Scott and Sprige underline the importance of communication in an organisation by saying that “Communication is the process involving the transmission and accurate replication of ideas reinforced by feedback purporting to stimulate actions to accomplish organisational goals.” 

Importance of Communication 

1. Helps in achieving co-ordination: Modern business firms, which are organized on a large scale, consist of workers working on the basis of divisions of labour and specializations. To attain the goals of the business unit, there is need for co-ordination among workers and this is need for coordination among workers and this can be achieved only through communication. 

2. Helps in smooth working: To achieve the goals of an enterprise, co-operative action of the persons working in its different activities is necessary. Co-operative action in turn depends on the communication process prevailing in the organization. 

3. Increased managerial efficiency: It is said most of the manager’s time is spent on communication. This helps the manager in performing his duties quickly and systematically. 


4. Helps in decision making: For taking any sort of decisions and also for its effective implementation a good communication system in the enterprise is a primary requirement. Information from different levels, which helps the process of decision making, is received through the system of communication. 

5. Helps in maintaining industrial peace: Lack of communication or improper communication may result in industrial disputes between management and workers. Communication helps in maintaining industrial peace. 

6. Helps in recruitment process: Communication is needed in the recruitment process to acquaint potential employees with the merits of working for the enterprise. The recruits are told about the company organization structure, its policies and practices. 

7. Helps employees to perform effectively: Employees are required to know their job relationship and importance to the overall operation. This knowledge makes it easy for them to identify themselves with the organization mission. 


8. Helps to acquaint subordinates with their evaluation: It is needed to acquaint the subordinates with the evaluation of their contribution to enterprise activity. It is a matter of some motivational importance for the subordinates to know their superior how they are and what the future may hold for them. 

9. Helps in teaching employees about personal safety: Communication is needed to teach employees about their personal safety on the job, to reduce accidents, to lower compensation, to maximize legal costs and to reduce recruitment and training costs for replacement. 

10. Helps in manger performing his functions: It helps the manager in performing his managerial functions such as planning, organizing, staffing, directing and controlling. Planning requires detailed communication among the managerial and other personnel.

11. Helps in Efficient working of the business: Communication is essential for successful and smooth running of an enterprise. It is through communication that a healthy and conducive environment is created, organisational goals and policies are conveyed to the employees and various resources necessary for their accomplishment are coordinated. 


Had the communication not been effective, there would have been no environment of understanding, most essential for the working of the organization. 

12. Basis of managerial functions: Communication proceeds and permeates through every managerial function so much as George R. Terry remarks that it, “serves as a lubricant for fostering the smooth operations of the management process.” Communication is helpful to the management in discharging various functions, which are as follows: 

(a) Anticipation: The most important function of the management is to anticipate the future of their products and prospects in the light of the social, economic and political environment of various countries and regions. They have to keep in touch with the social, political and economic environment and also anticipate their future trends and their impact on the company. 

(b) Innovations: In the era of rapid advancements in technology and accelerating rate of obsolescence, the organizations have to continuously learn and innovate. For this, they have to link themselves with institutes and universities of advanced learning and share the acquired knowledge with the employees of the organisation. For acquiring and spreading information and knowledge, communication is essential. 

(c) Planning: Framing of various plans, policies, programmes and procedures require thorough communication among employees and various executives. Again when their purpose and philosophy is conveyed, communication comes into operation. 

(d) Organising: Organisation is concerned with deciding the necessary activities of business, dividing it into various departments and delegating authorities to perform them. 

For every activity of the organization, communication is needed. For example-knowing about the availability of various resources, powers and jurisdiction of various persons etc., we need information through various channels. 

(e) Leading, Directing and Motivating: The process of leading, directing and motivating requires communication. To quote Peter Senge “The essence of leadership—what we do with, 98 percent of our time, is communication.” As a leader, the manager has to influence the behaviour of his or her subordinates so that they willingly accept him/her as their leader. 

Unless effective communication is there, he or she cannot influence and inspire them. He or she has to create an environment of trust, understanding and co-operation through communication. 


For the execution of the work, he or she has to issue necessary instructions, orders and invite suggestions and opinions of the workers. Again, communication is involved in this directing function of management.

 When he or she feels that there is a friction or frustration among employees he/she has to remove it through proper and timely communication. He/she has to understand the needs and interests of the employees and motivate them by making their goals congruent to the organizational goals. 

