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Business Communication
BTEC Business
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Importance of Communication
• Communication is important because it is about how information is sent and received within firms
• The way information is communicated is often governed by how firms are structured
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Forms of Business Structure• Entrepreneurial - decisions made
centrally• Pyramid - staff have a role, shared
decision making, specialisation is possible• Matrix - staff with specific skills join
project teams, individuals have responsibility
• Independent - seen in professions where organisation provides support systems and little else
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Illustrating Structures 1
The Pyramid Traditional view of organisations
Decisions pass down formal channels from managers to staff
Information flows up formal channels from staff to management
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Illustrating Structures 2 Entrepreneurial
Most small businesses have this
structure
One or two people make
decisions
Great reliance on key workers
supporting decision makers
Quick to act but pressure on
decision makers
Decision maker
Key worker
Key worker
Key worker
Key worker
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Illustrating Structures 3
Matrix
Marketing Production Finance
Project A
Project teams created
Staff with specialist skills
Project B
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Illustrating Structures 4 Independent
Dr A Dr B
Dr CDr D
Support systems to professionals such as doctors
Not suited to most businesses due to
lack of control
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More on Business Structure
Centralisation• Managers keep
control• Decisions are made
in the interests of the whole business
• Costs can be cut by standardising purchasing and so on
• Strong leadership
Decentralisation• Empowering and
motivating• Freeing up senior
managers’ time• Better knowledge of
those closer to customers
• Good staff development
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Channels of Communication
• Communication in organisations follows paths or channels
• Communication between managers and subordinates is known as vertical communication
• This is because the information flows up or down the hierarchy
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Vertical/Lateral Communication
Organisation chart shows vertical (black arrows) and lateral (green arrows)
Finance Marketing Production
Board of Directors
Finance Officers
MarketingAssistants
FactoryOperatives
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Channels of Communication
• Channels between departments or functions involve lateral communication
• As well as formal channels of communication, information also passes through an organisation informally
• Communication is not complete until feedback has been received
