Forms of Communication at Fonterra Dairies New Zealand - Case Study Example

Running Header: Fonterra Dairies New Zealand Student’s Name: Instructor’s Name: Course Name & Code: Submission Date: Table of Contents Table of Contents 2 Introduction 3 Forms of Communication at Fonterra Dairies 3 Feedback in measuring communication 8 Informal Communication at Fonterra Dairies 10 Conclusion 11 References 13 Introduction According to Wood, Zeffane, Fromholtz & Fitzgerald, (2006), people communicate using various forms to each other depending on the type of message that is intended to be delivered or conveyed and the context in which it is to be sent. Communication may be one way or two ways. One way is characterized by lack of feedback from the receiver to the sender. Two ways communication involves active feedback from the receiver of the information after the communication becomes effective and accurate to him from sender. This form of communication is more interactive and interpersonal with more mutual understanding. However, it is important to take into account that feedback cannot be relied upon as the method of determining whether the communication has been accurate and complete. Therefore, there is the need for using other means of determining the accuracy and completeness of communication such as questionnaires and interviews. At Fonterra as illustrated by Roderic, (2008), feedback is significantly utilized in determining whether the communication has been complete and accurate. According to this report, there has been extensive utilization of formal communication at Fonterra with quite little use of informal communication. Among the formal communication methods used include regular field briefings, monthly magazines, website or internet, updated letters, annual briefings, annual reports, annual general meetings, among others. Website has been one of the most effective forms of communication at Fonterra’s. Forms of Communication at Fonterra Dairies According to Phillips & Brown, (1993), communication is a process of conveying information between different areas of an organization. Communication is one of the main functions of Fonterra management in its activities. Communication is the process of transmitting information, thoughts, ideas, opinions, and plans between various areas of an organization. Human relations are only possible when communication is effective between all stakeholders of Fonterra. Fonterra has over 13000 cooperative shareholders farmers, and 29 manufacturing sites in New Zealand. Therefore, effective communication channels with staff, suppliers or customers. Fonterra’s communication success lies in practical applications of key concepts in management communication theory. At Fonterra, they are various forms of communication that are utilized to ensure there are effective forms of communication between the organization’s management, shareholders, and staffs as illustrated by OECD, (2002). This form of communication usually follows a prescribed patterns illustrated by the organization chart. At Fonterra, there is open and honest form of communication where there is efficient exchange of ideas. Feedback to all stakeholders is of great concern while emphasizing on openness to feedback. This communication has played a great role of ensuring effective feedbacks are utilized in ensuring the organization is able to expand and grow while satisfying all the involved stakeholders according to Eunson, (2005). Communication with feedback is crucial towards ensuring the weak areas of organization performance are corrected. The other form of communication that Fonterra utilizes is two-way communication which is formal in that procedures are followed along the lines of authority established by management. This is in its efforts to recognize new and special ideas from its staff and suppliers. These ideas through communication play a great role in ensuring the company remains innovative and effective. There is direct communication between stakeholders and management of Fonterra. This plays a great role in ensuring that any bottlenecks to effective performance or productivity are eliminated. The mostly used form of communication at Fonterra is formal. This communication takes place through Formal channels of the structure of the organization established by management of Fonterra. This form of communication assists in maintaining the authority relationship of an organization as illustrated by Anonymous, (2005). Campling, (2008) argues that forms of communication utilized at Fonterra are formal and includes regular field briefings, monthly magazines, website or internet, updated letters, annual briefings, annual reports, director’s road shows on environmental issues and milk pricing, annual general meeting in nine venues servicing the farmers, and regular district meetings. Regular field briefings are one form of communication where farmers and other involved stakeholders are informed on the ongoing field activities and the expected results from them. This form of communication informs and updates the Fonterra’s stakeholders on what is happening. It also expects some feedback from the suppliers and customers on the areas that require improvements. Monthly magazines are another form of communication whereby Fonterra Company publishes magazines and journals for its staff, suppliers, and customers. This keeps staffs, suppliers, and customers updated about the latest business developments, activities conducted in the company including various achievements by the varying departments such as sales, marketing, and production. Management communicates to all stakeholders through this magazine and journals where they convey their messages through them. These have been utilized fully at Fonterra as a means of communication to all those related to the Company. According to Fonterra Co-operative Group (2011), Fonterra Company has website (www.fonterra.com) which is used as a form of communication to all the farmers who can be able to access the internet. Information communicated through the website includes financial results, shareholder information, corporate governance, and products among others. Thomas, (2002) argues that Website is the best form of communication especially when the entire involved are able to access it. Updated letters are also sent to farmers in various regions to the suppliers and customers. Fonterra sends updated letters to inform