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Internal Communication and Its Impact on Organizational Performance


Discuss About The Financial Implications Including Return On Investment?

The topic revolves around the concepts of implementing communication strategies and the impact of communication on emotions and behaviours of individuals. Communication between organisations is essential, and it is seen that if a senior person like manager or leader criticises an employee by using bad words "You stupid idiot", it will not only affect his emotions negatively but will also de-motivate him and furthermore deteriorate his performance (Downs & Adrian, 2012).

The internal communication strategy is developed for engaging the employees largely as well as enable proper advocacy program to focus on interacting with the staffs with ease and effectiveness. The manager or leader is responsible for developing internal communication strategies and ensure that all the staffs of the organisation interact with each other. Internal communication can also reduce chances of misunderstanding and negative mindset among individual when the leader will criticise or use bad words like "you stupid idiot", as seen from the case study (Goetsch & Davis, 2014).

The PEST analysis determines the political, economic, social and technological factors that can create an impact on the communication strategies (Conrad & Poole, 2012).

The political factors include the development of contracts and change in policies of Government, which can make the leaders talk to the co-workers politely and make sure that they are kept motivated and encouraged. This would allow them to perform better as well as enhance the organizational productivity (Kasper & Kellerman, 2014).

The condition of the economy must be assessed and monitored for determining the market conditions and enable the leader to communicate with the employees and make them understand their roles and responsibilities to improve the workforce effectiveness (Downs & Adrian, 2012).

The development and implementation of communication strategies can help the managers and leaders to interact with the staffs frequently and ensure social welfare of individuals (Richmond, McCroskey & Powell, 2012). The communication strategies can allow the manager to discuss certain matters with the employees and make him understand the mistakes done by him rather than blaming or criticising him (Goetsch & Davis, 2014).

The internal communication within organisations is influenced by the implementation of latest technologies. The managers can send emails, messages and get involved in conversations to discuss the problems and ensure that no such bad words like “idiot” are used that can discourage the staffs (Ulmer, Sellnow & Seeger, 2013).



·         The internal communication helps in forming good team structure

·         Good relationship between manager and employees

·         Internal communication reduces misunderstanding and creates positive emotions among employees when leaders or managers respond to them politely and motivate them (Conrad & Poole, 2012).

·         Using bad words like “You stupid idiot” is an offensive verbal message provided by the leader to employees.

·         High turnover of staffs

·         Poor performance and lack of production level (Kasper & Kellerman, 2014).



·         Enable employees to learn from their mistakes and perform harder.

·         Communication with staffs and target markets too.

·         Create dissatisfaction among staffs

·         Deteriorate the organisation’s productivity

·         Low performances issues (Downs & Adrian, 2012)

PEST Analysis and Communication Strategies

The major stakeholders are employees, shareholders and the managers as well. It is important to fulfill the requirements of stakeholders keep them satisfied. The internal communication will enable the manager or leader not to use bad verbal messages and rather talk with them politely and make them understand their mistakes and how those can be rectified (Goetsch & Davis, 2014).  

Reference to organisational business and strategic plans

The employees through internal communication must properly understand the business goals and strategic plan. This would make them perform their roles properly and not commit any mistakes, which might make them listen to bad words by the manager that could affect their emotions negatively (Kasper & Kellerman, 2014).

Legal and ethical considerations can create a good culture and working atmosphere and allow employees to perform properly. This would make the leader praise their performance rather than de-motivating them through use of bad words (Ulmer, Sellnow & Seeger, 2013).

There is a necessity to present clear communication and prevent the communication barriers as well. The email conversations, chat messages, etc. are proper channels for enabling communicating rather than criticising the employees for his mistakes in front of the other employees. There could be language and cultural barriers, which might enable an individual not to understand what the others are saying and create issues (Conrad & Poole, 2012).

Budgeting procedure can keep the financial attributes kept under control and motivate the staffs by providing them with training sessions for improving their performances. This would create a positive impact on their emotions and bring enhanced productivity through good rates of return as well (Downs & Adrian, 2012).

