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History of Internal and External Communication in the World of Business

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External Communication in Business


Information is essential to business processes as it involves the transfer of data to both internal and external parties. The information flows through different channels depending on the tool used by a firm. The need for business information has gained importance for the past two decades. The significance is dependent on the evolving nature of the technology that affects communication between parties with both internal and external relationships.

The emergence of different business strategies such as corporate mergers, downsizing, and reengineering leaves employees uncertain hence there is the need for effective internal communication channels ensuring the future of the business. The use of mobile communication devices creates organizational culture through informal and formal communication channels. As a result, organizational leaders saw the need to use such channels to converse with stakeholders. Therefore, even though organizational leaders saw the development of technology as a major threat to company information, they used the strategies to enhance the internal relationships with employees as well as the image of the business.

The development of information technology is significant to the business as it is applied in a range of phenomena such as management of human resources and external parties. For example, information technology influences culture as well as business internal processes and external relations. As a result, the development of information technology affects both internal and external business communication. The development of mobile information devices increased the speed of idea sharing and, as a result, communication.

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Communication Process, Networks, and Channels

In the book Business and Industrial Communication: A Source Book published by Harper & Row, Redding William and George Sanborn define business communication as all the information sent or received within a firm affecting performance. The information is different from social information due to formality and medium. The success of the business depends on the effectiveness of communication channels. Additionally, information must have a plan.

For example, information may be aimed at instructing where an individual conveys information to guide while accomplishing a task. Information can also be used for integration, where it aims to enhance interrelationship among different functional units (Rosengren 154).

Additionally, information may be essential for informational purposes. Thus, information may be transmitted to the stakeholders who are both internal and external. For example, it may intend to inform employees of the available opportunities in the organizations or the state of employment. Redding William and George Sanborn in the abovementioned book state, “It is a tool for appraisal” where the HRD reviews the contribution of personnel to the business. According to HRD, information may be vital for learning purposes. For example, the HRD adopts orientation to new employees. The process involves the introduction of business programs, policies, and culture (Rosengren 155).

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The information serves as a tool to introduce a product to the market or relay reports on the state of the business such as financial position to the stakeholders. Consequently, a business builds an image of the public through effective communication strategies. The business has a corporate social responsibility and cannot isolate from the public. As a result, for the business to have goodwill and public confidence, it must market its brand efficiently. Communication happens through different media such as television and print sources that help the business inform society of the goals, progress, and social responsibilities. Finally, information is essential for the effective decision-making process (Rosengren 148).

For information to be effective, it must pass through a cycle. The cycle involves the sender, message, encoding, channel, receiver, decoding, and feedback. The process begins with a person’s need to relay facts, opinions, or views to a second party. The next step involves the translation of the information into a language that reflects the view. As a result, for information to be effective, Redding William and George Sanborn in the book Business and Industrial Communication: A Source Book published by Harper & Row say, “a sender must encode information,” which depends on the relationship with the sender and other situational factors. After the process, the sender uses a channel to reach the second party, who should understand the intention (Rosengren 150).

The above information concerns both internal and external communication. Internal communication occurs within a business. In most cases, it involves directives from the top management to employees. However, it may also involve interdepartmental information in the case of joint projects. Employees must also communicate to accomplish a task. Moreover, employees may engage in sending information to top management and later receive feedback.

As a result, internal communication involves upward, downward and horizontal communication, depending on the direction of information flow. Redding William and George Sanborn in the book Business and Industrial Communication: A Source Book were the first to acknowledge the need for business information. About a 1927 study by Harvard Graduate School of Business, they enhanced the significance of bottom-up and horizontal communication. The study also established that communication affects employee performance and enhances organizational performance.

Talking about outside information involves the relaying of information to outside parties and their feedback. Such information may be transmitted to the public, namely consumers, government, firms, and stakeholders. Marley in “Investigating the Appropriateness of the Theory of Organisational Knowledge Creation as a Management Model for Practice-Led Research” (5) describes that both internal and external business communication was not as significant as it is today. For example, Redding and Sanborn argue that the emphasis on internal business information was not laid until the mid-20th century.

Historical Developments

The telegraph introduced in the early 1880s changed both the scale and pace of business information. Du Boff in the article “Business Demand and the Development of the Telegraph in the United States, 1844–1860” published in Business History Review says that the emergence of the telegraph expedited long-distance information “like never before.” As a result, businesses could communicate on a global scale. For example, rather than sending mails by sea or carrier pigeons to reach the office, information was transmitted directly from any business to another. The invention also affected information within a business.