their stakeholders on the urgent changes that have occurred within a small time span. Such are the most sensitive issues that involve the company and that may require feedbacks from the involved stakeholders. Updated letters have become effective forms of communication to the stakeholders. Annual briefings are form of communication utilized by Fonterra to brief stakeholders on various issues regarding the activities of the company. This briefing is usually the message from the chairman of the board that he conveys to all stakeholders. Annual briefings communication may be in form of internet or website, journals or magazines or during the meetings. Annual briefings are usually accompanied by annual reports of the company. Annual report is another form of communication that communicates to the stakeholders of Fonterra and public on details concerning expenses, income, profits and income distribution while giving financial standing of Fonterra. Annual reports are usually sent to stakeholders as well as being published in the internet. This form of communication only delivers message of financial position of the company with less details on the other activities of Fonterra. Another form of communication is the director’s road show. This is used to inform the stakeholders on milk pricing and environmental issues. This form of communication is effective as it gives a chance to stakeholders to give their views or feedback concerning the milk prices. They are able to negotiate and reach a conclusion concerning the prices. Matters concerning environment are also communicated to the stakeholders of the companies. Road shows are appropriate as it attracts attention of people on roads hence they are very influential forms of communication to the public used by Fonterra. Another form of communication in Fonterra Company is through regular district meetings with members of shareholders’ executive. These are meetings where management and executive shareholders become more open to each other. This form of communication intends to reveal any form of problems that the Fonterra Company may be facing as well as other issues that may be affecting it and does not need to be revealed to all shareholders and stakeholders or public. This usually addresses the issues affecting farmers and customers in their respective districts or areas. The last form of communication used at Fonterra is annual general meeting. This is where the involved stakeholders including farmers or suppliers, shareholders, management, and staff. Annual general meeting in Fonterra is a two way communication for shareholders in discussing major issues verbally. The general meeting is televised to nine venues servicing Fonterra farmers in order to update them on the meetings proceedings. The general meeting usually provides a two way communication where farmers and other stakeholders are given a chance to give and express their ideas to management. Problems facing the company are as well addressed. This form of communication is crucial as every stakeholder is able to express and elaborate the problems facing the Fonterra. All grievances facing farmers/suppliers, customers, and shareholders are addressed during the general meetings of Fonterra. There are some best forms of communication that are utilized at Fonterra. One of such form of communication is through the internet or website (www.fonterra.com) as illustrated by Fonterra Co-operative Group (2011). Website updates farmers and other stakeholders instantly on any issue that arises as well as current market reports. It is the best form of communicating with the stakeholders because all information concerning Fonterra is posted such as financial results, shareholders information, products, investments, and other relevant information. Website also provides a chance for any stakeholder to give his feedbacks to the company. Farmers have a chance of logging in and viewing any information and posting their suggestion on issues affecting them. This form of communication has been effective for Fonterra to such an extent that it is improving farmer’s internet access in rural areas. Fonterra is working with Telecom to provide ADSL modems, and wireless and satellite technology in order to enable farmers’ access internet as illustrated by Davidson, (2009). Therefore, website is the best form of communication at Fonterra Company. Feedback in measuring communication According to Hoover’s (2007), feedback is the message conveyed back after the intended communication or information goes through. It is an indication of whether the information or communication has been well received or gotten by the intended audience. Feedback in most instances assists in evaluating whether the form of communication being used is making targeted people receive intended information. However, it is important to note that listening to feedback alone cannot be used as a measure of how communication is accurate and complete. It is crucial for the organizations to use other available measures of determining the accuracy and completeness of the communication. Such means may include questionnaires and interview to the involved people in conjunction with feedback according to Graf, (2004). These questionnaires may be used on people who include farmers, staffs, and other stakeholders of Fonterra. This may be a better way of determining the accuracy and completeness of communication. Feedbacks may just be from few individuals other than the entire people involved. Some people may even lack time or interest to send their feedback hence difficult to determine whether the communication was complete. Some people are extremely dormant to an extent of not being interested to respond. Therefore, when such a group of people form the largest part of the company’s audience, it may be difficult for the company to obtain accurate feedback from them hence the need of incorporating other means. Listening to feedback may also be insufficient because some people do not have enough courage to express their views especially in the presence of a large group of people especially in meeting. These may end up not giving any feedback as it may be expected from them. Some of the issues may be too satisfying to an extent that the involved audience may not see the need addressing it again or give back any feedback. Some people stay quite when they become satisfied with the information they get hence it may become