Communication refers to the exchange of information and thoughts either through symbols or words between two or more individuals with the objective of creating a common understanding.
Alternatively, American Management Association (AMA) defines communication to include any behavior that culminates into interchange of meaning. Communication is an important component in the success of firms in different economic sectors. Debasish and Das (2009, p.13), assert that organizational communication forms the basis of a well governed firm.
Lack of a favorable communication climate within a firm can limit a firm’s effectiveness with which it deals with the modern complexities characterizing the business environment. Communication is inseparable from other organizational functions (Debasish & Das, 2009, p. 13).
According to Krizan, Logan and Williams (2008, p.5), a firm should have a well integrated internal and external communication networks in order to survive the competitive business environment. Communication determines the probability of a firm succeeding. For example, the success of firms’ day to day activities is affected by the effectiveness with which information is exchanged amongst the employees.
Some of the most common types of internal communication within firms relate to performance objectives, financial data, customer orders, employee production reports and job instructions. Through such information, the efficiency with which a firm’s management team makes strategic decisions is increased.
There are diverse purposes why firms should consider communications as an organizational asset. One of the purposes relates to giving instructions and guidance through which various issues should be addressed. Communication also contributes towards integration amongst the various stakeholders culminating into emergence of good inter-relationships.
There are a wide range of benefits associated with external communication. For example, an effective external communication contributes towards creation of a high goodwill. Debasish and Das (2009, p.17) are of the opinion that the image of an organization is dependent on the nature of relationship it establishes with the external environment.
In addition, it also enhances a firm’s continued growth and long term existence as a going concern entity. Failure to incorporate an effective external communication mechanism can result into stagnation in business growth. Boone and Kurtz (2010, p.45) assert that businesses utilize external communication as a strategy to retain their operations, maintain their market positions, to create customer relationships.
The scale of a firm’s external communication may either be local or international. A firm’s external communication may entail a wide range of issues such as making sales calls, posting employment notices, advertisements, news releases, making bank transactions and reporting to various governmental agencies.
Some external communications such as creating awareness regarding introduction of a new product in the market, undertaking plant expansion and making annual reports have a long range impact on a firm.
According to Krizan, Logan and Williams (2008, p.5), business communication is transactional in nature in that it entails establishment of a give-and-take relationship between the stakeholders (the sender and the receiver). The core objective is to establish a mutual understanding.
However, firm’s management teams are faced with a challenge with regard to maintenance of an effective external communication within their firms. The resultant effect is that most organizations are characterized by poor communication. This paper is aimed at conducting a comprehensive analysis of external communication.
Objectives of the study
Objectives of a study include the various goals that the researcher intends to achieve. This study is guided by three objectives as outlined below.
To conduct an analysis of the external channels of communication incorporated by organisations.
To evaluate the effectiveness with which TNT Express UAE has integrated external channels of communication.
To recommend other channels of external communication that the management team of TNT Express UAE should consider.
Integration of an effective research design is paramount in determining the success of a particular study. In conducting this study, the researcher incorporated both primary and secondary research methods. The secondary research method used in the study entailed reviewing past literature on the topic from secondary sources of data such as books.
On the other hand, the primary research method used entailed conducting interviews with TNT’s Express UAE customers and suppliers as the main respondents. The respondents were selected at random by approaching the company. The researcher designed a questionnaire which was used in interviewing the respondents. The researcher administered the questionnaire to 10 respondents.
Significance of the study
The case study will enable the researcher to determine the effectiveness with which TNT Express UAE has integrated external communication. It will also enable the management team of TNT Express UAE to understand the gaps within the organisation with regard to external communication. As a result, the study will give the management team insight on how to improve its external communication.
On the other hand, the literature review will give the researcher an understanding of the importance of external communication in the survival of a firm as a going concern entity. The review will also give the researcher an understanding of the various channels of external communication that business organisations can incorporate.
