7

Organiztional Communication

SOME IMPORTANT FUNCTIONS OF MANAGEMENT

Exhibit 7.1 shows some important functions of management. The function of communication is to define and support the action involved in each of these functions.

Forecasting	Determines organizational objectives and policies
Planning	Prepares programmes, procedures, and budgets
Organizing	Sets the organizational structure
Instructing	Provides the bedrock of organizational performance
Coordinating	Ensures all efforts are directed towards the organization's goals
Controlling	Checks the results and receives feedback

 

Exhibit 7.1 Functions of Management

• Forecasting and planning: Each function of management depends on effective communication for its success. For example, if the management fails to communicate its objectives, policies, programmes, procedures, and budgetary provisions to the concerned people at the proper time, an organization would fail to run in an organized and targeted manner.
• Organizing: Organizing, as a management function, determines the formal and informal relationships within the organization and outside it. These relationships are developed and maintained through interpersonal communication.
• Instructing: The function of instructing depends entirely upon effective exchange of information regarding products, processes, and targets.
• Coordinating: Coordinating is perhaps the most demanding of all management functions. It requires excellent communication skills to ensure that all efforts are directed towards the achievement of a single organizational goal. To ensure that diverse activities are complementary, a manager should be able to relate with all the people involved, both formally and informally.
• Controlling: Finally, in order to control processes, a manager should be able to receive and interpret information and respond quickly.

NEED FOR COMMUNICATION IN MANAGEMENT

How Communication Is Used by Managers

Management is a unified, organized, and cooperative system committed to the achievement of common goals. Unity of purpose and commitment to a single organizational goal can be developed only through the persuasive power of communication. To do this, a manager needs to have excellent communication skills, including the ability to structure information according to its negative/affirmative nature and use words and tones according to the purpose of the communication. A manager should be able to create the desired relationship with the audience or employees to produce the needed response. Thus, diverse strategies, verbal and non-verbal, of effective communication form an important part of management as a discipline.

 

From a small business to a multinational enterprise, every organization today needs an effective communication system to enable it to function and flourish. Communication is a means of:

• Increasing employees' job performance and effectiveness by updating their knowledge
• Promoting employees' sense of belonging and commitment
• Effecting changes smoothly
• Motivating employees and creating a sense of identification with the organization's goals
• Informing and convincing employees about decisions and the reasons behind them
• Helping employees develop a clear understanding of their roles and growth opportunities within the organization
• Empowering employees with information on development and activities

Hence, an active communication system is vital for the good health of an organization. If there is continual sharing of ideas and interactive meetings between the management and employees, an overall atmosphere of understanding and goodwill would prevail in the workplace. When decision-making is transparent, employees understand the reasons behind decisions and accept and implement them, even if those decisions affect them adversely. Thus, communication can help in management in the following ways:

• Creating a sense of belonging: An understanding of their roles and career paths in the organization makes employees feel a part of the whole setup.
• Resolving disputes: All disputes in organizations, which lead to huge losses of time, money, and good human relations, are caused by communication failures.
• Providing a holistic view of the situation: A great value of effective communication lies in making people not only know, but also perceive and understand the meaning of things happening around them. Through clear communication, employees not only “see” the realities of the business, but also develop a “feel” for it.

In the changing business environment of multinational c ompetition and globalization, communication has become an important comonent Identify new trends in organizational communication due to technological changes and developments. of an organization. Like the functional areas of production, marketing, and finance, communication too is evolving into a distinct discipline in the form of corporate communication.

Theoretically, corporate communication brings under a single umbrella all communication activities undertaken by different areas, such as marketing and public relations, which are directed at image-building and developing human capital. In this integrated form, communication speaks to the world outside the organization and within it in a single voice that builds the corporate image.

