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iii. Communication is a process in which a sender and receiver share similar
meaning of message.
Effective communication is important for managers in organizations to perform
their basic functions of planning, organizing, leading and controlling. The process of
communication makes it possible for managers to carry out their task responsibilities.
Thus, communication process is the foundation upon which managerial functions
depend.

Types of communication
Communication can be classified on the following basis:

1. On the basis of means used: Communication is divided into two groups on the
basis of means used:
a. Written communication: Written communication is the exchange of
information through written words. It is the very popular, formal and
widely used communication. It is very much important and common in
business communication because it ensures accuracy and plays a proof
of evidence in near future. It includes a letter, circular, manual, bulletin,
office memo, etc.
b. Oral communication: Oral communication is the exchange of information,
ideas, facts or opinions through spoken words either face-to-face or
through telephone or some other mechanical device. The main benefit of
oral communication is that it allows two way communications and can
generate immediate feedback. Oral communication is excellent for speedy
interchange of ideas.

2. On the basis of relationship: Communication is divided into two groups on
the basis of relationship:
a. Formal communication: It refers to the communication that follows the
official chain of command. It is the proper channel of communication
determined by management for flow of objectives, plans, policies,
programs, feedback, suggestions and grievances in systematic way. The
formal communication is managed and controlled by the management of
an organization.

b. Informal communication: It is the organizational communication that
is not defined by the organization’s hierarchy. Thus, it may flow in any
direction without following any organizational structure. Informal
communication can take place between any levels in the organization.
3. On the basis of direction: Communication is divided into two groups on the
basis of direction:
a. Upward communication: It is the communication which flows from the
lower level to the higher level i.e. from the sub-ordinates to the superiors
in the organization. Generally in this type of communication the problems

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