Limitations of the study
In conducting studies in different academic fields, researchers usually consider wide scopes. This increases the effectiveness of the study. However, it is difficult to address all the aspects of the study through a single study. External communication in businesses is such a wide field of study that the researcher cannot exhaust in a single study. This study is limited in that it only considers two research methods which include literature review and case study.
External communication is vital in the success of firms since they do not operate in a vacuum. Krizan, Logan and Williams (2008, p.5) defines external communication as the flow of work-related information between a firm and the various entities with which it interacts. In their operations, firms come into contact with a wide range of stakeholders such as suppliers, governmental agencies, the society within which it operates competitors and the media.
Therefore, establishment of an optimal external communication is paramount. There are diverse reasons why external business communication is essential as discussed herein. According Kitchen (1999, p.112), external communication contributes towards a firm establishing a sustainable and supportive relationship with the external stakeholders.
For a firm to succeed, it must integrate marketing as one of its functions. The success with which a firm undertakes its marketing activities is dependent on its effectiveness in creating market awareness. External communication also contributes towards an increment in a firm’s shareholders value. This arises from the fact that a positive image culminates into an improvement in the firm’s share price.
A rise in a firm’s share price culminates into a rise in the shareholders confidence pushing the firm’s share value further up. The resultant effect is that the shareholders wealth is maximized. Additionally, external communication contributes towards improvement in a firm’s credit rating. As a result, its ability to source for credit finance successfully is increased thus increasing its expansion and growth ability.
External channels of communication
There are a wide range of channels of communication that organisations use in communicating with the various stakeholders. These channels can be categorised into three groups as outlined below.
Written channels of communication
Oral channels of communication
Visual channels of communication
Written channels of communication
This is one of the most commonly used channels of communication. There are a wide range of written channels that a firm can utilize. In undertaking their marketing role such as creating market awareness, most organisations integrate advertising as one of methods of creating awareness. According to Nurula (p. 187), organisations must employ marketing communication in order to create sufficient awareness to potential customers. To attain this, most business organisations have integrated the concept of advertising.
According to Nurula (p. 187), advertising plays a vital role in creating awareness regarding the existence of a firm’s product in the market. In addition, advertising contributes towards a firm being efficient in creating the intended message. For advertising to be successful, it is paramount for firms to conduct an effective identification of the target audience in order to determine the most effective channel of advertising to use.
Effective channel selection increases the prospective of the intended message reaching the target audience. Currently, businesses are faced with a wide range of channels to select from in their advertising processes. This is due to the fact that media usage has become very fragmented (Narula, 2006, p.190).
Organisations can select from mediums such as the television, radio and the print media for example magazines and newspapers. Additionally, firms can decide to incorporate outdoor channels of advertising such as by electing billboards in strategic locations such as market places, and along roads. Organisations can also decide to undertake exhibitions of its products in an effort to communicate product information to its customers.
However, in selecting their mass advertising mediums, management teams should analyse the probability of success by utilising a particular mediums. Amongst the elements that should be selected is the market coverage of the medium. Firms should select a channel that has extensive market coverage in order to reach a large number of customers.
According to Narula (2006, p.191), organisations should be creative and innovative in designing the advertisement content which includes the message. This message can either be communicated via graphics, picture images, slogans or cartoon. However, the message should be focused according to the targeted audience.
In addition to the conventional channels of external communication such as use of television, radio, use of billboards and print media, organisations should also appreciate the role of information communication technology in advertising. As a result, firms should incorporate emerging channels of advertising. One of the channels that firms should consider includes the internet. Currently, most organisations are integrating the internet as a medium to communicate to the public.
To attain this, organisations in different economic sectors are increasingly designing their own website. According to Masterman and Wood (2006, p.109), organisations can use their website to communicate to the public such as the investors, sponsors, current and potential customers on a wide range of information. The organisation can design the website in such a way that gives the customers an opportunity to select the type of information they require.
For example, some of the information which an organisation can post on its website may relate to its products. This will enable customers to understand the firm’s products and services. The internet increases the efficiency with which a firm communicates with the public. This arises from the fact that it is easy to update the information posted on the internet.
