What is an effective business communication

Effective business communication

Effective business communication plays a vital role in every business organization. Ineffective communication can lead to confusion, misunderstanding, and even dissatisfaction. The worst scenario can be the loss of customers. A company can lose its customer if the message is not effectively communicated. But the question that arises here is “What’s business communication and the Importance of business communication.

Business communication is a process of communicating a message to someone within or outside an organization, in order to promote the company’s interest. 

Importance of business communication

Business communication is vital because it can make or break relationships. Effective communication between a business organization and its client can lead to making a good relationship. The company can retain customers for a longer period of time. Whereas, ineffective business communication can lead to the breaking of relationships with clients. Ineffective business communication results in disputes and ultimately results in financial loss for a business organization.

Impact of effective business communication

Effective communication is fruitful both internally and externally for an organization.

  • Communicating effectively leads to better employee productivity, thus resulting in high profits.
  • It results in decreasing the turnover rate for company.
  • It leads to happy customers and employees.
  • Effective business communication leads to a good reputation of the company in the market.

Now a question arises what makes communication more effective. How should we communicate effectively, so as to get good results?

Cost of ineffective business communication

Ineffective business communication can cost a business organization badly.

  • It results in severe financial loss for  business organization i.e. $420000/year for a business organization of 100 employees and  $62.4 million/year for a business of 100000 employees.
  • It results in conflicts between employees within a business organization.
  • Ineffective business communication results in high employee’s turnover.
  • Poor business communication also causes a lower contract renewal between a business organization and its client.
  • Ineffective business communication results in unhappy customers and clients.
  • It  attaches a bad image to the company.

5 basic elements of effective business communication


means how clearly we are communicating our message. An effective business should be clear to the receiver so that it is easily understood.


Effective business communication should be concise and simple.  Avoid unnecessary and ambiguous messages that lead to misunderstandings and conflicts.


An important element of business communication is propriety. It means the use of polite and respectful words and tone so that the audience/receiver feels respected.


Business communication should be strong enough to be credible and trustworthy. This helps a business organization gain respect and a good image in the market. A credible communication held gains customers loyalty.


  1. : An effective business communication is one which looks interesting and engaging to the audience.  A message or communication is consider to be engaging if it motivates employees, bring customers to finalize deals and converting potential customers.

In a nutshell, we can conclude that effective business communication is very important for a business organization. The more communication is effective, the more results will be fruitful. Business organizations cannot afford a poor communication channel both internally and externally. Apart from the business organization, effective communication is very important for individuals. Individuals need good communication for personal growth and promotion.


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