(f) Controlling: Communication facilitates in controlling and channelising various activities of the individuals, departments and segments of the organization. In this process, the actual performance is to be compared with the expected and corrective actions taken when actual performance is compared, there is feedback from the employees regarding their progress and when corrective actions are taken, they are communicated to them either orally or in writing by their superiors. 

13. Building Human Relations: Healthy industrial relations are conducive to industrial peace and prosperity. This is possible not only with good working conditions and environment but also with communication among the management and workers. Through effective communication the management can convey its expectations to workers and workers can put their suggestions and grievances before the management. 


Thus the two-way communication promotes co-operation and understanding among management and workers. To quote William Onchen III, “Communication is the chain of understanding that integrates an organization from top to bottom, from bottom to top, and from side to side.” 

14.  Total quality Management (TQM): Communication is especially essential in Total Quality Organizations because of involvement of various departments and specialists with varied experiences and assumptions.

 In a Total Quality Organization with cross functional teams “Until consensus is reached between the executives and employees about how to go in for achieving quality, there will be a great deal of wasted efforts or no effort at all,” Michael J. Stahl quotes. As Total Quality strategy involves continuous change, organizational members must be informed about the change lest chaos results. 

15.  Zero-defect Marketing and Quality Services: Present day market aims at zero-defect marketing and emphasizes quality services to the customers. To provide zero-defect product and quality service, it requires proper and healthy communication of the company with customers. 


If dealers and sales employees, through whom the company communicates, patiently listen to the responses and expectations of customers, the sales increase and production can be adapted accordingly. Can a businessman afford to lose present day money-rich and time-poor customers, because of communication failures? Certainly not! 

16. Job satisfaction and Enrichment: Bad communications result in illusions and misunderstanding among employees and executives. As a result their behaviour becomes defensive and consequently leads to low morale, low job satisfaction and low productivity. 

Effective communication overcomes illusion and misunderstanding among people at work. It contributes to greater co-operation among them, enhances their morale and job satisfaction and provides enrichment to their quality of life. 

17.  Maintaining relations with external parties:  communication is not only essential for uninterrupted working of any enterprise, but also for maintaining good relations with external parties such as customers, creditors, trade unions, research institutions, etc. In the present era of globalisation and advanced information technology, communication is imperative and indispensable.

 The words of Tom Peters clearly highlight, “Organisations that are engaged by electronic bulletin board with outside organisations to which they are just slightly related,….. that are looked into universities and other learning centres, they alone will thrive.” 

18. Strategic Management: Strategic Management consists of decisions and actions directed at formulation and implementation of strategies (courses of actions with allocation of necessary resources meant to outperform the competitor). In the modern era of Industrial Darwinism, with innovation as the key to survive and thrive in competition, top management’s role has been redefined to set broad mission and bottom level management’s role has increased in formulation and implementation of strategies.


It requires flawless and free communication among top level and bottom level management to understand each other’s plans and actions and to know the objectives of the organization in the light of which bottom level managers formulate strategies and communicate it to top management. 

The above points illuminate that communication is vital for survival and growth of any organization. Herbert G. Hicks adds to it, “Communication is basic to an organization’s existence from birth of the organization on through its continuing life; when communication stops organized activity ceases to exist.” Therefore “The first executing function” Chester I. Bernard emphasises, “is to develop and maintain a system of communication.”  

Importance of Non-Verbal Communication

Although non-verbal communication is often unplanned, it has more impact than verbal communication. Non-verbal cues are especially important in conveying feelings, accounting for 93 percent of the emotional meaning that is exchanged in any interaction.

(1) Reliability – One advantage of non-verbal communication is its reliability. Words are relatively easy to control; body language, facial expressions and vocal characteristics are not.

(2) Efficient – Non-verbal communication is important for another reason as well. It can be efficient from both the sender’s and the receiver’s standpoint. 

You can transmit a non-verbal message without even thinking about it and your audience can register the meaning unconsciously. Making use of words involves much effort on your part. A wave of the hand, a pat on the back, a wink—all are streamlined expressions of thought.

Importance of Communication in Modern Times

1. Internal Communication 


Effective internal communication is considered important for the following reasons: 

(i) Effective Communication Promotes a Spirit of Understanding and Co-operation: If there exists effective communication between the management and the employees, it helps to bring about an atmosphere of mutual trust and confidence. 

The employees know exactly what is expected of them; the management is aware of the potentialities and limitations of the employees and knows how to exploit the former and make up for the latter. 

This mutual understanding is extremely beneficial to both the parties. The management gets better returns; the employees get job satisfaction. They also develop a sense of belonging and loyalty to the enterprise. 

