Internal and external communication in business


Various schools of thought about business communications exist in society. Some say that it is identifying opportunities and exploiting them whilst others claim that it is about the connections or recruiting the best people and prepare them for the business world. No doubt that all these elements are essential. However, in my opinion as an experienced business executive, effective communication is one of the major elements that outdo many others in the success of an organisation. 

Strong communication, more than many other factors, can be a leading and key element in business success. Communication powerfully contributes to all other aspects of a business. In a business, it helps effectively to deal with employees, customers, partners, and virtually all other stakeholders. A good communication model in an organisation also can assist in finding new opportunities, increase industry awareness, cultivating connections, and maintain the best organisational culture.

The process of transferring information from a person to the other or one group to another, both internal and external, is termed business communication. Certainly, other definitions and elaborations do exist in the business world. However, to explain in simple words, the term is derived from general communication that is associated with the business activities of a single organisation. In other words, effective communication between parties or people on business-related aspects is called business communication. 

Variety of topics

Typically business communication is used to promote a business, product, or service on one hand and also is used to relay information within an operating business. This involves a variety of topics such as marketing, advertising, promotions, and relationship management. Internal communication refers to internal interaction within an organisation’s management and employees. 

Internal communications within the organisation include formal and informal exchanges of information, ideas, instructions, or messages. The internal exchange between employees and the management at different levels is effective and is a vital source of viewing, representing, and solving organisational issues related to the business.  

The biggest advantages of effective internal business communication are the increase of job satisfaction levels, productivity, and the overall efficiency of the employees. Internal communication can be initially divided into two categories. The first is the ‘internal upward’ that involves the communication flow from the bottom of the hierarchy to the upper management.  

For example, the information gathered through the sales team via various reports regularly is communicated to the higher management as briefs. This helps the top management to understand the ground-level issues on any related criteria. The information in turn helps the management to make important decisions on business-associated matters to improve the revenue of the company.  Bottom-up communication plays an important role where subordinates find an opportunity to transmit their views on a business or even a personal issue to the hierarchy.  Also, the top management can obtain timely feedback, new and creative suggestions, official or personal requests, and any other escalating concerns. 

The downward internal communication also is equally important where the upper management can pass on their views, instructions, guidelines, policies, and other management information to the employees at lower levels, relating to doing their assigned tasks.  Typically the messages of the management are passed through a chain of hierarchy to obtain optimum effectiveness. 

 Successful motivator

For example, a warning letter from the company is communicated to the employee through the HR department via the immediate superior to keep everyone involved informed. The internal downward communication can either be oral or written, communicated through memorandums, notices, emails, short messages, or face-to-face conversations.   

Internal communication, if used correctly and timely, is a successful motivator for employees. Perhaps, this can be a better alternative than motivation by offering financial benefits. It can also enhance the job-related decision-making capability of employees. Communication plays a crucial role in supporting employees to build social bonds where they can be encouraged in teamwork practices. It is proven that staff with strong social bonds perform with increased efficiency with better team spirit.

Lateral communication is the exchange of information among co-workers through verbal and written messages or discussions. The horizontal or lateral inter-departmental and cross-department communication allows the employees of the same level to communicate important matters among themselves. 

For example, a standard management meeting held between managers can discuss or exchange information on marketing, production, administrative, and other common business issues. Usually, successful companies depend on the minutes of such meetings in addition to encouraging written communication among managers.


External communication is the effort of an organisation to communicate with people and other outside organisations about the business, its products, and/or services.  External communications focus on spreading the news effectively to target audiences including customers, suppliers, service providers, and any other stakeholder linked to the business. 

The key goals of external communication are to increase revenue on one hand and to minimise costs on the other.  Common examples of external communications include advertising and promotion efforts, press releases, publications, newsletters, digital campaigns, websites, and so forth.

Public perception is an extremely vital ingredient in a business. It is as important as the bottom line. Effective business communication is the most important aspect of shaping the image of an organisation to the society at large (societal impressions can be vital to a company in the long run) and to its own existing and prospective customers, possible investors, and other stakeholders. Every external communication effort helps the company to make the public aware of the products, services, locations, and any other important information.  Perhaps the most important function of external business communication is that it finds new customers.

The main goal of external communication is to find customers, sell products or services, obtain revenue, and increase profits for the survival and growth of the business. 

One exceedingly important factor to consider seriously is the possibility of the public back clash when using interactive technology such as social media.  One negative comment can initiate a chain reaction detrimental to the image of a perfectly good organisation. 

Such damage to the image cannot easily be reversed in a short time. However, the benefits of new technologies that are far-reaching and make an organisation communicable with large audiences in communications outweigh the risks by a considerable margin.   Modern communication practices compel companies to use digital media as much as possible to reach customers. While external business communication is the key to reaching out to the public, it has challenges, if not communicated extremely cautiously.

If the public perception is damaged through a bad message or misplaced quote, it can be costly.  Therefore, when choosing and designing external communication programs, the organisation has to be extra careful with its audience preferences.  

Companies use strategies such as developing web content, Search Engine Optimisation (SEO), and content marketing to communicate with outsiders on important information. Through effective content marketing, companies can ensure the visibility of their websites. Through two-way communication flow by way of comments and other feedback from viewers, organisations can amend, adjust or create business strategies.  

In every type of organisation, small, large, private, or public, communication plays a vital role. This is the reason for the phrase ‘good communication leads to good business’ is looming around. 

The efficient performance of an organisation largely depends on communication effectiveness, internal and external. It helps the organisation in business grow while enhancing the morale and motivation of employees that minimise internal and external conflicts. 


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