Why Communication is Important (Cambridge International IGCSE Business)

The importance of communication

• Communication is the successful transfer of messages between sender(s) and receiver(s)

The communication process

A sender passes the information to the receiver using a medium of communication such as email

• Effective communication should be

  • Clear and unambiguous
  • Appropriate to the context and to the sender
  • Sent to the correct receiver in an accessible format
  • Timely and contain only the required amount of detail

• Managers should make sure that communication is organised and controlled to ensure that a suitable level of communication exists between key stakeholders

  • A 2021 survey of US workers found that more than one-third reported email overload that might lead them to resign from their jobs

Benefits of effective communication

• Helps managers and employees to minimise mistakes
• Supports everyone involved in a business to understand their role and know what is expected of them
• Ensures that the business's values and objectives are clear
• Provides customers with the information they need to understand goods and services
• Minimises business costs
• Helps businesses to effectively exploit new opportunities

Methods of communication

Spec point — "methods of communication, e.g. meetings (face-to-face or virtual), email, text messages, social media, phone calls (including mobile calls), letters, posters and noticeboards advantages and disadvantages of different methods of communication"

Methods of communication

• Businesses have a range of ways to organise communication, both within the organisation and with external stakeholders

Methods of communication include meetings, text messages and phone calls

1. Meetings

• Meetings are discussions that take place either in person or through video calls

• They are useful when detailed conversations are needed or when team collaboration is important

  • For example, a manager might hold a virtual meeting with department heads to plan for a product launch

Advantages and disadvantages of meetings

2. Email

• Emails are written messages sent electronically over the internet to one or more people

• They are useful for sharing documents, giving instructions or contacting external stakeholders like suppliers or customers

  • For example, a sales manager may email a customer with an invoice and delivery confirmation

Advantages and disadvantages of email

3. Text messages

• Text messages are short, written communications sent by mobile phone

• They are useful for urgent reminders or updates where a quick response is needed

  • For example, a supervisor might text an employee to remind them about a last-minute shift change

Advantages and disadvantages of text messages

4. Social media

• Social media platforms like Facebook, Instagram, and X allow businesses to communicate with the public or with specific groups

• They are useful for marketing, brand updates, and responding to customer questions and feedback

  • For example, a clothing brand might post product updates and special offers on Instagram to attract customers

Advantages and disadvantages of social media

5. Phone calls

• Phone calls allow two or more people to speak directly using a landline or mobile phone

• They are useful for quick decision-making or when immediate clarification is needed

  • For example, a supplier may call the purchasing manager to confirm an urgent order

Advantages and disadvantages of phone calls

6. Letters

• Letters are written documents usually printed and delivered by post or hand

• They are used for formal communication or when a permanent, signed record is needed

  • For example, a company may send a job offer or contract to a new employee by letter

Advantages and disadvantages of letters

7. Posters

• Posters are printed signs or notices placed in visible areas such as staff rooms, canteens or shop floors

• They are best for sharing key messages that need to be seen often, like health and safety reminders

  • For example, a poster in a factory might remind workers to wear safety goggles

Advantages and disadvantages of posters

8. Noticeboards

• Noticeboards are boards found in workplaces where printed messages, rotas or announcements can be pinned up

• They are useful for displaying long-term or regularly updated information such as shift timetables or company news

  • For example, a restaurant might use a noticeboard to show the weekly staff schedule

Advantages and disadvantages of noticeboards

Internal and external communication

• Internal communication is the exchange of message(s) between two or more members of the same organisation

  • For example, telephone call between a sales manager and a finance team member

• External communication is the exchange of message(s) between an organisation and external stakeholders such as customers, suppliers or investors

  • For example, sending an online order form to a supplier

Recommending communication methods

Spec point — recommend and justify which method of communication to use in a given situation

• Businesses are likely to develop their communication methods and style over time

  • Smaller business may only be able to afford to communicate with customers through posters, leaflets and social media
  • Larger businesses are likely to have greater budgets, which allow for the use of television and billboard promotional campaigns

Factors that influence the choice of communication method

Case Study Communicating Effectively at Fresh Bite Foods

Fresh Bite Foods is a Canadian healthy snack manufacturer with around 100 employees. The business sells its products through retailers and its own online store.

Communication problems

• Fresh Bite used to rely on noticeboards to share updates like shift changes and health and safety rules
• However, many employees missed important messages
• Additionally, customer complaints and questions were handled only by email, which led to delays and frustration

Solutions

• The business introduced email and a staff messaging app to send updates directly to employees’ phones
• For urgent issues like machinery problems, managers use face-to-face conversations or phone calls
• This helped reduce lateness and confusion on the shop floor
• Fresh Bite also added a live chat feature on its website and trained customer service staff to respond quickly and clearly
• This made it easier for customers to ask questions and get fast support
• As a result, customer satisfaction and reviews improved

Exam Hint Don’t just say “communication is important” – show the consequences of poor communication, such as mistakes, delays, or demotivated employees. Examiners look for this cause-and-effect link