Communicating in Organizations

Whether an organization is large, small, or virtual, sharing information among its parts and with the outside world is the glue that binds the organization together. When you join a company such as Hallmark, you become a link in its information chain. Whether you're a top manager or an entry-level employee, you have information that others need to perform their jobs, and others have information that is crucial to you.

In a business with only five or six employees, much information can be exchanged casually and directly by phone, e-mail, fax, or interoffice memo. For example, Personalized Products, Inc. (PPI) produces souvenirs and toys for vacation spots such as Disney theme parks. PPI Sales Manager Tom Beatty used an interoffice memo to report first-quarter sales to PPI's vice president of finance (see Figure 1–3).

Figure 1–3	In-Depth Critique: Internal Communication by Memo

Giant organizations such as PepsiCo have hundreds of thousands of employees scattered around the world, and transmitting the right information to the right people at the right time is a real challenge. To meet this challenge, organizations rely on internal and external communication.

Internal communication refers to the exchange of information and ideas within an organization. Communication among the members of an organization is essential for effective functioning. As an employee, you are in a position to observe firsthand things that your supervisors and co-workers cannot see: a customer's first reaction to a product display, a supplier's brief hesitation before agreeing to a delivery date, an odd whirring noise in a piece of equipment, or a slowdown in the flow of customers. Managers and co-workers need these little gems of information in order to do their jobs. If you don't pass that information along, nobody will—because nobody else knows. Communicating freely helps employees develop a clear sense of the organization's mission and helps managers identify and react quickly to potential problems. To maintain a healthy flow of information within the organization, effective communicators use both formal and informal channels.

The formal communication network is typically shown as an organization chart such as the one in Figure 1–4. Such charts summarize the lines of authority; each box represents a link in the chain of command, and each line represents a formal channel for the transmission of official messages. Information may travel down, up, and across an organization's formal hierarchy.

Active Figure 1–4	Formal Communication

Formal organization charts illustrate how information is supposed to flow. In actual practice, however, lines and boxes on a piece of paper cannot prevent people from talking with one another.

•	Downward flow. Organizational decisions are usually made at the top and then flow down to the people who will carry them out. Most of what filters downward is geared toward helping employees do their jobs. From top to bottom, each person must understand each message, apply it, and pass it along.

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Upward flow. To solve problems and make intelligent decisions, managers must learn what's going on in the organization. Because they can't be everywhere at once, executives depend on lower-level employees to furnish them with accurate, timely reports on problems, emerging trends, opportunities for improvement, grievances, and performance.

•	Horizontal flow. Communication also flows from one department to another, either laterally or diagonally. This horizontal communication helps employees share information and coordinate tasks, and it is especially useful for solving complex and difficult problems.16

Every organization has an informal communication network—a grapevine—that supplements official channels. As people go about their work, they have casual conversations with their friends in the office. Although many of these conversations deal with personal matters, about 80 percent of the information that travels along the grapevine pertains to business.¹⁷

Some executives are wary of the informal communication network, possibly because it threatens their power to control the flow of information. However, savvy managers tap into the grapevine, using it to spread and receive informal messages.¹⁸ Because eliminating the grapevine is virtually impossible, sophisticated companies minimize its importance by making certain that the official word gets out.

Just as internal communication carries information up, down, and across the organization, external communication carries it into and out of the organization. Companies constantly exchange messages with customers, vendors, distributors, competitors, investors, journalists, and community representatives. Sometimes this external communication is carefully orchestrated—especially during a crisis. At other times it occurs informally as part of routine business operations.

Carefully constructed letters convey an important message to outsiders about the quality of your organization. For example, Montana's Save the Wolves Foundation seeks to raise funds for relocating wolves from other states into selected wilderness areas of Montana. To try to educate the public and garner support, the foundation communicates externally, sending a letter to representatives of the mass media (see Figure 1–5).

Figure 1–5	In-Depth Critique: External Communication by Letter

One important form of communication is the Internet. A company Web site can impart crucial information both inside the organization (using an intranet) and outside (via the Internet). Web sites can communicate a company's image to the outside world and a company's culture to employees.

Whether by letter, Web, phone, fax, or videotape, good communication is the first step in creating a favorable impression. Extremely careful planning is required for messages such as statements to the press, letters to investors, advertisements, price announcements, and litigation updates. Therefore, such documents are often drafted by a marketing or public relations team—a group of individuals whose sole job is creating and managing the flow of formal messages to outsiders.

One of the most visible tasks of professional business communicators is to help management plan for and respond to crises—which can range from environmental accidents or sabotage situations to strikes, massive product failure, major litigation, or even an abrupt change in management. To minimize the impact of any crisis, expert communicators advise managers to communicate honestly, openly, and often (see Table 1–1).¹⁹

Table 1–1

What to Do in a Crisis

When a Crisis Hits: Do Don't Do prepare for trouble ahead of time by identifying potential problems, appointing and training a response team, and preparing and testing a crisis management plan. Do get top management involved as soon as the crisis hits. Do set up a news center for company representatives and the media, equipped with phones, computers, and other electronic tools for preparing news releases. Issue at least two news updates a day, and have trained personnel on call to respond to questions around the clock. Provide complete information packets to the media as soon as possible. Prevent conflicting statements and provide continuity by appointing a single person, trained in advance, to speak for the company. Tell receptionists to direct all calls to the news center. Do tell the whole story—openly, completely, and honestly. If you are at fault, apologize. Do demonstrate the company's concern by your statements and your actions. Don't blame anyone for anything. Don't speculate in public. Don't refuse to answer questions. Don't release information that will violate anyone's right to privacy. Don't use the crisis to pitch products or services Don't play favorites with media representatives.

Although companies often communicate with outsiders in a formal manner, informal contacts with outsiders are important for learning about customer needs. As a member of an organization, you are an important informal conduit for communicating with the outside world. In the course of your daily activities, you unconsciously absorb bits and pieces of information that add to the collective knowledge of your company. What's more, every time you speak for or about your company, you send a message. Many outsiders may form their impression of your organization on the basis of the subtle, unconscious clues you transmit through your tone of voice, facial expression, and general appearance.

Top managers rely heavily on informal contacts with outsiders to exchange information that might be useful to their companies. Much of their networking involves interaction with fellow executives. However, plenty of high-level managers recognize the value of keeping in touch with "the real world" by creating opportunities to talk with and get feedback from customers and frontline employees. To facilitate this exchange of information, companies strive to minimize disruptions to the communication process. For the remainder of this chapter we will explain the communication process, the barriers that can block it, and how to overcome these barriers.