For example, business leaders used the telegraph for simple internal operational messages. However, in 1947, a sophisticated device developed in the business world. The device was the fax machine, which used scanning technology to relay information. During the time there were no systematic internal mechanisms for record-keeping. As a result, the information and managerial trend of the 1870s represent a shift from written records to ad hoc oral supervisors and management.

The fax technology used chemically treated paper and electric impulses to create marks. With the evolution of the above information tools, companies commonly used meetings and oral communication. For example, Du Boff (465) states that the failure of the telephone to replace a written medium of information illustrates the limit of technology. As a result, even with new technology, companies must use traditional methods of communication. The era also saw the development of group theory that adapted the new technology.

For example, large companies were a new phenomenon in the early 20th century, apart from the government and military. As a result, information theories explained how companies should work to achieve goals. For example, the classical theory developed by Frederick Tailor perceives employees as interchangeable parts of the company. Frederick Tailor studied production in factories, concluding that the work processes depended on the application of scientific principles to work and workers. As a result, organizational leaders designed each work to improve performance, hiring workers whose skills match the tasks and rewarding for productivity; thus, there were minimal bottom-top and horizontal communication.

Another contributor to the theory was Henri Fayol who states that operational efficiency depends on managerial practices. He outlines five elements of management and fourteen principles of admonitions. Moreover, he introduced the “Scalar Chain.” It represents organizational hierarchy, stating that information needs to flow through the chain to reduce misunderstanding. However, during emergency employees could communicate with each other and across the business idea of horizontal communication (Rosengren 124).

The third classical proponent is Max Weber who developed the theory of bureaucracy. He argues that business information should come from authority. Key components include the chain of commands with centralized decision-making, declination of work, and responsibility to avoid misunderstanding. As a result, companies avoided misunderstanding, which impairs productivity.

Additionally, organizational structures encourage top-down information more than bottom-top since most of the information channels were print and it was necessary to accomplish work while complying with rules. Furthermore, companies avoided the social information and employees heard other necessary information on the grapevine (Rosengren 125).

John Bowman in “Chester Barnard (Irving) (1886-1961)” (17) states that managers can only communicate with an infinite number of people, even though future information technologies challenge the theory. The communication strategy aims to promote change and deliver business results. For example, the strategic maturity model which evaluates the senior-level strategies necessary for information to aid a business illustrates that third-party vendors or in-house personnel mediated in the development of communications and spread the message downwards through written and oral mediums.

An article by Elon University School of Communications “Imagining the Internet: A History and Forecast” indicates that communication shifted to one-on-one with the integration of the telephone technology into business. The invention enhanced conference calls both within and outside the business. Consequently, it increased the speed and accuracy of information sharing and, as a result, replaced the telegraph. The telephone uses the principle behind the telegraph.

Elisha Gray and Alexander Bell transformed speech into electrical signals. Unlike the telegraph, telephone technology transformed electronic signals back into speech. The invention became popular in the business world. For example, the first transoceanic telephone call was realized in 1920, which enhanced international business transactions. As a result, the business could communicate to the outside parties, regardless of geographical barriers (Rosengren 125).

John Bowman in “Chester Barnard (Irving) (1886-1961)” confirms, “Increased one-on-one information the role of internal communication shifted from business to the work.” The research revealed that employees in a harmonious team with direct support from management performed better than in unfavorable conditions. Additionally, the author highlights the functions of organizational leaders.

Internal communication is not propaganda. As a result, it requires freedom to question and feedback. With the above philosophy, both mediation and face-to-face communication became a flexible means of interaction in business. Previous information techniques aimed to prevent employees from receiving information on business developments. However, the management would communicate when the public was about to insist on the development of the business.

Elon University School of Communications in “Imagining the Internet: A History and Forecast” states that increased information to the public as a result of the invention of FM radio frequencies. The development of FM frequencies is a predecessor of the AM broadcast, which provides less distorted sound. Additionally, FM radio created an increased allowance for a variety of both private and commercial stations. For example, during the economic boom of the 1920s people rushed to buy radios; as a result, the business adopted the new medium.

Additionally, learning institutions offered courses on broadcasting. Consequently, the print industry integrated radio broadcasting to develop a mass media industry. During World War II the population depended on radio and print sources to learn about both national and international developments. In addition to the radio and print technology, the invention of television caused increased external communication between companies and the public (Elon University).