 

Several changes in the modern technological age of information have made people pay more attention to communication as an important tool in successful management. These changes are:

• Bigger organizations: Organizations are getting bigger and bigger, either due to increased levels of production or through multinational collaborations. The large size of organizations today poses problem in communication lems in communication.
• New developments in information technology: The modern age, the age of information, is not just an era of new media—telephone, radio, television, communication satellites, computers, and so on; it is also an era of a new attitude towards knowledge and the value of sharing it with others. In fact, communication is now looked upon as a source of empowerment of people. But, the success of these new media depends on the skills of those who use them. It involves a new attitude towards the value and use of good communication.
• The concept of human capital: Employees and workers are now considered to be the human component of business and not just the source of labour. Their attitudes, interests, and welfare constitute an important aspect of management. Hence, there has to be a live channel of communication between the employees and the management.
• Need to learn corporate etiquette: Top corporate executives are increasingly being sensitized to the importance of conducting meetings, seminars, presentations, and negotiations effectively They realize that management executives should learn the rules of etiquette if they are not already familiar with them. This includes knowing how to greet others, shake hands, dress for success, exchange business cards, listen, and converse with a diverse variety of clients.

Corporate etiquette training, which is a part of communication skills, focuses on the rules to be observed and practised for success in international and national business ventures. Good business manners speak of the culture of the organization, not just of the individual.

These contemporary changes suggest that organizations now need not only an effective communication system, but also executives and managers who are well equipped with effective communication skills.

Communication Concerns of the Manager

In business, a manager spends most of his or her time either speaking or writing to colleagues, supervisors, subordinates, or clients. A manager's success depends largely on his or her ability to communicate what has to be done and why to colleagues.

To be able to do this, the manager has to devote his or her time to:

• Receiving and interpreting information from other managers and departments
• Sending information to other department managers
• Passing on information and suggestions on new plans or projects to senior/top management
• Transmitting information to subordinates
• Developing a positive attitude

To a large extent, the success of an organization requires an atmosphere in which there is a free flow of information—upward, downward, and horizontally. At the workplace, the primary goal is getting things done. For this, instructions, guidelines, supervision, monitoring, and periodic reporting are usually considered enough. But if the company wishes to achieve more than the set task, a real involvement of all employees, from the highest to the lowest levels, is required. This cooperation can only be secured by allowing every level of employee to suggest ideas, express their views, and share their experiences. Such a system of communication can only be established within the organization by the manager. In fact, the manager functions as the point of intersection for all communication channels. One of the most important concerns of the manager is to organize and ensure an effective information system across the organization.

 

As analysed by Henry Mintzberg¹ of the Massachusetts Institute of Technology, managers need effective communication skills to perform in the following interrelated situations:

• Interpersonal
• Informational
• Decisional

These situations, with their descriptions and examples, are clearly described in Mintzberg's book, The Nature of Managerial Work.

The interpersonal role refers to situations in which the manager acts as a figurehead, leader, and liaison officer. The informational role is when the manager is a monitor, disseminator, and spokesperson. In the decisional role, the manager functions as an entrepreneur, troubleshooter, resource allocator, and negotiator.

 

• Interpersonal role: It is necessary to ensure the effective operation of the organization's systems and to maintain proper relationships within the organization and with clients, suppliers, and other functionaries. If interpersonal communication is effective, internal systems run smoothly. For example, personnel functions within the organization require managers to inspire confidence, win support, and guide workers. Managers are role models for others and must develop the skill of listening patiently and perceptively in order to understand the needs of their subordinates. This is essential for creating an atmosphere of mutual understanding and goodwill within the organization and transparent sharing of its objectives, mission, and problems.

   

  Decisions that are based on guesswork and are made without access to all relevant information may turn out to be unrealistic and harmful.