(a) Internal communication is communication within the organisation. 


(b) It is important because: 

(i) business grows in size, and in complexity; 

(ii) it promotes understanding and co-operation among members. 

This calls for an effective and efficient network of communication. 

(ii) Business has Grown in Size: Large business houses have a number of branches within the country and even abroad. Some of the multinational corporations are no smaller than huge empires. The central organisation of a large business house is its nerve centre. 

For its healthy and even growth, it is extremely important that the central organisation maintains a thorough and up-to-date knowledge of the various activities at the branch offices, keeps the branch offices well acquainted with the activities at the centre, and some kind of link is maintained among the various branches. 


(iii) Business Activity has become Extremely Complex: This being an age of specialisation, the various functions like planning, production, sales, stores, advertising, financing, accounts, welfare, etc., are handled by different departments. If these departments do not communicate with one another as well as with the management, there will be no coordination among them. 

This may give rise to some awkwardness and embarrassing situations for the management. When production is fully geared up, the stores department may report shortage or non-availability of raw materials. The planners, having spent a full month to work out the details of a new project, may suddenly discover that there are no finances available to execute the project. 

2. External Communication 

External communication includes communication with the government agencies and departments on the one hand and distributors, retailers, individual customers and the general public on the other. 

(i) Government Agencies and Departments: Business organisations are required to deal with licensing authorities, foreign trade offices, customs authorities, banks and other financial institutions, income-tax and sales-tax offices, post offices, transporters, etc. Quite frequently they find themselves in formidable and tricky situations that can be handled only through tactful negotiation and negotiation is nothing but communication. 

(ii) Distributors, Retailers, Individual Customers, etc: Modern business is a highly competitive phenomenon. Each product of common consumption is available in myriads of brands, not all of which sell equally well. Marketing research has revealed that the organisations that can communicate better, can also sell better. Sales are promoted through persuasion and persuasion is another aspect of communication.

Importance of Communication in Business

With the passage of time, society has also become increasingly complex and business more global, making communication a very integral part in the success of any organisation. The factors responsible for growing importance of communication are:

1. Large Size Organisations: 

For every organisation’s success, it is important for those holding the top influential positions to actively seek awareness into what is happening in the ranks. This is possible only if the communication within the organisation is effective. In a business setting, this effort can prove to be crucial in terms of survival. 

It is important for managers, supervisors and those who are in an official capacity to know the things that affect workforce performance in order to determine what needs to be changed or maintained. However, in a more essential sense, the objective is to create a culture of profitability and growth within the business organization that practises it. 

2. Human Relations: 

It is not possible to have human relations without communication. Effective communication of information and decision is an essential component for management-employee relations. The manager cannot get the work done from employees unless they are communicated effectively of what needs to be done. 

Chances of misunderstanding and misrepresentation lead to low morale of workers which can be minimized with a proper communication system. Hence, communication is the basic tool for motivation, which can improve the morale of the employees in an organization. 

3. Public Relations: 

Public Relations is fundamentally the art and science of establishing relationships between an organization and its key audiences and plays a key role in helping business industries create strong relationships with customers. It is the responsibility of a business house to keep shareholders, customers, employees and the society at large well informed. 

4. Communication within Teams:

Along with flatter chains of command, companies are also expanding team-based operations to increase employee involvement in decision making and to improve communication. 

When companies form cross-functional teams, individuals must work together and share information. Working relationships can become strained when individuals don’t share the same background, knowledge, or training. 

Some companies hire communication coaches to help existing teams get along. They work to develop interpersonal, negotiation, and collaboration techniques. That’s the reason why companies prefer to hire new workers who already possess these skills. 

Importance of Effective Communication

1.  Getting Jobs You Want: 

Effective communication will make it possible for you to design a powerful resume, compose a persuasive application letter, interview with poise and confidence, and get the job you want. 

2. Gaining Promotions: 

Moving ahead in your career depends on communicating your technical competencies to others and maintaining effective relationships with them. 

3. Leadership: 

Your ability to motivate and help others achieve rests on your understanding of human nature and mastering communication skills.

4. Being Productive on the Job: 

Work Performance is enhanced by your ability to listen effectively, speak clearly, and write competently. 

5. Relating Positively to Others: 

Successful business and personal relationships depend on mutual trust and respect and communicating ethically, with concern and compassion. 

6. Assuring the Success of Your Organization: 

Your organization will succeed only if it has the support of its constituencies – support that comes from effectively communicating with customers or clients about the organization’s products and services.

