1. Communication Defined:
Communication is a process of exchanging verbal
and non verbal messages.
It is a continuous process.
Message must be conveyed through some medium to
the recipient, and is essential that this message must
be understood by the recipient in same terms as
intended by the sender.
Thus, communication is a two way process and is
incomplete without a feedback from the recipient to
the sender on how well the message is understood by
Effective Communication is significant for
managers in the organizations so as to
perform the basic functions of management,
i.e., Planning, Organizing, Leading and
Communication helps managers to perform
their jobs and responsibilities.
Communication serves as a foundation for
3. Importance of Communication in an
Organizing also requires effective communication
with others about their job task.
Controlling is not possible without written and oral
Thus, we can say that “effective
communication is a building block of
successful organizations”. In other words,
communication acts as organizational blood.
4. Importance of Communication in an
Communication promotes motivation by
informing and clarifying the employees about the
task to be done, the manner they are performing the
task, and how to improve their performance if it is
not up to the mark.
Communication is a source of information to the
organizational members for decision-making process
as it helps identifying and assessing alternative
course of actions.
Communication also plays a crucial role in altering
individual’s attitudes, i.e., a well informed
individual will have better attitude than a less-
5. Importance of Communication in an
Communication also helps in socializing. In
today’s life the only presence of another individual
fosters communication. It is also said that one
cannot survive without communication.
Communication also assists in controlling
process. It helps controlling organizational
member’s behaviour in various ways. There are
various levels of hierarchy and certain principles and
guidelines that employees must follow in an
organization. They must comply with organizational
policies, perform their job role efficiently and
communicate any work problem and grievance to
their superiors. Thus, communication helps in
controlling function of management. 10/14/2012
6. Main Components of Communication
1. Context - Communication is affected by the
context in which it takes place. This context may
be physical, social, chronological or cultural.
Every communication proceeds with context.
2. Sender / Encoder - Sender / Encoder is a
person who sends the message. A sender makes
use of symbols (words or graphic or visual aids)
to convey the message and produce the required
7. Main Components of Communication
3. Message - Message is a key idea that the sender
wants to communicate. It is a sign that elicits the
response of recipient. Communication process
begins with deciding about the message to be
conveyed. It must be ensured that the main objective
of the message is clear.
4. Medium - Medium is a means used to exchange /
transmit the message. The sender must choose an
appropriate medium for transmitting the message
else the message might not be conveyed to the
8. Main Components of Communication
5. Recipient / Decoder - Recipient / Decoder is a person
for whom the message is intended / aimed / targeted.
The degree to which the decoder understands the
message is dependent upon various factors such as
knowledge of recipient, their responsiveness to the
message, and the reliance of encoder on decoder.
6. Feedback - Feedback is the main component of
communication process as it permits the sender to
analyze the efficacy of the message. It helps the sender in
confirming the correct interpretation of message by the
decoder. Feedback may be verbal (through words) or
non-verbal (in form of smiles, sighs, etc.). It may take
written form also in form of memos, reports, etc.
9. In an organization, communication flows in 5
10. Downward Flow of Communication
Communication that flows from a higher level in an
organization to a lower level is a downward
Downward communication is used by the managers for
the following purposes -
1. Providing feedback on employees performance;
2. Giving job instructions;
3. Providing a complete understanding of the employees
job as well as to communicate them how their job is
related to other jobs in the organization;
4. Communicating the organization’s mission and vision
to the employees; and
5. Highlighting the areas of attention.
11. Upward Flow of Communication
• Communication that flows to a higher level in an
organization is called upward communication. It
provides feedback on how well the organization is
functioning. The subordinates use upward
communication to convey their problems and
performances to their superiors.
• Grievance Redressal System, Complaint and
Suggestion Box, Job Satisfaction surveys, etc., all help
in improving upward communication. Other examples
of Upward Communication are -performance reports
made by low level management for reviewing by higher
level management, employee attitude surveys, letters
from employees, employee-manager discussions etc.
12. Lateral/Horizontal Communication
- Communication that takes place at same levels of
hierarchy in an organization is called lateral
communication, i.e., communication between peers,
between managers at same levels or between any
horizontally equivalent organizational member. The
advantages of horizontal communication are as follows:
It is time saving;
It facilitates coordination of the task;
It facilitates cooperation among team members;
It provides emotional and social assistance to the
It helps in solving various organizational problems;
It is a means of information sharing; and
It can also be used for resolving conflicts of a department
with other department or conflicts within a department.
13. Diagonal Communication
> Communication that takes place between a
manager and employees of other
workgroups is called diagonal
communication. It generally does not appear
on organizational chart. For instance - To
design a training module a training manager
interacts with Operation personnel to
inquire about the way they perform their
14. External Communication
> Communication that takes place between a
manager and external groups such as -
suppliers, vendors, banks, financial
institutes, etc. For instance - To raise capital
the Managing director would interact with
the Bank Manager.
15. Feedback Communication
Feedback is essential in communication so as to
know whether the recipient has understood the
message in the same terms as intended by the
sender and whether he agrees to that message or
There are lot of ways in which company takes
feedback from their employees, such as : Employee
surveys, memos, emails, open-door policies,
company news letter, etc
16. Communication Barriers
Communication is a process beginning with a sender
who encodes the message and passes it through
some channel to the receiver who decodes the
Communication is fruitful if and only if the messages
sent by the sender are interpreted with same
meaning by the receiver. If any kind of disturbance
blocks any step of communication, the message will
be destroyed. Due to such disturbances, managers in
an organization face severe problems. Thus, the
managers must locate such barriers and take steps to
get rid of them.