• Informational role: If the internal information-sharing system of a company is effective, other systems, such as stock control, personnel functions, financial systems, and quality control operate smoothly. Shortcomings and problems can be quickly identifed and remedial action taken immediately. Proper maintenance of product and service standards can be ensured through timely monitoring and instructing. Through effective, interactive communication and a strong feedback system, high morale and satisfaction of workers can be secured.
• Decisional role: Decision-making is based upon receiving and interpreting all relevant and necessary information. Decisions that are based on guesswork and are made without access to all relevant information may turn out to be unrealistic and harmful. Managers need to possess the skill of receiving relevant and up-to-date information correctly and accurately to be able to take decisions and act rationally, fairly, and to the satisfaction of all concerned.

All these functions require the manager to handle people and situations with a good knowledge of human needs.

IMPORTANCE OF COMMUNICATION IN MANAGEMENT

Communication skills constitute an important aspect of effective management. Management is a complex process. In simple terms, it can be described as the organization of capital, labour, and material to achieve production and distribution of particular goods or services.

First, the management determines its objectives—what it must do and how it must do it. Then, there has to be a system through which the production and distribution processes can be guided, coordinated, and controlled to ensure that the management objectives are achieved. Communication is the system by which production and distribution operations are controlled and coordinated and the results correlated to the objectives.

COMMUNICATION STRUCTURE IN AN ORGANIZATION

In business organizations, the effectiveness of a communication system depends upon the extent to which the necessary information (required for decision-making) reaches the concerned person (the person who needs that information) at the right time (when the information is needed). The network of information should support the overall functioning of management by integrating and coordinating the workforce for achieving organizational objectives.

Hence, every organization creates a network (channel) for information to pass through different levels of authority and functional heads and units. The flow of communication follows the structure of the organization. In actual practice, the information passes through the organizational pyramid such as the one shown in Exhibit 7.2.

 

Vertical Communication

In organizations, there are well-defined lines or routes for passing on communication. Policy decisions are taken at the boardroom level. From there, information is sent downwards to senior managers or a group of senior managers. They ensure that the policy decisions are easily understood, implemented, sustained, monitored, reviewed, and reported. Feedback (performance data or employee experiences or suggestions) is, in turn, sent upwards.

In this system of communication, the key links are the managers and supervisors. They transmit information both upwards and downwards. They are also responsible for following up on ideas and instructions. In all large organizations, the human resource or personnel department manages the circulation of information among employees. Personnel managers are in constant touch with all employees. They are able to identify needs, provide guidance on policy matters, and supervise infrastructural rearrangements.

 

However, when an organization has too many levels of hierarchy, managers may find it difficult to reach ground-level and shop-floor employees. In such situations, communication tends to be slow in reaching and delayed in being absorbed and acted upon. The cost of this delay, caused by the sheer size of the organization, may sometimes be too high.

Hence, as Peter Drucker holds, large organizations have more recently moved towards a “flatter structure” of information-based management and executives “walk down” the jobs. This is obviously to facilitate information flow downwards and to prevent employees from getting frustrated by their sense of isolation.

Horizontal Communication

Also known as peer communication, horizontal communication is usually needed within the organization due to:

• The geographical location of divisions
• The functional basis of division

Geographical Organization

In a large setup, divisions may be based on geographical areas. Such divisions may be known just by numbers or single letters. For example, at Tata Steel (Jamshedpur), the “G” blast furnace has its own division with a full-fledged hierarchy of employees and executives. There are other furnaces known by numbers, with their own divisions. They are all located on the vast Tata Steel site. There are also other divisions, such as research and development, total quality control, and so on. Each of these divisions maintains close contact with the others through seminars, presentations, and executive meetings. These divisions communicate among themselves to share information and help each other as equal members of the same organization. Thus, communication helps sustain a sense of unity among the various divisions in the organization.

Functional Organization

Normally, business and industrial organizations are divided on the basis of different functions, such as production, marketing, finance, personnel, and training and development. All divisions function independently and yet remain linked with each other through peer-group communication and workflw information. With the growth of technology and the increasing size of organizations, the widespread production of goods and services needs to be coordinated through the channel of horizontal communication. From the stage of selection of raw material to the finished product, numerous processes are involved in completing the given task of production. At each stage of the production process, the job of a workgroup depends upon the timing and form of work received from the preceding workgroup. Any interruption in the workflow adversely affects performance at successive stages of production. The workflow in a company can be steadily managed only through horizontal communication between the sections that are directly linked.

