Analysis of Business Communication Theories: CBA Case Study, Sem 3

This essay provides an in-depth analysis of business communication theories and their practical application within the Commonwealth Bank of Australia (CBA). It begins with an executive summary and introduction outlining the scope of the analysis, followed by a detailed examination of both inte...Read More

Business Communication Theories

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BUSINESS COMMUNICATION THEORIES
Executive Summary
A brief discussion is done over the application of business communication theories with
respect to the communication practices adopted by Common Wealth Bank of Australia.
Companies are using internal and external communication strategies for dealing effectively
with customers and public. Common Wealth Bank of Australia is also using the various
sources and methods of communication for promoting its products and brand. CAB is also
using the communication strategies to maintain a fair public image.
An analysis is also done over the barriers of the communication which should be removed by
using suitable and appropriate methods. An importance of effective business communication
is described in the report. On the bases of the analysis the conclusion is derived and it can be
said that effective communication plays a very crucial role in the overall development of the
companies.

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BUSINESS COMMUNICATION THEORIES
Table of Contents
Executive Summary...................................................................................................................1
Introduction................................................................................................................................3
Analysis of Business Communication Theories........................................................................3
Analysis of communication theories with respect to Common Wealth Bank of Australia. . .3
Internal communication theories........................................................................................4
External communication theories.......................................................................................5
Channels of external communication.................................................................................6
Importance of effective communication....................................................................................7
Major business communication barriers....................................................................................8
Recommendations to remove barriers in communication..........................................................9
Conclusion................................................................................................................................10
References................................................................................................................................11

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BUSINESS COMMUNICATION THEORIES
Introduction
In this report an analysis will be done over the communication theories and their application
in Common Wealth Bank of Australia. The focus is provided on the use of communication
theories in the development of the organisation and the importance of effective
communication. An analysis will be done over the methods by which the effectiveness of
written and oral communication can be improved. The key communication issues are also
finding out with respect to the context of Common Wealth Bank of Australia. In the end,
recommendations will be given to improve the communication strategies.
Commonwealth Bank of Australia (CBA) is one of the largest and popular banks of Australia
which is basically dealing with many banking and financial services related to the financial
management of the clients like saving accounts, deposit accounts, loans, debit cards, credit
cards, other telephonic, mobile and ATM related services, fixed deposits, mutual funds,
insurance, wealth management services and other financial investment product throughout
the world. It was established in the year 1911 by Australian government but got completely
privatised in the year 1996. CBA got 79th rank in the ‘2019 Forbes Global: The World’s largest
Public Companies 2000’ with the market value of $92.8 billion (Forbes, 2020).CAB is doing
business in many other countries like New Zealand, countries of Asia and various countries
of USA and UK (Forbes, 2020).
Analysis of Business Communication Theories
Business communication refers to a process of exchanging the information in the form of
written or oral by using various modes of communication like reports, presentations, and
messages on mobiles, E-mails, newspapers, television and social websites (MASJEDI, 2020).
In the context of any business the communication is of two types. First is internal
communication which describes the communication practices inside the organisation.
Another one is external communication which focuses over the communication practices
outside the organisation for example communication with customers, investors and public
(Cacciattolo, 2015).
Analysis of communication theories with respect to Common Wealth Bank of Australia

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BUSINESS COMMUNICATION THEORIES
The bank is used external and internal communication practices inside the organisation to
convey their goals, objectives, plans and product details to their employees for achieving the
common goal for the benefit of bank.
Internal communication theories
The internal communication theories refer to the exchange of information within the
employee of bank, from top management of the bank to middle and low level managers.
Some of the theories related to internal communication are as follows:
(a) Vertical Communication theory:
The theory of vertical communication is focuses over the process of delivering the
information from the top management or managerial level of the organisation to the middle
level or low level of employee. This communication theory follows the steps of
communication following the hierarchy level.
For example: If the branch manager of Common Wealth Bank of Australia is going to
launch a new financial product related to mutual fund, he would give presentation in the front
of all the employees in order to make the employee understand about the special features of
mutual fund related to its maturity time, rate of return, description of the assets involved with
it and the risk attached with the mutual fund (M Brunton, 2015).
(b) Horizontal communication theory:
It refers to the exchange of information within the same level of managers of the company. It
also involved the transmission of the messages and information within the different
departments of the company. In this type of communication, ineffective communication can
leads towards the disasters because of the misunderstanding between the departments of the
company.
For example: If the sales manager of Common Wealth Bank of Australia would like to know
the revenue generated by a credit card from the Finance department of the bank. Managers
usually prefer written communication with the help of e-mails in these types of cases.
Sometime direct conversation may also takes place by the same level of managers for fastest
exchange of information on urgent bases (Bank, Guidelines for Communication between,
2020).