After the introduction of television, Jeongyeon Lim, et al. in “A target advertisement system based on TV viewer’s profile reasoning” says that the mass media focused more on entertainment rather than state or educational content. It also focused on commercial activities where sponsors paid for content. As a result, it was a significant force in society, since it developed pop culture. The messages influenced the public due to the increased presence of compelling messages on TV, radios, magazines, and billboards among others. It also developed the concept of the celebrity where politicians and business leaders were famous. Because the trend increased among citizens, appeared the need for promotional techniques in the business world to attract consumers (Jeongyeon et al. 30).

With the above innovation, mass media marketing and promotion became part of the business process. Businesses were able to develop compelling messages to attract investors and customers. For example, companies were able to capture a large audience. In addition to telephone technology, the business received feedback. As a result, the information cycle between business and customers was complete. Therefore, it was an efficient way of attracting customers and investors since it reduced costs per area of coverage (Jeongyeon et al. 13).

Another significant development in technology as Kraut, R., et al. in “Internet Paradox. A Social Technology that Reduces Social Involvement and Psychological Well-Being” states are the invention of the computer and the World Wide Web. In the beginning, computers were large and only used by well-established organizations like universities and the military for research. Developments in satellite technologies enabled people to use computers to communicate.

As a result, companies could send information to any place globally and receive instant feedback. The invention also popularized personal computers in the 1980s, leading to a huge potential of internet technology. For example, scientists developed a linked information system across several computers. The development of the World Wide Web in the early 1990 popularized the internet for the possibility to exchange information (Kraut et al 1024).

In the 1990s, the internet was a significant communication advancement of the century. It facilitated communication between people from all over the world, allowing access and information sharing without problems while being comfortable at the computer. It enabled people to publish public messages, have two-way communication, and develop other communication tools. As a result, it developed new principles in organizational communication. For example, internal communication could be forbidden to the public.

Thus, the above developments led to the protection of privacy and business information. However, organizational leaders realized that they could deliberately prevent employees from getting some kind of information hence creating a dilemma on how to manage leakage (Kraut et al. 1017).

An example of the theory developed to support the increased interaction among employees and the business with the outside parties is the systems approach. Rosengren in Communication: An Introduction published by SAGE says that the strategy perceives organizations as “complex and competing for survival”. For example, a business is a combination of various parts that interact to achieve goals. The functioning of any of the parts relies on other units and interdependence enabled by the internet. Therefore, companies developed two forms of systems, namely closed and open. A closed system allows one to share information within a boundary (Rosengren 54).

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On the contrary, an open system allows one to share information both within the boundary and external systems. Features in organizational information included the exchange of information among subsystems and multidirectional channels used in internal communication. The feedback helped systems to adjust, change and maintain control. Additionally, it also provided collective decision-making processes and responsibilities. The development triggers a change in employees’ information from HR to executives (Rosengren 57).

The Internet also led to innovations in information such as cell phones. Kraut, R., et al. in “Internet paradox. A Social Technology that Reduces Social Involvement and Psychological Well-Being” says that business leaders used the technology to communicate to both internal and external partners. Regarding internal information, a person on pager duty communicates with team members to accomplish a task. The devices were, therefore, significant to the business and individuals so that organizational leaders required employees to possess such devices.

The strategy led to the development of new information and information business communications. The internet altered the market and shareholders' connection. The lack of face-to-face communication facilitated the development of creative expression. Such technology, which includes blogs, websites, social networks, and chatrooms, revolutionized communication channels to external parties of the business (Kraut et al. 1017).

The advancements in technology led to a change in business information that caused the rise in the cultural approach. The approach recognized the need to integrate socio-cultural factors into the business. Moreover, companies benefited from the approach since it provided them with the organizational identity that determined how they coped with environmental factors. The reason behind the approach is that it perceives information as a culturally-based process of information sharing and developing relationships (Rosengren 176).

For example, with the use of mobile communication devices, individuals create and influence organizational culture through informal and formal communication channels within a short period. Additionally, organizational leaders use such channels to converse with stakeholders. Finally, PR specialists and marketers utilize strategies more than internal communication professionals. The reason is that companies no longer control information, and, as a result, the rise of social media requires such individuals to develop new strategies to influence the public (Rosengren 102).

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Communication plays a crucial role in business processes. However, business information acquired considerable significance for the past two decades that was triggered by technological advancements. The development affected social mediums of information and, consequently, both internal and external business relationships. Formerly, business leaders considered that much information or interactions with employees would damage the business. However, they later learned that it would be a tool to influence organizational performance and image. Thus, although organizational leaders perceived technological development as a considerable menace to business information, they employed strategies to improve the internal relationships with employees and build a positive public image of the business.

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