COMMUNICATION AND THE LINE AND STAFF MANAGEMENT

Line and staff management (LSM) is a system of management in large organizations consisting of line managers and staff managers. Line managers are responsible for the main activities of the company, such as manufacturing and sales, while staff managers control the support and service areas, such as accounting, distribution, and personnel. A network of relationships between those in line (functional) management and staff (support) management is created by means of an effective internal communications system. Without this, an organization can neither function properly nor thrive in the business world. As shown in Exhibit 7.3, the internal communication system can be divided into two categories—formal lines of communication and informal lines of communication.

 

 

FORMAL AND INFORMAL COMMUNICATION

Formal Communication

Formal lines of organizational communication include:

1. Line relationships
2. Functional relationships
3. Staff relationships

Line Relationships

Line relationships refer to the line of authority that sets down the path of communication from supervisors to subordinates and vice versa. All official communications, orders, and instructions move from seniors to subordinates. Similarly, all follow-up actions and compliance and execution information and reports move upwards, from subordinates to supervisors and executives. Usually, all organizations insist on following the normal chain of authority from one position to the next. If the communication is in the form of a letter, this respect for the chain of authority is indicated by writing the phrase “through the proper channels” in the beginning of the letter.

 

If the communication is oral, the message is conveyed to one's immediate supervisor.

Functional Relationships

Functional relationships are those between departments within an organization. Communication that occurs when departments share information regarding work and related organizational matters with each other is a formal line of organizational communication.

Staf Relationships

Staff relationships include the communication that supports line management, marketing, and production. They do not carry the executive authority of line relationships. Communications relating to personnel, public relations, administration, or finance are part of staff relationships.

Informal Communication

Informal communication in an organization usually flows through chat and the grapevine.

Chat

Horizontal or lateral communication is between managers from different departments or within the same peer group. Managers of the same level enjoy the same level of authority. Often, informal communication, which is usually in the form of a “chat”, has to be confirmed in writing before it goes through the official channel.

GRAPEVINE

Theoretically, the network of formal communication may be adequate to meet the needs of exchanging information within an organization. But, in real life, this is seldom true. Often, employees feel inadequately informed in a formal system. They may suspect that the management uses formal channels to conceal rather than reveal the true message. They may thus, accuse the system of lacking transparency. As a result, employees modify the formal methods of communication by bringing in an informal communication system, the grapevine.

 

Information obtained via the grapevine is always attributed to “a reliable source”. “Learnt through a reliable source”, is a common phrase used by the communicator to make the news sound authentic.

However, the grapevine may create complications for the information system of organizations.

• The unofficial version of news, irrespective of its basis, is more easily believed by people.
• News through the grapevine spreads like wildfire, quickly and uncontrollably.
• Usually this version of information is somewhat distorted and exaggerated—a result of the vast chain of “filters” used in the process.

 

The grapevine exists in all workplaces. It is an informal adjunct or extension of the formal system of organizational communication. In a way, it is a corrective to the management's system of information as it is timely and has a wide reach. It poses a challenge to management's MIS (Management Information System).

The presence of the grapevine shows that the management has missed an opportunity to share information of interest with their employees. The gap in formal communication is filled by informal gossip circulated among employees, who form relationships on the basis of their work or common social factors, such as neighbourhood, language, culture, state, club memberships, and so on These relationships are formed on the basis of friendship and not official status.

Participants in the grapevine are non-official leaders who generally initiate and spread the gossip across the organization. As with formal communication, there is a sender and a receiver.