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BUSINESS COMMUNICATION THEORIES
(c) Formal Communication:
This type of communication theory strictly uses highly professional words and language.
Usually this type of communication theory applied in writing the business reports for the
company, articles in magazines, various memos and presentations used by the banks and
other companies for promoting their businesses. This type of communication consists of very
sophisticated language with proper format for a clear understanding of the message and
information. It generally used inside the organisations for giving instructions to the
employees of the organisation.
For example: Common wealth bank of Australia publishes its reports in order to
communicate the financial information of the company to its investors and for common
people to maintain the transparency (bank, 2020).
(d) Informal communication:
Informal communication takes place inside the organisation while talking randomly to the
employee. Informal communication may also take place among the mangers of the company.
Use of simple words and fastest communication is the major importance of this type of
communication. Talking and chatting between the employees also involved with this stage, it
is also known by ‘Grapevine communication’. Employee and managers usually discuss the
important issues related to the operations of the company in this type of communication for
getting fastest information.
For example: If any employee of Common Wealth Bank of Australia want to discuss some
special features of insurance scheme to the sales manager for dealing an important client, he
may directly ask to the manager for fastest communication (A Nabie, 2016).
External communication theories
External communication describes a process in which the exchange of information is takes
place within the organisation to outside the organisation. It includes exchanging or providing
the information to other business sectors, customers, investors and public. The major goal of
the external communication is to enhance the sales, to make good reputation of the company
or to satisfy the investors by providing important information about the products of their
company (Bank, Investor centre:Information on our securities, financial results,
announcements, sustainability reporting, and other disclosures., 2020).

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BUSINESS COMMUNICATION THEORIES
For example: If Common Wealth Bank of Australia launched a new medical insurance
scheme for customers, it may take help of advertisements through television, social websites
and mobile apps. The bank can send messages to its existing customers for offering them the
new insurance product. Common Wealth Bank of Australia also prefers to give its
advertisements in between the cricket segments and it uses the banners of the company to
promote its brand image (R Piehler, 2019).
Channels of external communication
Many channels or modes of communication are using by different organisations for extending
their business and sales with the help of effective communication. Some channels and their
use by CBA are as follows:
(a) Use of official website:
Common Wealth Bank of Australia uses its official website to promote its products by giving
all necessary information about the products on the website. Website of the bank involved the
detail of many financial products like: Credit card, debit card, loan schemes, saving account,
fixed deposits, insurance schemes and other financial products. Customers may find the
details about the product related to expected return and risk so that he can decide very easily
whether to purchase the product or not. By providing the telephone numbers and e-mail
services with effective communication skills through its website, CBA make the customers
ensure about their connectivity and response (CD Maier, 2019). Telephonic services are also
a very good method of communication to the customers for solving their problems and
provide quick post-sales support (Compavt, 2017).
(b) Mobile apps:
CBA provides mobile banking apps for an effective and time saving communication with the
existing and future customers. By using mobile apps the customers may receive the
information about the financial products of the company. Moreover customers make
payments and transfer the money from one account to another with the help of mobile apps. It
becomes a very efficient method of communication in between the bank and the clients. CBA
offers mobile banking services in order to provide quick and efficient services to the
customers (Compavt, 2017).
(c) Social websites:

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BUSINESS COMMUNICATION THEORIES
Common Wealth Bank of Australia is very active on social websites like: Facebook and
twitter for enhancing the value of its brand name (Australia, 2007). It is giving
advertisements and information related to their products to attract maximum number of
customers. CBA also involved in the latest campaigns related to social issues and
philanthropic activities to make a good public image by publishing their news using social
websites (Durkin, 2019). CBA is working for the well-being of health and education of
children of Australia by providing funds for them and these activities are communicated to
the public with the help of its official and social websites for maintain a favourable public
image (Bank, Community Grants, 2020).
(d) Advertisements:
Common Wealth Bank of Australia is giving advertisements on televisions and on
newspapers and magazines to promote its business. Advertisements are a one way
communication provided by the banks to remind the customers about the special features of
the products. CBA is also active on you tube for enhancing its brand value (onyu.com, 2017).
Importance of effective communication
Effective communication is very much required for the development of the organisation. If
ineffective communication practices take place inside the organisations, it proves fatal for the
company. For example: If there are spelling mistakes in the content of E-mails send by the
senior managers to junior managers, there are a huge chances to misunderstandings generated
by the wrong message and sometimes these types of situations are harmful for business
(MASJEDI, 2020).
To avoid ineffective communication managers should use simple language and short
sentences. Use of heavy words and jargons should be avoided to make the language simple
and easy to understand. In written communication there is a very important role of language
and sentences that is why every company has to take care of language while using it for
internal communication (F Jelani, 2019).
While communicating through the employees of the organisations, manager has to focus on
the verbal and non-verbal language they are using. Correct gestures and favourable body
language always helps the managers in maintaining a satisfactory communication level

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BUSINESS COMMUNICATION THEORIES
within their team members. Emotional barriers and perception bias should be removed for a
better communication practices inside the organisation (Compavt, 2017).
Effective external communication may leads towards the better reputation of the company but
also it gives the complete information about the products of the company. For example: If
Common Wealth Bank of Australia maintain the website of the company with a very good
content and effective presentation, it will lead a better understanding of the schemes of
financial products like: Saving accounts, Credit card, debit card, home loans, car loans, life
insurance, medical insurance, mutual friends and other investment management schemes
(Bank, Bank accounts:Explore our range of everyday and savings accounts, with award-
winning features to help you stay on track and in control of your money., 2020).
Common Wealth Bank of Australia is also involved in philanthropic activities like providing
funds for the development of youths. The bank is also involved in providing charity at
national level. These activities communicated externally through its websites in order to
maintain a favourable impression in the public (Bank, Community Grants, 2020).
Overall the CommBank and other companies are using external communicative strategies to
promote their brand name in order to enhance their sales of financial instruments (Bank,
Bank accounts:Explore our range of everyday and savings accounts, with award-winning
features to help you stay on track and in control of your money., 2020).
Major business communication barriers
There are many reasons exists because of those reasons, communication practices are failed.
Some of the major barriers in communication are as follows:
(a) Psychological barriers: Sometimes the persons have psychological problems like
stress, comparisons and tensions due to his personal and professional life, in these
cases the person may be misunderstand the messages or information delivered by
another person. Stress free environment and a positive attitude are required for
removing these barriers of communication (F Jelani, 2019).
(b) Semantic Barriers: Use of same meaning of one words and symbols may leads
towards the misinterpretations of messages and information that can create chaos
inside the organisation. Use of specific words may resolve this problem up to some
extent (F Jelani, 2019).

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BUSINESS COMMUNICATION THEORIES
(c) Language Barriers: Difficult terminology used by the sender creates problems in
understanding the information. A lot of jargons and difficult words may prove as a
hurdle in the proper understanding of the message (DD Qian, 2019).
(d) Other major barriers: Lack of alertness and interest in receiving the information
proves towards misinterpretation of the message. Laziness and negative attitude may
always results in problems related to communication. Sometimes physiological
problems and health issues are also proves as a barrier in communication (F Jelani,
2019).
Recommendations to remove barriers in communication
(a) Active listening: By actively listening the messages and information the barriers in
communication may be removed. Active listening also helps in getting the proper
instructions and messages associated with the information.
(b) Use of simple language: The language should be as simple as possible while forming
any message or delivering any information through various channels of
communication. Use of simple language also reduces the complexity of the message
and by this it enhances the effectiveness of communication (A Nabie, 2016).
(c) Positive attitude: Favourable and positive attitude may leads towards the right
understanding of information. Positive attitude helps in understanding of verbal
communication by removing perceptual barriers in understanding the information (A
Nabie, 2016).
(d) Clarity of the content: The content which is using by senders should be clear, short
and specific so that the information can be easily understood by the receivers. Clarity
and transparency of message make the information easy to understand (A Nabie,
2016).
(e) Concreteness: The message should be concrete and effective in content for the proper
understanding it to the receivers. Unnecessary and irrelevant information associated
with necessary information will leads towards the misunderstandings and wrong
interpretation of the information (A Nabie, 2016).
(f) Courteous: Use of polite language always helps in understanding the information in a
better way. It removes the emotional barriers of the receiver and helps him in getting
the exact meaning of communication (DD Qian, 2019).

