone of all business activities. It connects individuals, departments, and organizations, enabling them to work toward shared goals.
Through internal communication, organizations ensure coordination and efficiency within. Through external communication, they build relationships and carry out transactions with the outside world.
In a competitive business environment, clear and effective communication is not optional—it is a critical factor for success.
See Also: The 7Cs of Communication with Examples
