COMMUNICATION

1 MODULE - 1 Business EnvironmentNotes 83 CommunicationDIPLOMA IN INSURANCE INTRODUCTIONC ommunication is very important function to manage anyorganization whether it is small or large. In other words,nothing happens in management until COMMUNICATION word COMMUNICATION has been derived from Latin ward communis which means common. Thus communicationmeans sharing of ideas is common. It can be defined asexchange of facts, ideas, opinions or emotions between two ormore persons to create a common ground of is the process of passing information &message from one person to another.

2 It involves atleast twopersons a sender & a receiver. The sender develops &transmits a message to the receiver. The purpose is to achievecommon understanding between the sender & the basic unit of COMMUNICATION in an organisation is thelink between manager & subordinator. Managers communicateto their subordinates & receive messages from them. To beeffective as a manager, you need to be an OBJECTIVESAt the end of this lesson you will be ablezTo know the COMMUNICATION process to be followed inany organizationzHow informal COMMUNICATION is more important than theformal communicationDIPLOMA IN INSURANCE SERVICESMODULE - 1 NotesCommunication Business Environment COMMUNICATION FUNCTION IN ORGANISATIONSThe COMMUNICATION function as the means by which theactivities in the organisation are coordinated to achieve theorganisational goals.

3 It is also the means by the whichbehaviour is modified, change is effected, information is madeproductive & goals are achieved. Whether it is with a businessenterprise, a family, educational institution or trade exhibition,the transfer of information from individual to another isabsolutely are two main types of COMMUNICATION in everyorganisation formal & informal Formal CommunicationFormal COMMUNICATION refers to official COMMUNICATION whichtakes place through a chain of commands. It flows in formallyestablished channels & is concerned with work related of the enterprise and expected to communicationwith one another strictly as per channels laid down in formal COMMUNICATION may be divided into three categorieswhich are given as follows:a)Downward COMMUNICATION :Under this system, the flow of COMMUNICATION from the topmanagement downward to be operating level.

4 It may also becalled a COMMUNICATION from a superior to a subordinate. Itfollows the line of authority from the top to the bottom of theorganisation hierarchy. Downward COMMUNICATION consists ofplans & policies, orders and instructions, procedures & ) Upward COMMUNICATION :It means the flow of information from the lower levels of theorganisation to the higher level of authority. It passes fromsubordinate to superior as that from worker to foreman,foreman to manager. From manager to general manager & soon. This COMMUNICATION includes opinions, ideas, suggestions,complaints, grievances, appeals, reports is very important as it serves as the feedback on theeffectiveness of downward COMMUNICATION .

5 Management is ableMODULE - 1 Business EnvironmentNotes 85 CommunicationDIPLOMA IN INSURANCE SERVICESto know how well its policies, plans & objectives are followedby those working at lower levels of the organisation. It keepsthe management informed about the progress of the work &difficulties faced in performance. On the basis of upwardcommunication, the management revises its plans & policies& makes further )Horizontal COMMUNICATION :The transmission of information and understanding betweenpeople on the same level of organisation hierarchy is calledthe horizontal COMMUNICATION . This type of COMMUNICATION isalso known as lateral or sideward or crosswise , it pertains to inter departmental managers workingat the same level of organisation or among subordinatesworking under one boss.

6 Horizontal COMMUNICATION speedsup information and promotes mutual understanding. It enablesthe managers working at the same level to exchangeinformation and co-ordinate their activities without referringall matters to the higher level of horizontal COMMUNICATION is generally of an informalnature. Whenever a departmental head requires someinformation from another departmental head, he tends tocontact him directly. However, this type of COMMUNICATION canbe oral or Informal CommunicationThere is also a great deal of informal COMMUNICATION in anorganisation. This COMMUNICATION flows through informalchannels and may or may not be work related.

7 Informalcommunication cuts through the formal organisationalstructure. Most of us are familiar with the term grapevine used to describe a network of informal are present in all organisations. In fact, in largeorganisations, there are many grapevines moving up, downand across flourish because COMMUNICATION is a naturalhuman tendency. People who know each other in theorganisation talk together informally. One thing they have incommon is the organisation they work for, so they talk aboutthe happenings in the carry two types of information : work related andpeople related.

8 Employees want to know what is going on inDIPLOMA IN INSURANCE SERVICESMODULE - 1 NotesCommunication Business Environment 86the organisation. When they are not kept informed throughformal channels, they seek information from the , they are curious about the people they work carry the type of personnel information notgenerally communicated through formal get to know plans, promotions, punishments, etc,much before they are formally announced. Informalityhowever, reduces uniformity of COMMUNICATION and sometimesfalse or distorted news is employees consider the grapevine their main source ofinformation.

9 It is fast- they get information quickly and moreinformation is given than is normally included in formaldownward communications, which are often written and mayoriginate from some one they do not know often become frustrated with grapevines, particularlywhen they carry incorrect information. But grapevines exist;managers cannot stop them. Managers can, however, increasethe accuracy of the grapevine by feeding it correct they can try to reduce the relevance placed on grapevinesby making certain that formal COMMUNICATION is complete QUESTIONS Types of formal Whether informal COMMUNICATION is good for anyorganization?

10 IMPORTANCE OF COMMUNICATIONC ommunication is an indispensable part of the process ofmanagement. The success of an enterprise depends upon theeffective of COMMUNICATION . Every manager must communicatein order to get things done through others. A goodcommunication system offers the following benefits :1. Basis of Decision-Making and Planning. Communicationis essential for decision-making and planning. It enablesthe management to secure information without which itmay be possible to take any decision. The quality ofmanagerial decisions depends upon the quality ofcommunication. Further, the decisions and plans of theMODULE - 1 Business EnvironmentNotes 87 CommunicationDIPLOMA IN INSURANCE SERVICES management need to be communicated to thesubordinates.