Masterman and Wood (2006, p.109) are of the opinion that the internet does not only enable a firm to create an efficient interaction with the customers but also other intermediaries such as the suppliers. It is vital for firms to maintain an effective communication with its suppliers. Communicating to the suppliers can enhance a firm’s quality of products and services.
This is due to the fact that a firm is able to give specifications on the nature of the raw materials required. Considering the complexity of the business environment, maintenance of a continuous relationship with the suppliers is an important consideration. To attain long term survival, firms it is vital for firms to undertake continuous advertising.
According to Guffey, Rogin and Rhodes (2010, p.183), business letters are amongst the most powerful mediums through which organisations undertake external communication despite the increase in the use of emails. Guffey, Rogin and Rhodes (2010, p.183) assert that the continued utilisation of business letters arises from a number of reasons.
Firstly, it is possible to keep business letters if permanent records are required. In undertaking business transactions with various external stakeholders, most organisations require permanent records.
Business letters may contain sensitive information such as information regarding business agreements and decisions. Written communication such as use of letters can also be utilised when communicating to other intermediaries such as retailers, wholesalers and distributers.
Some of the information which may be contained in these business letters relates to incentives, order processing, special offers, product availability, contractual aspects, and delivery aspects. Written communication such as letters can be used to invite orders and communicate special offers.
Despite the increased utilisation of emails and telephone conversation in making business transactions, some important information is exchanged via business letters. Information which may be contained in business letters relate to the terms of the transaction and agreements. Such letters are filed by the parties for record purposes (Guffey, Rogin & Rhodes, 2010, p.183).
Secondly, business letters are an important in that they ensure maintenance of a high level of confidentiality. Despite integrating emerging technologies such as the emails, businesses have appreciated the challenges associated with digital communication. For example, sensitive business documents can lose their confidentiality in the course of them being transferred digitally.
As a result businesses consider using business letters in communicating to certain external stakeholders such as shareholders. Business letters have a certain level of confidentiality since they cannot be retrieved by unauthorised individuals.
Guffey, Rogin and Rhodes (2010, p.183) assert that business letters are an effective channel of external communication in that they are persuasive. A business letter can have a significant influence on the target audience. This arises from the fact that a firm takes time in organising the intended information.
Organisations can also integrate direct mails in communicating to their customers. Direct mails as a method of creating awareness regarding a firm’s products and services is commonly used when marketing to organisational customers. In this method of communication, a marketer takes promotional materials directly to the potential customer. Marketer asks the customer to respond through mail or personal visit.
According to Nurula (p. 187), direct mails are strong channel of communicating to the potential customer. This is due to the fact that, they can influence a consumer to purchase a new product introduced in the market. In marketing to organisational customers, businesses continually utilise direct-mail letters.
In their operations, firms are required to account to the shareholders and the public on the various issues that it has undertaken during a particular year. This form of communication is achieved by releasing annual reports. Some of the information contained in the annual report relates to the firm’s financial performance. Annual reports are important channel through which an organization can disclose its operations. The result is that the stakeholders’ level of confidence is enhanced.
One of the ways through which a firm can enhance its relationship with the external stakeholders is by incorporating the concept of public relations. According to Kitchen (1999, p.111), public relations entail the process through which an organization maintains its reputation. Alternatively Jefkins defines public relations as the process through which an organization deals with untreated credible facts in order to eliminate any misunderstandings.
This means that the core objective of public relation in an organization is to create a high level of understanding and to influence the opinion of the public thus gaining its support. Kitchen (1999, p.111) is of the opinion that a firm’s ability to succeed in the long term is dependent on what the consumers think about the firm, what it says and does. This arises from the fact that a firm’s actions affect its reputation.
A study conducted by Mazur and White revealed that public relations should be considered as component of a firm’s strategic management (Kitchen, 1999, p.111). This means that firms should incorporate public relations in their financial and human resource management strategies.
According to Kitchen (1999, p.111), public relations as a form of external communication through channels such as press releases contributes towards a firm’s long term success by identifying and predicting issues that have a probability of affecting its relationship with external stakeholders. Public relations play a vital role in establishing cohesion with the external groups vial effective communication.