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BUSINESS COMMUNICATION THEORIES
(g) Complete information: Incomplete information and messages will results in a very
high level of misunderstanding. Companies should always use complete sentences
with full information which it wants to deliver to the receivers (Bank, Guidelines for
Communication between, 2020).
Conclusion
Effectiveness of business communication plays a very important role in the success of the
business of any organisation. Common Wealth Bank of Australia also uses the
communicative strategies including internal and external communication in order to promote
their business. On the bases of the analysis of the communication practices of CBA, it can be
said that barriers in communication always exists. However the bank is very actively
communicating over social websites and its official websites. CBA is promoting its brand and
products with the help of effective communication strategies on mobile apps and other digital
sources. The bank should work on improving its communication strategies by using methods
to remove barriers in communication.

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BUSINESS COMMUNICATION THEORIES
References
A Nabie, B. O. (2016). Effective communication: a key component to reduce workplace
stress. International Advanced Journal of Teaching and Training, 2(5), 15-21.
Australia, P. (2007). Commonwealth Bank Staff Community Fund launches another round of
Local Grants. Retrieved January 20, 2020, from
https://www.philanthropy.org.au/blog/view/commonwealth-bank-staff-community-
fund-launches-another-round-of-local-gran/
Bank, C. W. (2020). Bank accounts:Explore our range of everyday and savings accounts,
with award-winning features to help you stay on track and in control of your money.
Retrieved January 18, 2020, from https://www.commbank.com.au/bank-
accounts.html?ei=hp-pro-c1-p1-bacct
bank, C. W. (2020). CommBank Staff Foundation. Retrieved Jnauary 20, 2020, from
https://www.commbank.com.au/about-us/opportunity-initiatives/opportunity-from-
community/commbank-foundation.html
Bank, C. W. (2020). Community Grants. Retrieved January 20, 2020, from
https://www.commbank.com.au/about-us/opportunity-initiatives/opportunity-from-
community/commbank-foundation/community-grants.html
Bank, C. W. (2020). Guidelines for Communication between. Retrieved January 18, 2020,
from https://www.commbank.com.au/about-us/shareholders/pdfs/corporate-profile/
Guidelines_for_Communication_16_July_2010.pdf
Bank, C. W. (2020, January 21). Investor centre:Information on our securities, financial
results, announcements, sustainability reporting, and other disclosures. Retrieved

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BUSINESS COMMUNICATION THEORIES
January 18, 2020, from The website of common wealth bank of Australia:
https://www.commbank.com.au/about-us/investors.html
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https://pdfs.semanticscholar.org/5c88/3d975a8cf034e93088311c50d8c1f8b5eb63.pdf
CD Maier, S. R. (2019). Bridging diversity management and CSR in online external
communication. Corporate Communications: An International Journal, 24(2), 269-
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DD Qian, M. P. (2019). Politeness in Business Communication: Investigating English Modal
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Durkin, P. (2019). Big four banks' $37m charity boost prompts Hayne payback warning .
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Forbes. (2020, January 9). The World’s Largest Public Companies. Retrieved from The
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BUSINESS COMMUNICATION THEORIES
M Brunton, A. K. (2015). Are strategic communication management competencies and
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MASJEDI, Y. (2020). What is Business Communication & Why Do You Need It? Retrieved
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communication.html
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You-Back-Directors-Cut-30
R Piehler, M. S. (2019). Employees as a second audience: the effect of external
communication on internal brand management outcomes. Journal of Brand
Management, 26(4), 445-460.