4 Important Types of Business Communication

Communication is vital to the success of any business. Effective communication brings clarity and creativity to every professional interaction, but ineffective communication can spell disaster for a company.  

Building an effective communication plan for your business can take time, but the first step is to understand the types of business communication: upward communication, downward communication, lateral communication, and external communication. 

Utilizing these communication styles within your business is important for achieving organizational goals, whether you are trying to increase sales, improve employee retention, or expand your team. Effective communication is the key to improving professional relationships between team members, leadership, and clients — with these relationships comes a world of opportunities. 

Upward Communication

As the name suggests, upward communication travels upwards through the chain of command within an organization. Employees report directly to managers, who may report directly to high-level company executives. This communication can include feedback forms, suggestion boxes, employee surveys, staff-led meetings, and one-on-ones. 

Upward communication helps leaders tap into the lived experiences of their staff, receive feedback on company practices, and build open and honest relationships in the workplace.  

Enhancing Upward Communication

When employees are encouraged to communicate directly with their supervisors, there are positive shifts in the company’s culture. Upward communication brings many benefits in corporate environments, including 

• Improving morale;
• Creating a friendly culture;
• Encouraging feedback and employee insight.

Open upward communication can be a powerful tool for improving employee retention. When your current team is empowered to communicate their ideas, struggles, and feedback, they may feel motivated to help reach team goals and grow their individual skill sets. Some strategies for enhancing open communication in the workplace include: 

• Anonymous communication tools: Employee feedback forms and suggestion boxes provide a stress-free way for employees to communicate with management.
• Open-door policies: Setting policies that invite employees to communicate with their managers is a great way to improve upward communication.
• Feedback sessions: Set specific meetings for feedback and communication with team members.

Introducing these strategies to the workplace provides team members with new ways to communicate with leadership, and can help the company grow with powerful insight from the staff who are working each day to build it. 

Downward Communication

Upward communication provides many benefits within organizations, but communication can flow both ways through the organizational hierarchy. Downward communication is created when leaders communicate directly with staff. 

For example, an executive can talk to a manager about a new project and the attached expectations. Following their conversation, the manager speaks with staff about the project, sends memos delegating specific tasks within the project, and monitors performance concerning the executive’s expectations. 

As shown in this example, downward communication, through in-person meetings, memos, newsletters, or policy documents, is a valuable tool for setting expectations and providing instructions within an organization.  

Enhancing Downward Communication

Downward communication is a key tool for turning company goals into reality, but it is important to understand the challenges that come with this type of communication: confusion and information overload. 

As you communicate with your team, prioritize clear messaging. Stop sugarcoating difficult conversations. Instead, provide written documentation for new projects and policies and ask follow-up questions. Taking these steps can help you to avoid confusion within your company. 

Another way to enhance downward communication is by limiting information overload. Using multiple communication channels, when done properly, is one way to avoid this kind of overload. These channels include: 

• Email: Formal communication that requires a large amount of text and information is best shared in email. This allows team members to see your expectations in writing and take their time when processing, planning, and responding.
• Video conferencing: If you are interested in inviting immediate feedback and collaboration after setting expectations with your team, consider using video conferencing tools.
• Instant messaging: Instant messaging is best used for check-ins and minor updates. Avoid sending the same information via instant messaging that you send through email.

Communicating clearly and through the proper channels helps your team to meet expectations with minimal stress and delay. 

Lateral Communication

Lateral communication, also known as horizontal communication, is communication between team members or employees in other departments within a company. This type of communication is necessary for problem-solving, creative thinking, and coordination between peers. 

Interdepartmental meetings, project teams, and collaboration platforms all invite lateral communication. 

Enhancing Lateral Communication

Lateral communication fosters collaboration and creativity within the workplace. By encouraging your employees to communicate with their peers, you can boost morale and prevent silos and communication blocks within your organization. 

There are many ways to promote lateral communication within your company, including team-building activities and interdepartmental projects. These methods create spaces where collaboration and lateral communication are encouraged — both short-term and long-term. 

External Communication

Your company does not exist in isolation. Your relationships with other organizations, clients, consumers, and communities help your company grow and achieve its organizational goals. External communication, the ways a company interacts with outside individuals and organizations, has a strong impact on a business’s reputation and access to new opportunities. 

External communication, such as press releases, social media, marketing materials, and customer service, is the way that your company grows and reaches your ideal market. 

Enhancing External Communication

When developing company communication strategies, start by establishing a consistent voice that matches your branding and the type of communication you are using. Understand your target audience and your chosen platform before sending out external communications. 

One of the most powerful tools for external communication is social media. According to a study published in 2020 by the International Journal of Operations and Production Management, increased social media usage results in higher reputation scores. Building a consistent, engaging social media presence helps companies to connect directly with consumers and build a strong, positive reputation. 

Implementing Effective Communication Strategies Across Your Organization

Upward, downward, lateral, and external — each type of communication brings its own benefits and challenges. Creating a comprehensive communication strategy that incorporates all four types is essential for leading a company into the future. 

Leaders are responsible for fostering an environment where each of these types of communication happens simultaneously and successfully. Leaders are also responsible for understanding the benefits and challenges of adopting new company policies, especially when establishing communication policies.  

Enhancing Communication with Technology

As you step forward in the process of building an open and communicative company culture, consider hosting regular training and workshops to improve communication skills at every level of your organization. Once you have established these skills, digital tools such as field service software, route management software, and resource planning software can facilitate effective team management and downward communication. 

Utilizing these software programs and introducing internal communication platforms can help facilitate effective leadership and clear communication. Additionally, developing social media policies surrounding issues of brand image, digital security, and employee conduct is an important step in enhancing communication with technological tools.  

Adopting a new communication strategy for your company may seem like a daunting task, but some tools and methods can help.