Upon identifying the external groups, an organization’s public relations manager is able to determine the most effective strategies to establish and maintain communication. Kitchen (1999, p.112) asserts that public relation is an important component in the existence of an organization for a number of reasons. One of these factors relates to strategic crisis management.
Business organizations cannot rule out the probability of crisis in the process of interacting with the various external entities. In such a situation, it is paramount for firm’s management teams to resolve such crisis optimally in an effort to restore the organizations public image. This can be attained by integrating effective communication such as undertaking a public relations campaign.
However, the success of such public relation campaigns is dependent on the effectiveness with which the firms have established external communication with the external stakeholders. One of the ways through which a firm can retain its image is by producing information brochures or flyers. The information brochures and flyers should explain the organizations’ stand to the public. Additionally, public relations manager may also consider posting articles in the local dailies.
A number of firms have integrated written channels of communication in an effort to restore their image. For example, Reliance Limited which is a petrochemical firm operating in India was sued by the Indian government due to its involvement in irregular business activities within the stock market. The prosecution led into a massive decline in the firm’s share price arising from a decline in the shareholder’s confidence towards the company.
In an effort to redeem itself, the firm undertook a comprehensive public campaign to counter the government’s allegations. This was attained by telling the public the truth and the facts of the matter. The campaign was successful in that the firm regained its lost confidence hence restoring the public image.
The importance of external communication in crisis management is also evident in the case of Coca-Cola and Pepsico which are multinational companies operating within the soft drink industry. In 2003, the two firms were accused by an independent public interest organization by the name Center for Science and Environment in India of selling soft drinks that were contaminated with pesticides.
CSE alleged that it had conducted a scientific analysis on the two companies’ soft drinks and found high levels of contamination by pesticides. The director of the independent group said that such levels of contamination could result into birth defects, cancer and also harm individuals’ nervous systems if consumed for a long period.
In addition to the criticism of the soft drinks by CSE, the two firms were also criticized by another public interest group by the name India Resource Center (IRC) of over consuming and polluting India’s scarce water resource (Carrol, 2009, p. 856).
IRC accused Coca-Cola of subjecting the Indian population living around its bottling plants to severe water shortages. In its opinion, IRC was of the opinion that Coca-Cola was depleting the water table. The firm was also accused of polluting the soil by distributing its solid waste to the farmers within the vicinity in which it operated as fertilizer. In 2004, the Indian parliament banned Coca-Cola from selling its soft drinks in its cafeteria.
During the same year, the Indian Supreme Court ordered the two companies to include warnings in labeling their products (Carrol, 2009, p. 856). This led into a significant decline in the firms’ sales in subsequent year. In an effort to regain public confidence, the two companies undertook a comprehensive public relations campaign via public announcements and press releases.
Oral channels of communication
Negotiations and round table discussions
Negotiation is an important component in business communication. Negotiations enable a firm to extend dialogue into the public realm thus attaining consensus building. According to Lerbinger (2006, p.72), negotiations as a channel of communication enables firms avoid government involvement. The objective of negotiations in organizations is to attain a win-win outcome whereby all the parties involved benefit.
In their operation, businesses encounter a wide range of situations that require negotiation. According to Chaturvedi and Mukesh (n.d, p.194), negotiations may be utilized in the event of problems that are not easily resolved by one individual.
Through negotiations, it is possible to overcome the disagreements. However, negotiations are only possible if the involved parties are willing to negotiate. Businesses can utilize negotiations in case of conflicts with external parties such as the society in which they operate. By communicating with the society members, a firm positions itself in the society as a responsible business entity. In their operation, organizations are required to engage themselves with corporate social responsibility.
This entails helping the members of the society within which they operates by engaging themselves with certain projects. To be effective in their corporate social responsibility, organizations should engage the society leaders in negotiations so as to determine the most appropriate social project to invest in.