7. Growth of Trade Unions: 

Trade Unions are organizations whose membership consists of workers and union leaders, whose principal purposes are to negotiate wages and working conditions, regulate relations between workers and the employer, etc. Good communication plays a vital role in maintaining mutual understanding between the management and the unions. 

8. Consumerism: 

In this era of globalization, the marketplace has become extremely competitive. The companies are under constant pressure to attract clientele and to perform. Hence, marketing communication has grown tremendously to persuade the customer to buy. 

9. Coordination, Cooperation & Efficiency: 

Communication facilitates cooperation among people and coordination among different groups. Free and effective communication leads to respect and trust between management and the employees and they are able to work together in harmony and achieve the desired goals. 

10. Effective Decision Making:

Efficient communication system in an organization provides quick information, facts, figures and immediate feedback which are essential for making good decisions. 

11. Effective Leadership: 

Effective communication has a tremendous power to influence which is useful persuading in negotiating and leading. Communication helps in showcasing proficiency and competency which enables one to earn respect to lead. Hence, a good leader must possess great communication skills to motivate and direct employees and followers. 

12. Promotes Trust: 

Good business communication fosters a congenial work environment. Employees are more loyal to organizations which are transparent and trust them by giving authority and responsibility. Even external agencies trust and prefer to deal with organizations that are transparent and accessible. 

13. Increase in Productivity: 

With effective communication, one can maintain good human relations in the organization and by encouraging ideas or suggestions from employees or workers and implementing them whenever possible, one can also increase production at low cost. 

Also, with a smooth network of communication time spent on handling disputes, seeking clarifications, managing conflicts is reduced which ultimately results in efficiency and increased input. 

Importance of Feedback in Communication

Feedback is the audience’s response; it enables them to evaluate the effectiveness of a message. If the audience doesn’t understand what it means, it can be told by the response and then refine the message accordingly. Feedback is essential in communication so as to know whether the recipient has understood the message in the same terms as intended by the sender and whether he agrees to that message or not. 

There are a lot of ways in which a company takes feedback from their employees, such as – Employee surveys, memos, email, open-door policies, company newsletter etc. Employees are not always willing to provide feedback. The organization has to work a lot to get accurate feedback. 

The managers encourage feedback by asking specific questions, allowing their employees to express general views, etc. The organization should be receptive to their employee’s feedback. Employees who are given the opportunity to provide feedback feel appreciated, important and understood. 

Feedback skills

(i) Focus on a particular behavior: It should be specific rather than being general. 

(ii) Impersonal: Feedback should be job related, the manager should not criticize anyone personally. 

(iii) Goal Oriented: If we have something negative to say about the person, we should always direct it to the recipient’s goal. 

(iv) Well Timed: Feedback is most effective when there is a short gap between the recipients’ behaviour and the receipt of that feedback. 

(v) Ensure Understanding: For feedback to be effective, the manager should make sure that the recipient understands the feedback properly. 

(vi) While giving negative feedback to the recipient, the manager should not mention the factors which are not in control of the recipient. 

Communication is essential in business. Poor communication and lack of feedback can lead to frustrated customers, unmotivated employees and a negative corporate culture. Everyone communicates, but not everyone communicates effectively. 

Effective communication needs to be practiced, critiqued and assessed in order for growth. In business, effective communication often leads to an effective bottom line. 

With a lack of feedback, the corporate culture can become bleak and unmotivated. Every business has a particular culture which can be the result of the communication systems set in place. Feedback allows both customers and employees to voice their opinion, creating a healthy corporate environment which leads to greater productivity and motivation. 

Importance of Communication in workplace

Communication is the nerve center of business today. As you go up the corporate ladder, you will find that communication skills are required more than technical skills. Communication research has revealed that among the factors most important for managerial success, communication skills rank above technical skills. 

Several surveys conducted among people who have been successful in their professions have indicated that communication skills are more vital for a successful career than subjects and professional skills learnt in college. 

Communication has assumed even greater importance today, since the new model of business is based on teamwork, rather than individual action. Teamwork requires greater coordination and communication. 

Communication is also required in this age of information and technology. Without communication and human skills, technology will be of no use to an organisation as communication is needed to make sense of technology and to manage all the information. For example, communication is required to explain a new computer program or software. While computers can perform routine tasks, jobs like responding to customers’ needs require a high degree of communication skills. 

Importance of Communication in an Organisation

Scott and Sprige underline the importance of communication in an organisation by saying that “Communication is the process involving the transmission and accurate replication of ideas reinforced by feedback purporting to stimulate actions to accomplish organisational goals.” 