17. Following are the main communication
Perceptual and Language Differences
Complexity in Organizational
19. Power and Authority Relations
Delegation of Authority - means division of
authority and powers downwards to the
subordinate. Delegation is about entrusting
someone else to do parts of your job. Delegation of
authority can be defined as subdivision and sub-
allocation of powers to the subordinates in order to
achieve effective results.
Elements of Delegation: Authority, Responsibility,
20. Steps for Achieving Delegation
1. Assignment of Duties - The delegator first tries to
define the task and duties to the subordinate.
2. Granting of authority - Subdivision of authority
takes place when a superior divides and shares his
authority with the subordinate.
3. Creating Responsibility and Accountability -
The delegation process does not end once powers are
granted to the subordinates. They at the same time have
to be obligatory towards the duties assigned to them.
Responsibility is said to be the factor or obligation of an
individual to carry out his duties in best of his ability as
per the directions of superior. Responsibility is very
important. Therefore, it is that which gives effectiveness
21. Relationship between Authority and
It is the legal right of a person or a It is the obligation of subordinate
superior to command his to perform the work assigned to
Authority is attached to the Responsibility arises out of
position of a superior in concern. superior-subordinate relationship
in which subordinate agrees to
carry out duty given to him.
Authority can be delegated by a Responsibility cannot be shifted
superior to a subordinate and is absolute
It flows from top to bottom. It flows from bottom to top.
22. Authority vs. Leadership
The authority exercised is a kind of legitimate power
and people follow figures exercising it, because their
positions demand so irrespective of the person
holding the position.
Leaders in organizations and elsewhere may
have formal authorities but they mostly rely
on the informal authority that they exercise
on people to influence them. Leaders are trusted
for their judgment and respected for their expertise,
integrity, etc., and hence followed and not because
they hold a certain position.
23. Authority vs. Leadership
Formal authority and power emerging from
being a leader, might not always be able to
influence people in the desired manner as; in times
of crisis and difficulties, people view it as coercion;
while leadership tends to create followers out of
free will and choice without forcing them to accept
anything thrown their way.
Authority rarely provides a scope for feedback,
constructive criticism or opinions of the people on
whom it is exercised however leaders provide
ample platform to their followers to voice their
thoughts and feedback.
24. Authority vs. Leadership
Authority can hardly make people change their
attitudes and behaviors with lasting effects and
results however a leader inspires followers through
self modelled ways and hence leadership displays
greater effectiveness in addressing attitudes and
behaviors of people.
Exercising authority sometimes limits the
approaches to arrive at solutions for issues and
problems while leadership encourages people to
look beyond the obvious and think innovatively and
sometimes emerge with radical solutions.
25. Authority vs. Leadership
Apart from it, the biggest difference between the two
as cited by Stephen R. Covey is the moral
authority held by leaders over the followers which
is absent in the case of power from authority. Within
the organizational setup when leaders also have
moral authority on their subordinates by
establishing a synchrony in their words and actions;
the rest of the structure and processes of the
organization also get aligned to it, thus creating a
robust and transparent culture.
26. Centralization and Decentralization
Centralization is said to be a process where the
concentration of decision making is in a few hands. All
the important decision and actions at the lower level, all
subjects and actions at the lower level are subject to the
approval of top management. According to Allen,
“Centralization” is the systematic and consistent
reservation of authority at central points in the
organization. The implication of centralization can be :-
1. Reservation of decision making power at top level.
2. Reservation of operating authority with the middle
3. Reservation of operation at lower level at the
directions of the top level.
27. Centralization and Decentralization
Decentralization is a systematic delegation of
authority at all levels of management and in all of the
organization. In a decentralization concern, authority is
retained by the top management for taking major
decisions and framing policies concerning the whole
concern. Rest of the authority may be delegated to the
middle level and lower level of management.
• The degree of centralization and
decentralization will depend upon the amount of
authority delegated to the lowest level. According to
Allen, “Decentralization refers to the systematic effort to
delegate to the lowest level of authority except that which
can be controlled and exercised at central points.
28. Implications of Decentralization
1. There is less burden on the Chief Executive as in
the case of centralization.
2. In decentralization, the subordinates get a chance
to decide and act independently which develops
skills and capabilities. This way the organization is
able to process reserve of talents in it.
3. In decentralization, diversification and horizontal
can be easily implanted.
4. In decentralization, concern diversification of
activities can place effectively since there is more
scope for creating new departments. Therefore,
diversification growth is of a degree.
29. Implications of Decentralization
In decentralization structure, operations can be coordinated
at divisional level which is not possible in the centralization
In the case of decentralization structure, there is greater
motivation and morale of the employees since they get more
independence to act and decide.
In a decentralization structure, co-ordination to some extent
is difficult to maintain as there are lot many department
divisions and authority is delegated to maximum possible
extent, i.e., to the bottom most level delegation reaches.
Centralization and decentralization are the categories by
which the pattern of authority relationships became clear. The
degree of centralization and de-centralization can be affected
by many factors like nature of operation, volume of profits,
number of departments, size of a concern, etc. The larger the
size of a concern, a decentralization set up is suitable in it.