Normally, the management views the grapevine negatively as it undercuts confidentiality, secrecy, and guarded sharing of information with employees. However, sometimes the management itself may take advantage of the grapevine, for instance to learn in advance the reaction and response of employees to a proposed scheme or change. In such a situation, before officially announcing the change, the managers may deliberately feed the leaders of the grapevine with the concerned message and note employees' feedback and responses.

This managerial practice is not always on the sly. Some management scholars approve of this practice of supplementing formal communication with informal communication. Koontz and O'Donnell observe, “The most effective communication results when managers utilize the informal organization to supplement the communication channels of the formal organization”.

When using informal channels of communication, managers have to be very careful about the form of informal communication. For example, it could be very effective to “walk down the job”—move around the office, chat, and informally discuss formal matters. But, the effectiveness of this depends on the personal relationship between the executive and his or her subordinate and the image created by the executive by his or her official behaviour and personal attributes, such as frankness, attitude, and sense of fairness. As Leland Brown says, “In using the grapevine, management must be able to pinpoint the leaders and work through them. It must feed in factual information, listen to the feedback response, and be discerning in not overloading the system and using it inappropriately. It is important that management be sure to follow up the grapevine message with official written messages and statements that will verify the accuracy of data obtained from the grapevine. This helps in building a mutual trust based on open communication followed throughout the organization or business.”

Merits of Informal Communication

The chief advantages of informal communication lines are:

• Uniting force: The grapevine brings together employees in matters of common interest.
• Speed: Informal channels of communication pass on messages speedily.
• Creation of ideas: Informal communication, through sharing of ideas and views or by spreading unofficial “grapevine”, generates ideas and expectations that often prove of value to decision-makers and planners.
• Good personal relations: Public relations fail in organizations because of the lack of good personal relationships. Informal communication that promotes personal relations is, therefore, important for the success of public relations.

Emphasizing the value of informal communication in management, especially via the grapevine, Myers and Myers assert that field research and laboratory experiments indicate that “grapevine communication is fast; predictable in its course, directions, and membership; and also far more accurate than a casual observer might imagine. Grapevine communication is less heavily loaded with task information—how to do the job—than with information about people, attitudes, relationships, interpretation, prediction, values, norms, and needs”.

Limitations of Informal Communication

The limitations of informal communication channels are:

• Rumours: Sometimes informal communication, especially grapevine, can prove very provocative and disastrous for the relationship between employees and management. By its very nature, grapevine is information that lacks solid evidence. Moreover, there is little accountability in spreading it. By exciting hopes or fears in employees, rumour mongering may result in a negative or misleading situation in the workplace. As a consequence, the management negative or misleading may be confronted with a wave of prejudice, emotions, biases, half- situation in the workplace. truths, and ambiguity.

   

  By exciting hopes or fears in employees, rumour mongering may result in a negative or misleading situation in the workplace.

• Inadequacy: Informal communication can only pertain to certain kinds of organizational information—that is, non-functional issues and matters. Secondary issues regarding staff and management relations are generally the subject of grapevine.
• Changing interpretations: When information is allowed to be spread through the grapevine, it tends to result in distortion and dilution of the main issue. The key person, the individual who starts spreading the news, is sometimes surprised by the final form in which that news gets back to him or her. Just as in the game of Chinese Whispers, the distortions are unintentional. Changes in interpretations happen owing to the different perceptions of the persons involved in the chain. The unlimited circulation of a statement can make it lose its original meaning and character. Great caution is, therefore, needed in using informal communication channels as a supplement to formal communication.

Finally, it is the responsibility of the formal communication system to ensure that opportunities for misinterpretation of information through the grapevine do not occur, by giving full and necessary information to employees in a timely manner. Therefore, besides interactions at the functional level, people should be able to talk to one another about formal matters informally on different occasions.

CORPORATE COMMUNICATION

In the changing business environment of multinational competition and globalisation, communication tends to become an important component of an organisation. Like the functional areas of production, marketing, and finance, communication too is shaping into a distinct area, in the form of corporate communication.