difficult to assess whether the communication is accurate and complete hence the need for other methods. Some of the people willing to give back the feedback may lack means of expressing their ideas or giving back their feedback. Therefore, this cannot be relied upon to measure the accuracy and completeness of the communication. According to Business Review Weekly (2006), it is important to get deep into the people and listen to their views in order to determine how deep and effective the communication was able to go through. Organizations that rely on the feedback to determine the accuracy and completeness of their information don’t get accurate results. Therefore, there is need to involve other means possible other than feedback only. Such include questionnaires and interviews with the concerned groups. It is important for Fonterra to adopt appropriate methods of determining how effective, accurate, and completeness of their communication is other than relying on feedback alone. Informal Communication at Fonterra Dairies Katherine, (2008) illustrates that informal communication is when communication deviates from the planned communication structure leaving out people in the communication line. In informal communication, information is shared without formally imposed restrictions or obligations. Informal Medias of communications include face-to-face discussions. Informal communications have no formal opening or closing with conversations lasting only for a few minutes between the involved people audiences. This informal communication arises because of personal needs of the members of the organization. It is difficult to fix responsibility about accuracy of information with such communication being oral. In most instances it is build around the social relationship of organization members. However, despite extensive utilization of formal method of communication at Fonterra, there are still some aspects of informal communication within this company. According to Davidson, (2009), Fonterra second CEO is usually involved in informal communication with shareholders when they meet on the roads and other informal areas. Their meeting are not usually planned or arranged but he just finds himself communicating or talking to the shareholders. He at one moment said that he directly talks with the Fonterra’s shareholders in un-expecting manner. Such is an example of how informal communication is carried out with Fonterra although it is incomparable to the formal communication that is used most of the time. Although most leaders of the organizations do not entertain informal communication, CEO of Fonterra, Andrew Ferrier is found to involve himself very much especially when he is on field trips or during his own free time. Conclusion According to Australian Society of Dairy Technology (2001), communication plays a great role in every organization throughout the world in ensuring that the intended information is conveyed from one area to intended people or audience. It is crucial for Fonterra to utilize significantly all forms of communication available in order to ensure that intended communication is delivered accordingly. It is important to note that formal communication has been greatly utilized at Fonterra through meetings, update letters and annual reports. Although formal communication is used by most organizations, it has some disadvantages such being time consuming, cumbersome, and leads to a good deal of distortion at times. Informal communication has also been practiced at Fonterra by the CEO, Andrew Ferrier as he talks with shareholders by the roads. However, all forms of communication are intended to convey the message to the involved shareholders, farmers, consumers, and suppliers. Fonterra management should ensure its website is accessible to all farmers and other stakeholders in order to enhance communication between them and the company. Website provides a good platform for people to give feedback as they read news and other recent information posted in the website. Therefore, it is important for Fonterra management to use all the available resources in collaboration with companies like Telecom to ensure every farmer or stakeholder is able to access internet in order to enhance the communication. They are several ways of determining whether communication has become accurate and complete. However, it is not recommendable for Fonterra management not to rely on feedback only as a means of measuring the accuracy and correctness of communication to the farmers or suppliers, staff, customers, and shareholders. It is important to use other means such as questionnaires and interviews. References Anonymous 2005, ‘Providing feedback opportunities’, Strategic Communication Management, vol. 10, no. 1, pp. 4-7. Australian Society of Dairy Technology 2001, ‘The Australian journal of dairy technology, Volumes 56-61’, Journal of dairy technology, vol. 56, no. 5, pp. 78-102. Business Review Weekly 2006, ‘Business Review’, Journal of Business Review, vol. 28, no. 43, pp. 54-69. Campling, et el, 2008, Management, John Wiley & Sons, Brisbane. Davidson, et al. 2009, Management: Core Concepts and Applications, 2nd edition, Wiley, Brisbane. Eunson, B 2005, Communicating in the 21st century, John Wiley & Sons, Brisbane. Fonterra Co-operative Group 2011, Fonterra: Dairy for life, viewed 28 January 2011, http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com Graf, A 2004, ‘Expatriate selection: An empirical study identifying significant skill profiles’, Thunderbird International Business Review, vol. 46, no. 6, pp. 667-85. Hoover’s 2007, Hoover’s Handbook of World Business 2007, Hoover’s, University of California. Katherine, M 2008, Organizational communication: approaches and processes, Cengage Learning, London. OECD 2002, Global Trends in the Dairy Industry: Outlook for the Baltics, OECD Publishing, Michigan. Phillips, N. & Brown, J 1993, ‘Analyzing communications in and around the organizations: a critical hermeneutic approach’, Academy of Management Journal, vol. 36, no. 6, pp. 1547-76. Roderic, A 2008, New Zealand in World Affairs IV 1990-2005, Victoria University Press, Sydney. Thomas, E 2002, Applied organizational communication: principles and pragmatics for future practice, Routledge, New York. Wood, J., Zeffane, R., Fromholtz, M. & Fitzgerald, A. 2006, Organizational Behaviour: Core Concepts and Applications, John Wiley & Sons, Brisbane. Read More