The Importance of Effective Communication for Business Expansion - Literature review Example

1. Introduction Communication is very important in today’s turbulent business environment. Although product knowledge and sales efficiency are crucial for organizations seeking to expand, this knowledge can be rendered useless if there is no clear understanding on what the organization seeks to achieve in the marketplace (Barker and Camarata 1998). Effective communication has become critical for businesses that wish to expand in the diverse and competitive environment. It is necessary for organizational members to understand and internalize the aspects of communication in ensuring more customer attraction, increased sales, stronger business relationship, enhanced professional image as well as steadier workflow. Effective communication is thus used as a tool to announce, explain or prepare individuals for change and preparing them for positive and negative effects of the impeding changes. The purpose of this report is to analyze and discuss the importance of both effective internal and external communication for business expansion. 2. Importance of effective communication Rizvi (2008) notes that the vision of expanding the business should be communicated effectively since it will be eventually translated into concrete actions by the organizational members. Effective communication also clarifies the future state of the organization in terms that are concrete and relevant for the organization participants at all levels as well as the customers and other stakeholders. The discussion of the importance of effective communication will be categorized into two parts: internal communication and external communication. 2.1. Effective internal communication According to Gillis and IABC (2011), internal communication is the communication process that takes place within the organization. While expanding the business, it is necessary to equip the employees with the intention of the expansion, new methods of operation through effective communication. This ensures easy adaptation to the changes that may occur during the process. The importance of effective internal communication include the preparation of the employees for changes, creating awareness and understanding among the employees, building and improving the vision of the organization, improving the psychological health of the organization, guiding and empowering the employees, and reinforcing organizational objectives. 2.1.1. Prepares employees for changes Business expansion result into various organizational changes, some of which may be threatening not only to the organization but to the employees as well. Procter and Douckens (2003) argue that such threatening changes may generate many emotions in individuals ranging from enthusiasm to cynicism, from fear to envy, or from energetic enjoyment to apathy. These unpredictable or unwelcome changes in the organization affects the way individual change their minds. Kitchen and Daily (2002) contend that the management needs to contain the employees’ emotions. Thus, they should understand and manage these emotions that they could be inevitably be aroused by the change through effective communication. In addition, they should help the employees to find effective ways of responding to the changes caused during the expansion process such as resistances and blockages. 2.1.2. Creates awareness and understanding among the employees During the expansion process, it is necessary to develop the employees in efforts of changing their attitudes, behavior and beliefs on the need to expand the business. Effective communication system would therefore create awareness and understanding which will foster the implementation of the new changes. According to Kitchen and Daily (2002), communication facilitates the understanding of those who adopt the new processes on what changes and why these changes are necessary for the organization. In addition, business expansion requires the employees to carefully apply their expertise so as to influence the design of that change. Effective communication will thus create the consciousness among the employees on how to change and manage the organizational culture and direct it towards the achievement of the expansion goals. 2.1.3. Building and improving the vision of the organization Business expansion requires the organization to enrich their vision with new ideas and make big leaps in gaining competitiveness in the industry. Effective communication will help in hijacking dull planning processes that could arise and licenses everyone to imagine vicious strategies that should be designed to increase their competitive advantage. The role of communication, here, is to build and improve the re-visioning process by encouraging the employees to think the unthinkable and thus making them to think outside the box and produce a vision that could be turned into strategy (Smythe 1996). 2.1.4. Improving the psychological health of the organization Real time communication of management decisions such as the expansion of a business require that the recipients get a clear, quick and honest reporting which will, in turn, lead to a quick implementation of the changes. Information that is quickly distributed throughout the organization improves the psychological health of the organization (Vallabhaneni 2009). Also, transparency in the messages increase the expected and achieved trust levels of the organizational members, which in turn increases their work involvement for the achievement of organizational goals. 