There are two forms of negotiations that an organization can adopt. These include formal and informal negotiations. In formal negotiations, the parties involved stipulate the agenda and arranges a meeting. The parties involved are also assigned specific roles. For example, one of party may put forward the reasons for the negotiation while the second party makes the suggestions.
The third party may evaluate whether there are any omissions in an effort to ensure success of the negotiation. Formal negotiations are possible to undertake in that the parties have sufficient time to analyze the situation. On the other hand, informal negotiations are casual in nature in that there are no formal arrangements.
Exhibitions and trade fairs
According to Blythe (2005, p.578), a significant proportion of businesses integrate trade fairs and exhibitions in their marketing processes. However, there are number of debates over the effectiveness of trade fairs and exhibitions in communicating to the public. Most scholars argue that trade fairs and exhibitions are not effective when compared to advertising. This is due to the fact that only a small percentage of prospective customers attend the exhibitions and trade fair hence accessing the information.
Despite this Blythe (2005, p.578) is of the opinion that exhibitions are most common in business-to-business transactions. This arises from the fact that they give marketers an opportunity to interact with prospective customers. Trade fairs and exhibitions are usually organized on an international scale. Therefore, utilizing this channel of market communication can contribute towards a firm expanding its market coverage by meeting customer from different countries.
Blythe further asserts that trade fairs and exhibitions give the customer and the seller an opportunity to develop their relationship. He cites the relaxed environment in which the two parties interact as the contributing factor. Trade fairs and exhibitions are an important channel through which a firm can attract organizational customers.
This arises from the fact that most of the individuals who patronize the fairs and exhibitions are administrators of organizations in different capacities (Blythe, 2005, p.578).
Audiovisual and digital channels of communication
There are different types of audio-visual and digital channels of communication. The main common forms include use of videos, faxes, weblogs, websites, telephone and emails.
Case Study of TNT Express U.A.E
TNT Express U.A.E was established in 1946. The firm operates as a multinational company with its headquarters located in Dubai. In its operation, TNT Express provides delivery services of document, parcels and freight shipment to its customers who are distributed in more than 200 countries. The firm serves its customers through road and air.
To attain its goals, the firm’s management team ensures that it has all the necessary resources. Currently, the firm’s human resource base is composed of more than 75,000 employees who are distributed in the 200 countries (TNT Express UAE, 2011, para.2).
To be effective in its logistics, TNT Express UAE has a fleet of 47 aircrafts and more than 25,000 vehicles. All the firm’s operations are guided by clearly stipulated missions that entail ensuring that it exceeds the customer’s expectations with regard to delivery of documents and other goods.
To attain this, TNT Express has incorporated an effective delivery network that entails door-to-door service. Decision to incorporate door-to-door strategy in its delivery network arose from the firm’s intention to deal with the daily challenges that it encounters. Since its inception in 1946, TNT Express U.A.E has developed delivering expertise. Currently the firm has emerged as the leader in express delivery services (TNT Express UAE, 2011, para.2-6).
The firm’s management team is also committed towards ensuring that its service delivery contributes towards a high level of customer satisfaction. This is inline with its mission of delivering value to its customers and instilling pride (TNT Express UAE, 2011, para.2).
One of the ways through which the firm has attained this is by being committed towards establishment of a strong and long term relationship with its customers. To attain this, TNT Express UAE ensures that the customer’s products are handled with a high level of care.
In order to create customer satisfaction, the firm has incorporated a number of standards that guide all its employees. Some of these standards include ensuring honesty, operating as a team and being passionate towards the customers In addition, the firm also ensures that the customers receive their parcels and documents being delivered in time.
In its operation, TNT Express UAE has integrated a number of external communication channels. Ninety percent of the respondents interviewed said that TNT Express UAE issues press releases and statements frequently through its press office. As a result, its customers are able to receive the required information.
The press releases and statements enable TNT Express UAE to provide journalists with information on various issues that are requested by the public. The resultant effect is that the firm is able to communicate effectively with the various external stakeholders who require the company information.