The importance of communication in an organization can be summarized as:

  1. 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. Communication is a source of information to the organizational members for decision-making as it helps identify and assess alternative courses of actions.
  3. Communication also plays a crucial role in altering individual’s 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 moulding employee’s attitudes.
  4. Communication also helps in socializing. In today’s life the only presence of another individual fosters communication. It is also said that one cannot survive without communication.
  5. Communication also assists in controlling processes. It helps control organizational member’s behavior 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 the function of management.
  6. 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.
  7. Communication is essential for the development of the individual, organisation, society, and the country. 
  8. Raises awareness at all levels. Business communication meets the information needs of the organisation. Motivates the people in the organisation to work towards a purpose. 
  9. Good communication is essential for proper planning and coordination of all organisational activities. It helps the administration in maintaining proper work flow, arriving at quick and well-informed decisions and in implementing them. 
  10. Good all-round communication helps in effective team building and better job performance. Without communication skills, it is not possible to maintain good human relations. 
  11. A Manager’s/ Executive’s success depends on his ability to understand the needs and requirements of his superiors, subordinates and customers and use this knowledge effectively. 
  12. Effective and timely communication promotes cordial relations and work culture and creates a healthy and happy environment within the organisation and its contacts outside. 

Importance of Good Communication

Communication is simply a method of sending a message from one person or group of persons to another. 

It is of vital importance to a business because it involves all the persons and organizations connected with the business—employees, customers, shareholders, suppliers, creditors, debtors—and a whole range of people outside—journalists, television reporters, tax authorities, local government and national government officials, the European Union and, indeed, any person or organization throughout the world with which the business has any contact.

Good communication will ensure that all these persons and organizations understand the message sent. They will also be more likely to respond favourably to the message if it appears to be reasonable and fair to both the receiver and the business.

Bad communication will have exactly the opposite effect. People will be confused by the message and less likely to do what the business wants.

That is why good communication is so essential. It is not only what you say (or write), but how you say it that is important. Your message should be easy to understand and take account of the receivers’ own attitudes and feelings.

1. One-Way and Two-Way Messages:

Communication may be one-way, when no reply is wanted or expected. For example, a public notice stating ‘TURN OFF LIGHTS’ is a command or an order which does not demand a response. However, if people do not like the message, they may respond by writing rude words on it! Most communications are two way, with some feedback, or response, required from the receiver.

If some official response was wanted to the message about turning off lights, a different means of communication would have to be used. Instead of putting up a notice, a memorandum, or a brief written message on a form, would have to be sent to the heads of all departments asking them to ensure that all lights should be turned off when not in use.

The sender could ask for the message to be acknowledged or for the heads of departments to report what action they were taking to put the order into effect. If the sender wanted to make the message more persuasive, a reason for the request could be given, which might be the need to reduce costs.

2. Directions of Communication:

Within any organization, the character of the communication varies according to whether it is going downwards, upwards or sideways.

The main uses of vertical downwards communications are:

a. To give orders or instructions;

b. To provide, or ask for, information.

Example – a manager communicating with an employee.

The main uses of vertical upwards communications are:

a. To describe the results of actions;

b. To provide information that has been requested;

c. To make requests or appeals.

Example: an employee communicating with a manager.

The main uses of horizontal, or sideways, communication are:

a. To keep equals informed of actions taken, or results achieved;

b. To discuss means of tackling problems together.

Example: colleagues communicating with colleagues.

3. Channels of Communication:

There are three main channels of communication.

They are:

a. Spoken

b. Written

c. Electronic

Visual aids, such as charts, graphs, diagrams, photographs and other illustrations, are often used to support messages. They summarize information and present it in a striking way.

4. Why Communications Fail:

There are a number of reasons why communications fail.

The cause may be the fault of:

a. The sender

b. The receiver

c. The choice of channel

a. The sender – Sometimes the sender is to blame. The message may not be clear and accurate or simple enough to be understood by the receiver. It may be so badly presented, or so boring, or so complicated, that it fails to hold the receiver’s attention.

b. The receiver – Receivers can also cause problems. They may be unwilling to take in the message because they are too busy, or because they have made up their mind already, or because they are too prejudiced to hear the message clearly.

c. The channel – The choice of channel may also be the cause. For example, it would be no good trying to discuss a very complex contract with a colleague unless he or she had been given a written copy of the contract—preferably well in advance of the meeting. The written channel is more suitable for complicated matters than the spoken channel.