Types of Business Communication

4 minute read
Types of Business Communication

For any business to flourish, the most essential factor is the smooth and fluent business communication within the organisation as well as their target audience. Business communication is the sharing of information within a business in internal as well as external terms. It can be simply understood as the process of circulating information from one source to another in a business environment. The sources in this communication can be within or outside an organisation. Let’s explore the different types of business communication at both internal and external levels.

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Elements of Business Communication

Before we explore the types of business communication, let us first understand the basic elements that constitute effective communication in an enterprise.

Sender: The person or the source through which the communication is initiated. Eg. employees, customers etc.

Business Information: A piece of information that has to be circulated amongst the workforce. 

Receiver: The person who receives the information. For example, employees, customers, etc. 

Feedback: A general reply or response to communication. 

Elements of Business Communication
Elements of Business Communication

Types of Business Communication 

Majority of the business organisations follow four main types of business communications, i.e. Internal (upward & downward), External and Horizontal/Lateral.

Types of Business Communication
Types of Business Communication

Now let us explore the types of business communication in detail. 

Internal Business Communication

The communication which happens within the members of an organisation can be regarded as internal business communication. It is inclusive of both formal and informal modes of communication. Whenever various departments convey the information to the employees of the organization, it comes under internal communication. It is vital to have effective internal communication as it increases productivity and satisfaction level. Predominantly, there are 2 types of internal business communication:

Internal Upward Communication

Internal Upward Communication
Internal Upward Communication

For Instance: The HR team of an organisation has prepared a report on a certain topic which is further communicated to the HR manager. This reflects upward internal business communication. 

Internal Downward Communication

Internal Downward Communication
Internal Downward Communication

For Instance: The CEO of an organisation has now laid down certain new guidelines as per the COVID-19 situation that has been propagated to all the employees. This is how communication within an organisation would occur as per the internal downward business communication. 

Horizontal/ Lateral Business Communication 

The communication which takes place at a horizontal level, i.e. amongst the co-workers of an organisation or firm is known as horizontal or lateral business communication. Majorly it is written or verbal communication. Out of all the types of business communication, this one happens through messages circulated between a single department, cross departments or between various individuals holding similar ranks. Through this form of communication, the information is only limited to the people working on the same rank. For attaining functional effectiveness as well as mutual cooperation, communication at equal hierarchy levels is important. 

Horizontal/Lateral Business Communication
Horizontal/Lateral Business Communication

Check Out: What is the Importance of Teamwork?

External Business Communication

Whenever any information regarding a business firm is provided to another business organisation or officials belonging to some other organisation outside the business environment then it is called external business communication. Oftentimes organisations interact with other organisations to enhance their business opportunities. Mainly the external business communication is done through written or verbal medium unlike the other types of business communication.

There are two types of external business communication, namely formal and informal. The formal external business communication includes mediums of communication such as letters, reports, presentations, memos, etc whereas the informal external business communication can have various mediums and is generally out of the control of an organisation. 

For Instance: You might have come across various deals or offers available at an online platform by a particular enterprise or business, this is the most appropriate example of external communication as the companies use mediums like different types of advertising, radio channels, social media ads, etc for their promotion. 

Some More Types of Business Communication

Based on Types 
Medium of Comunication Verbal 
Responses One way
Two way


How many types of business communication are there?

Internal (upward), internal (downward), internal (lateral), and external are the four primary types of company communication.

What are the 6 types of business communication?

Formal Communication.
Informal Communication.
Verbal Communication.
Non-Verbal Communication.
Upward Communication.
Downward Communication.
Horizontal Communication.
Diagonal Communication.

What type of communication is called business communication?

The Explanation Business communication is the exchange of information between people both inside and outside of an organisation. Employees and management communicate to achieve organisational goals through effective business communication.

What are the 3 categories of business communication?

In a broader sense, organisational communication can be divided into three types: internal operational communication, external operational communication, and. Communication between individuals.

What are the components of business communication?

Encoding, decoding, transmission medium, and feedback are the four communication components. A personal or corporate communication message is encoded and transmitted by the sender through one or more media to the receiver, who decodes it and responds with feedback.

We hope that this blog has provided you with the key features of different types of business communication. Do you feel your career growth is stagnant? Reach out to Leverage Edu experts and we will help you in sorting your career choices and preferences and make an informed decision towards actualising your career goals. Sign up for an e-meeting now!

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