Considering the intensity of competition within the industry, TNT Express UAE has appreciated the importance of developing a strong relationship with organisational customers. To attain this, the firm has integrated the use direct mail in communicating to the customers.
Seventy five percent of the respondents interviewed said that the firm sends business letters and direct mails from time to time. As an external channel of communication, the use of direct mail have been efficient for the firm considering that it is mainly involved in business-to-business transactions.
TNT Express has also incorporated non-conventional channels of external communication one of them being the use of digital channels. Seventy percent of the respondents cited the website as one of the most effective digital communication that TNT Express UAE utilizes. TNT Express UAE has designed a website through which it provides information to external stakeholders.
Through the website, the firm posts diverse company information and news. Some of the information which the company provides through the website relates to the services that the firm offers. TNT Express offers a compressive set of services.
Some of the main types of information provided relate to express delivery services, outsourcing services, special services, electronic services, industry solutions and shipping information. The firm continuously updates its website in an effort to ensure that the external stakeholders receive the most recent company information (TNT Express UAE, 2011, para.6).
Eighty five percent of the respondents interviewed said that TNT Express UAE has established a contact helpdesk through which the customers can make enquires. These respondents said that the helpdesk is effective in that it is electronic in nature. As a result, customers send their inquiries to a specific email. Through the helpdesk, customers can inquire about the delivery status of their consignments and other booking inquiries.
In addition, the firm has also provided the public with a telephone number which they can call and seek assistance by speak to a customer care agent. In addition, fifty percent of the respondents interviewed said that the firm holds negotiations and discussions in order to establish a common position in case of certain situations.
Ninety percent of the respondents interviewed said that TNT was relatively effective in utilising emerging information communication technologies. They said that TNT Express has incorporated electronic commerce as an external channel of communication so as to maintain a good relationship with its customers. Currently, it is possible for customers to manage their shipments online through their mobile phones and personal computers.
Additionally, TNT Express UAE has also integrated emerging Express Import systems. The system enables TNT Express UAE customers to have absolute control of their delivery. By utilising this technology, it will be possible for customers to order imports according to their desired terms. For example, customers can be able to make payment using their local currency.
The company’s Express Import System also enables consumers to attain information on when their deliveries will arrive. The system is highly automated in that it creates a link between the seller and importing customer by sending an automatic email.
The non-conventional channels which are supported by emerging information communication technologies have been very efficient compared to the conventional means. For example, by utilising its company website in communicating to the external stakeholders, the firm has been able to communicate to a large number of individuals more cost effectively. The company is also able to update the website more efficiently.
The analysis has illustrated that there are a wide range of external communication channels that an organisation can utilise. The two main categories of communication channels that firms integrate include the conventional channels and the non-conventional channels. In its operation, TNT Express UAE has integrated both conventional and non-conventional channels. Some of the main conventional methods of communication integrated by the firm include use of business letters, direct mails, telephone and negotiation.
In addition, the firm also utilises information communication technologies such as use of emails. However, the research findings of the study indicate that there is a gap in the firm’s external communication using non-conventional channels. This is due to the fact that the firm has not utilised digital communication channels exhaustively.
In addition to its Express Import System, the firm’s management team should also consider incorporating emerging social communication technologies.
Some of the technologies that the management team should consider include use of social networking tools such as Blogs, Wikis, You Tube and Facebook. Through these tools, TNT Express UAE will be able to able to communicate effectively to the various stakeholders.
Currently, a significant proportion of external business stakeholders are increasingly utilising emerging social networking tools. By integrating these tools, TNT Express UAE will not only be effective in communicating with the public but also in interacting with the public.
Currently, the firm’s interaction capacity through communication is limited. Incorporating the social communication tools will attract a large number of potential customers. The social networking tools act a platform through which interaction occurs. For example, by developing a Blog and a Wiki, it will be possible for the public to post their opinions regarding the firm’s operation.
This arises from the fact that a large number of customers are integrating social communication tools in their consumption behaviour. Therefore, it is paramount for the firm to move with the market trend. As a result, the firm will be in a position to identify the areas of its operation in which improvement is necessary.
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