2.1.5. Guiding and empowering employees Also, employee empowerment is regarded as a function of communication (Zahra et al 2001). Proper communication makes the employees not only to feel safe but also to appreciate their contribution in the organization. The role of management will therefore be guiding the employees to specify out ways of succeeding in the new markets by carrying their core values to the community. Management in today’s world devolve due to the expansion of businesses and thus moving into a more three dimensional type of management which relies heavily on the liberation and empowerment. However, this may cause a problem of swamping employees with different information. Krizan et al (2007) suggests the need to develop a new communication planning model that matches the information needs of the customers and those of the organization. This is essential in operating under the new business environment with totally different customers. 2.1.6. Reinforces the organizational objectives The adoption of strategic employee communication model helps in the understanding of the strategic role of effective communication for the success of organizations (Barrett 2002). He says that effective communication reinforces the objectives of the organization’s expansion objectives. It translates the expansion strategies to all members by allowing the communication channels to flow freely. Effective communication not only ensures information is tailored to the audience is relevant but it also renders it meaningful and consistent. Thus, expansion of a business division or unit requires that the messages delivered to the employees are converted into a digestible and achievable mode for them to understand and act upon. 2.2. Effective external communication Apart from internal communication, focus of effective external communication is also necessary. As the business expands, it has to reach out more customers and make them aware of the products and services they offer and convincingly give them a reason as to why they should buy them. According to Henderson and McAdam (2003) expansion of a business involves changes in the way the business is done as well as the change of management practices. Therefore, through effective communication, the managers can be able to identify new opportunities as well as constraints that may be imposed upon the organization in its new environment. The importance of effective external communication is discussed in the next section. 2.2.1. Creating ideal relations to the public Communication in an open, effective and honest manner promotes acceptance and greater understanding of diversity in organizations that enables the development of better concepts and structures which meet the customer demands. In this manner, the organization is able to create ideal relations to the public and determine what they real think, feel about the expansion efforts. Lievens, Moneart and Jegers (1999) argue that the quality of communication has a significant effect on the success of the new operations. Information flow assists in creating both realistic expectations to the consumers as well as awareness among users of their products and services. 2.2.2. Communicating to the customers If an organization wish to expand their business by bringing up new products and services to the market, their external communication efforts should be effective so as to create awareness among the potential customers. This enhances a successful diffusion of the products and services to the market (Kaye, 1995). Alternatively, a business may seek to expand by entering into new markets, an action that leads to change in the way the organization relate to its environment, particularly the customers. Actually, this affects the whole organization and may be quite uncertain over the outcomes (Kaye, 1995). Note that it is through effective external communication that the organization is able to announce their production methods, newly trained labor, changes in sales and marketing methods, new product design, new organizational structures and changes in finance. 2.2.3. Communicating realistic expectations The communication system of an organization can affect the customer expectations. Lievens et al (1999) say that the difference between the actual service delivery and the expectations that the external communication efforts creates is essential to the customer’s perception on service quality. The commercial sense of new products or services depends on the effectiveness of the communication system and therefore the organization should raise awareness on the successful launch of a new product or service that is realistic. Therefore, effective communication convinces the customers on the advantages of their products or services. 2.2.4. Simultaneity Lehman and Dufrene (2010) argue that the difficulty and complexity of managing customer/employee interface results into uncertainties related to the task characteristics such as inseparability of production and consumption. This requires a better integration of the functional interdependencies in the functional departments in reducing the degree of simultaneity. Rodriques (2002) proposes that both effective internal and external communication can help in reducing the risk perception among the employees and the customers. He also adds that effective communication fosters cooperation and participation among organizational members in handling the increased interdependencies among the functional departments 3. Conclusion Practically speaking, the process of business expansion requires information about its internal and external processes in order to ensure efficiency and effectiveness and respond and adapt to different actions respectively. This information must be put together in a coordinated way so that the decisions and actions that the organization makes matches its external circumstances. Effective communication during the expansion process ensures that there are ideal relationships created by the organization and the public, communicating to customers on new products or services as well as knowing their expectations. Focus on effective internal communication also prepares the organizational members for the impeding changes and empowering them in order to realize the organizational objectives during the expansion process. 4. 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