Theoretically, it is to bring under a single umbrella all communication activities done by different areas, such as marketing, PR/OM, and the like, directed at good image building and developing human capital. In this integrated for, communication is supposed to speak to the world outside the organization and within it in a single voice, what marketing or public relations or quality control speak in different voices, to build the corporate image.

Several changes in the modern, socio-technological age of information have made people pay more attention to communication as an important tool of successful management. These changes are:

Size of organization   Big organisations are getting bigger and bigger either through their own increased level of production or through multinational collaborations. The very size of organizations today poses problems for communicating. These problems have got to be looked into for a proper running of the whole project.

The concept of human capital   Employees and workers are now considered to be the human component of business and not just the source of labour. Their attitudes, interests, and welfare constitute an important aspect of management. Hence, there has to be a live channel of communication between the employees and the management.

Need to learn corporate etiquette   Top corporate executives are increasingly being sensitized about the importance of knowing how to conduct meetings, seminars, presentations, and negotiations. They realize that management executives should learn the rules or etiquette, if not already familiar with them. These include:

1. How to greet
2. How to shake hands
3. How to dress for success
4. How to present cards
5. How to listen
6. How to converse with seniors/ladies/ and clients

The training, which again is a part of communication skills, develops the corporate etiquette to be observed and practised for success in international/ multinational/ or big national ventures. Good business manners speak of the culture of the organization, not of the individuals in particular.

These contemporary changes suggest that organizations not only need an effective communication system; they need to have executives/managers who are well equipped with these skills.

Information to Be Communicated at the Workplace

To reduce the chances of misinterpretation or disinformation being spread by the grapevine, an organization should keep all its employees informed about certain facts regarding it. The content of the information is generally a mixture of facts, opinion, attitudes and interpretation. The purpose is to instruct, persuade, and ensure a routine for one-way transmission of information.

Broadly, all business communication can be divided into five types of information:

1. Statutory information: Information regarding terms and conditions of service should be communicated to all employees as a statutory requirement.
2. Regular work-related information: Information regarding normal work situations has to be regularly communicated through routine formal briefing sessions or through informal chat sessions between the manager and group members.
3. Major policy or operational changes: Any major changes in the organizations policies, which affect everyone or a large number of employees, have to be communicated to all by calling special meetings or by issuing notices.
4. Information bulletin: To keep people informed about events and happenings in the organization, periodic information in the form of a newsletter is disseminated to all employees. This helps create a sense of involvement in the working of the organization.
5. Communication by expectancy: Information regarding critical changes should be carefully and gradually communicated to those who are going to be directly affected by the decision. Before the decision is implemented, the people concerned must be prepared for it. This process aims at creating expectancy in the receivers, so that they are prepared for upcoming changes.

REVIEW YOUR LEARNING

1. Discuss how communication is the lifeline of an organization's health.
2. Indicate the new trends in organizational communication due to technological changes and developments.
3. What are the main concerns of a manager? How should he or she fulfil them through effective communication? Discuss.
4. Analyse the corresponding relationship between channels of communication and the structure of an organization.
5. Discuss the formal and informal lines of organizational communication.
6. What is the grapevine? What gives rise to this communication phenomenon in organizations? How can the management prevent it from spreading?
7. Discuss the advantages of informal lines of communication in the workplace.
8. What kinds of information need to be communicated to an employee by the organization?
9. Discuss the responsibility of senior management for establishing and promoting a sound communication system.

REFLECT ON YOUR LEARNING

1. What are the ways in which organizations encourage or discourage “upward” communication?
2. “A flat organization is a myth”. To what extent can an organization function without a structure with levels of authority?
3. How does training promote effective interpersonal behaviour?
4. In an organization, one learns new attitudes towards working with others. How does communication help an individual's learning behaviour?
5. Identify the advantages and disadvantages of having a clearly defined communication policy from a manager's point of view, especially in relation to employees' needs.