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CPA 002: Communication Skills
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Formal Communication 

  • This is communication that travels through the formally established channels.
  • In other words, communication travels through the formal chain of command or lines of the hierarchy of authority.
  • Information is given through the formally designed channel or network.
  • It is designed, controlled, and regulated by the management. 
Advantages of Formal Communication
  1. It helps in the fixation of responsibility and accountability
  2. It helps in maintaining the lines of authority in the organization. 
  3. It helps in maintaining discipline. 
  4. It ensures an orderly flow of communication.

Disadvantages of Formal Communication 

  1. It lacks personal contacts and relationships. 
  2. It is time-consuming. It takes much time to communicate. 
  3. It creates a bottleneck in the flow of information because almost all information is channeled through a single executive. 
  4. It obstructs the free, smooth, and accurate circulation of information in an organization. 

Types of formal communication

  • Formal communication can be:-
  1. Horizontal
  2. Vertical
  3. Diagonal. 
i. Horizontal Communication:
  • When communication takes place between two or more persons of the same level or position of the same department or other departments of the organization, it is known as horizontal communication.
  • When the finance manager communicates with the marketing manager concerning advertising expenditures, the flow of communication is horizontal.
  • The objective of horizontal communication is to coordinate the efforts of different departments or persons.
Advantages of Horizontal Communication 
  1. Coordinating in nature. 
  2. Frequently informal and therefore simpler than vertical communication. 
  3. Reassuring those in charge of implementing department policy
  4. It provides them with the opportunity of checking with each other and compare notes. 
  5. Expedient in terms of communication time. 
Disadvantages of Horizontal Communication
  1. Department chiefs may remain uninformed about what their division heads are thinking. 
  2. It can have a disuniting effect by fostering clique i.e., grouping among personnel at the same levels of authority.
  3. It can distort the purpose of a department policy and even render it inoperative by allowing too much discussion about it. 
  4. It may actually increase misunderstanding among division heads by permitting informal (verbal) alterations of formal communications. 
ii. Vertical Communication:
  • The communication in which information is either transmitted from top to the bottom or from bottom to the top in the structural hierarchy is a vertical communication.
  • In this way, vertical communication may be of two types:-
  1. Downward Communication: When messages are transmitted from superiors to subordinates along with the chain of command, it is said to be downward communication. It refers to the transmission of information from superiors to subordinates. The most common downward communications are job instruction, official memos, policy statements, procedures, manuals, and company publications.
  2. Upward Communication: When messages are transmitted from the bottom to the top of the organizational hierarchy, it is said to be upward communication. This provides feedback on the extent of effectiveness of downward communication. It is also a means of informing the management about the viewpoints, reactions, feelings, and state of employee morale. Widely used upward communication devices include suggestion boxes, group meetings, reports to supervisors, and appeal or grievance procedures. Usually, upward communication is utilized in democratic and participative management. Effective upward communication channels are important because they provide employees with opportunities to have a say.
Advantages of Vertical Communication  
    1. It is authoritative and official.
    2. It is binding to all parties involved. 
    3. It is the most legitimate type of communication.

Disadvantages of Vertical Communication 

    1. It is formal and informal. 
    2. It is usually slow-moving since it must be channeled through several levels of authority. 
    3. It may conceal the true motives behind the formal message it carries
iii. Diagonal Communication:
  • It refers to the exchange of communications between supervisors and employees who are not in the same department or on the same organizational level.
  • Communication between managers and workers in various functional divisions is referred to as diagonal communication.
  • Although both vertical and horizontal communication is crucial, in most modern businesses, these categories no longer effectively reflect communication demands and flows.
  • The term “diagonal communication” was coined to describe the new communication issues that have arisen as a result of new organizational structures like matrix and project-based organizations.

Advantages of Diagonal Communication 

  1. It is the most direct method of communication. 
  2. It is the most selective method of communication.
  3. It is one of the fastest methods of communication.
  4. In critical situations, it would seem to be the most essential and logical type of communication.
Disadvantages of Diagonal Communication 
  1. It can destroy lines of authority and formal chains of command. 
  2. It can leave immediate superiors uninformed of what their subordinates are doing.
  3. It can lead to conflicting orders so it may lead to further confusion.
  4. It is usually verbal and thus is untraceable if things go wrong.

Informal Communication

  • Informal communication refers to the communication which takes place on the basis of informal relations between the members of a group.
  • It is personal communication in nature and not positional communication.
  • It does not flow along with the formal lines of authority or formal chain of command.
  • Even it is not regulated by formal rules and procedures.
  • Normally, members of the informal group use this form of communication in order to share their ideas, views, opinions, and other information.
  • There is a lack of official instruction for communication.
  • It is not controlled and designed by a formal organizational structure.
  • So, it is not used to communicate formal messages.
Advantages of Informal Communication
  1. It is more flexible.
  2. It helps to improve decision-making.
  3. Informal communication is faster in speed than formal communication.
  4. It works as a powerful and effective tool for communication.
  5. It may provide feedback to managers on their actions and decisions
Disadvantages of Informal Communication
  1. It is difficult to fix responsibility for the information.
  2. It may cause misunderstanding.
  3. It carries inaccurate, half-truth, or distorted information.
  4. It is difficult to believe the information.
  5. It leads to the leakage of secret information.

Types of Informal Communication

  1. Single Strand Chain: This is where one person tells something to another, who tells it to another person and the process goes on.
  2. Cluster Chain: This is where one person tells something to his trusted people, who then tell the same to their trustworthy friends and the communication continues.
  3. Probability Chain: This happens when a person randomly chooses some persons to pass on the information which is of little interest but not important.
  4. Gossip Chain: This happens when a person tells something to a group of people, and then they pass on the information to some more people, and in this way, the information is passed on to everyone.
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