Business Studies (0450) | Internal and external communication

✅ IGCSE Business Studies (0450) Study Notes: Internal and External Communication

Hello future business leader! This chapter is all about how successful enterprises talk to the world and, more importantly, how they talk to themselves. Communication is not just typing an email; it’s making sure the right message gets to the right person, in the right way, so that everyone can work together effectively.

Think of your enterprise project: whether you are talking to your team (Internal) or negotiating with a supplier (External), clear communication is the difference between success and a total muddle!

---

1. The Basics: Types of Communication (Syllabus 10.1)

Communication can be sorted into two main pairs. We need to understand when and why we use each one.

Formal vs. Informal Communication

The main difference here is the **structure** and the **audience**.

● Formal Communication

This is official, structured, and usually recorded. We use it when we need accuracy and professionalism.
Why we use it:

• When the message is very important (e.g., legal contracts or financial figures).
• When we need a permanent record (like proof of a decision).
• When communicating with high-level external stakeholders (like banks or the government).

Examples: ➤ Writing a formal report for investors.
➤ Sending a registered business letter to a supplier.
➤ A scheduled, recorded board meeting.

● Informal Communication

This is casual, relaxed, and often spontaneous. It helps build good relationships and speeds up simple tasks.
Why we use it:

• To build team morale and social connections.
• For quick, simple questions or feedback.
• When the audience is familiar (like close colleagues).

Examples: ➤ Talking to a friend at lunch about work.
➤ A quick call to an employee asking about their weekend.
➤ Sending a text message to a team member (unless company policy forbids it!).

❖ Did you know? Even though informal communication is fast, it can lead to confusion because details might be missed or rumours might start. This is sometimes called the "grapevine" communication network.

Verbal vs. Non-Verbal Communication

● Verbal Communication

This involves the use of **words**—either written or spoken.

• Spoken (Oral): Meetings, phone calls, presentations. Advantage: Instant feedback.
• Written: Emails, letters, reports, memos. Advantage: Provides a clear record.

● Non-Verbal Communication

This is communication without using words. It often tells the real story, even if the verbal message is different.
Key examples include:

• Body language: Posture, gestures, eye contact (e.g., folding your arms can signal defensiveness).
• Facial expressions: Smiling, frowning.
• Tone of voice: The way you say something (e.g., sarcasm changes the meaning entirely).

❖ Tip for Exams: If a manager says "The project is fine" (verbal), but they are frowning and avoiding eye contact (non-verbal), the true message being communicated is often the non-verbal one (that the project is *not* fine). Always consider both in face-to-face situations!

---

2. Communication with Stakeholders (Syllabus 10.1 continued)

An enterprise communicates for different reasons depending on who the audience is. We divide the audience into two groups: Internal (inside the business) and External (outside the business).

Internal Stakeholders

These people work for, or own, the enterprise.

● Managers: Need information on performance, employee issues, and budgets. Communication often involves formal reports, memos, and management meetings.

● Employees: Need instructions, motivation, and feedback. Communication is usually through memos, training sessions, team meetings, and informal chats.

● Shareholders / Owners: Need to know how the business is doing financially. Communication must be very formal, using financial statements, annual reports, and formal meetings.

External Stakeholders

These people are outside the business but are affected by it.

● Customers: Need information about products, prices, and services. Communication uses marketing materials, websites, customer service calls, and social media.

● Suppliers: Need clear information on orders, delivery times, and payment schedules. Communication involves formal purchase orders, detailed emails, and possibly negotiations.

● Banks / Lenders: Need assurance that the business is financially stable. Communication requires highly formal documents, such as financial reports, loan proposals, and face-to-face presentations.

● Local Community: Needs to know about job openings, environmental impact, or upcoming developments. Communication might use press releases, local announcements, or community meetings.

● Local Government: Needs information for legal compliance, tax, and planning. Communication is strictly formal, involving written reports and legal documents.

---

3. Effective Meetings and Presentations (Syllabus 10.2)

Formal meetings and presentations are key methods for communicating complex information to groups of stakeholders. Success relies heavily on preparation.

Step-by-Step Guide to Planning a Meeting

Careful planning ensures the meeting achieves its **clear focus** and saves valuable time.

● Step 1: Planning (Before the Event)

This ensures everyone knows what to expect and what to prepare.
Key Planning points:

• Set the **objective**: What must be decided or achieved?
• Decide who needs to attend (and why).
• Prepare the Notice of Meeting (who, when, where, and what time to arrive).
• Prepare the Agenda (a list of topics to be discussed, usually in order).

● Step 2: During the Meeting

The job of the chairperson is to manage the flow and ensure everyone has an opportunity to speak.
Execution points:

• Start and finish on time (keeping to time).
• Keep the discussion focused on the agenda items.
• Ensure decisions are clearly stated.
• A secretary should record the discussion and decisions in the Minutes.

● Step 3: Evaluation (After the Event)

This checks if the communication was successful and objectives were achieved (a key analysis skill!).
Evaluation points:

• Did the decisions made achieve the original objectives?
• What went well (e.g., everyone was prepared)?
• How can we improve the next meeting (e.g., fewer topics on the agenda)?
• Distribute the Minutes so everyone knows the official outcome.

Documents for Formal Meetings

These documents are essential for structure and legal record:

1. Notice of Meeting: The formal invitation. It tells attendees the date, time, and location.
2. Agenda: The "to-do list" for the meeting. It outlines the topics and their order.
3. Minutes: The official record of the meeting. They list who attended, what was discussed, the decisions made, and who is responsible for follow-up actions.

Presentations

When presenting, you need to deliver information clearly and persuasively (especially useful when pitching your enterprise idea or reporting back to investors).

Key Documents / Aids:

● Visual Aids: Tools like PowerPoint slides, charts, or product demonstrations. They make complex information easier to understand and remember.
● Handouts: Documents given to the audience (usually containing key data, summaries, or contact information) for them to take away and review later.
● Formal Report: Often used to back up the presentation, providing all the detailed financial or research data that couldn't be covered verbally.

👍 Key Takeaway: Effective communication isn't just about sending a message; it's about making sure the recipient understood it, and that the method used was appropriate for the sensitivity and importance of the information.