Electronic media channels including emails, chat messages, video conferences can be effective for managing internal communication (Richmond, McCroskey & Powell, 2012).

Internal communication strategy reduces the chances of misunderstanding among individual and creates better scopes for influencing the behaviours of workers easily rather than blaming them for their mistakes by using some bad words (Goetsch & Davis, 2014).

The political factors include Government laws, rules and regulations that allow the manager or leader to communicate with the external stakeholders like shareholders, business partners with ease (Ulmer, Sellnow & Seeger, 2013).

The growth in the economy can enable the organisation to invest money on training and development for rectifying the mistakes committed by outside people and furthermore ensure good messages are transferred to them so that a positive sense of belonging and behaviours are established (Conrad & Poole, 2012).

Strengths, Weaknesses, Opportunities, and Threats of Internal Communication

Managing external communications is useful for assessing the target markets and find out ways to fulfill their needs and requirements rather than criticising them (Kasper & Kellerman, 2014).

The advancement of technology has given rise of various digital communication media, which can improve the efficiency of external communications too.



·         Create positive emotions among individuals

·         Improves the organisation’s performance

·         Improve problem solving skills

·         Negative mindset created due to bad verbal messages exchanged

·         Deteriorates the production level of organisation

·         High turnover of employees (Richmond, McCroskey & Powell, 2014).



·         Fulfill requirements of external stakeholders

·         Allow for business growth and engage external stakeholders together properly

·         Employee turnover

·         Degraded performance and threats of reduction of many employees (Downs & Adrian, 2012)

The external stakeholders are customers, shareholders or investors, suppliers, business partners and creditors and if they listen to any such bad words then they may feel discouraged, and there can be further lack of investments, low quality supplies delivered, etc. (Ulmer, Sellnow & Seeger, 2013).

Reference to organisational business and strategic plans

Digital or electronic media could be used for compiling with the strategic plans and manage proper external communication as well (Goetsch & Davis, 2014).

The legal and ethical considerations are done for managing changes and improvements in the external communication process and furthermore ensure that every external individual with whom communication is done is treated properly with respect and dignity (Conrad & Poole, 2012).

Proper communication channels are established for fulfilling the needs of external communication and make sure that they understand them (Kasper & Kellerman, 2014), do their roles and responsibilities with ease and no mistakes.

Communication barriers, technology and cultural barriers can hinder the successful completion of external communication process too (Downs & Adrian, 2012).

The budget must be maintained for keeping costs under control, manage proper use of digital media for enhancing the efficiency of the external communication process, and furthermore gain good rate of return based on the investments made (Richmond, McCroskey & Powell, 2012).

  • Accessing the media

The manager must use the digital media to guide the team members in the right direction (Goetsch & Davis, 2014).

  • Contributing to and updating the media

The up gradation of data is essential for improving the communication process effectiveness and manages good interaction with the stakeholders too (Ulmer, Sellnow & Seeger, 2013).

  • Monitoring the media

Skilful individuals are assigned to use the digital or electronic media and ensure proper communication between individuals. This would also make sure that any bad verbal messages do not get exchanged between the managers and employees within the workplace (Kasper & Kellerman, 2014).

  • Evaluating the media

The digital or electronic media has been chosen as effective for enhancing the efficiency of external communication strategy (Richmond, McCroskey & Powell, 2012).


The topic included the various components required for developing a proper internal communication plan or strategy. The PEST analysis, SWOT analysis along with the stakeholders and strategic plans had been illustrated here as well. Information about channels of communication and financial implications such as budgeting and return on investments along with the utilisation and efficiency of digital media for enhancing the efficiency of communication strategy had been included here as well.


Conrad, C., & Poole, M. S. (2012). Strategic organizational communication: in a global economy. John Wiley & Sons.

Downs, C. W., & Adrian, A. D. (2012). Assessing organizational communication: Strategic communication audits. Guilford Press.

Goetsch, D. L., & Davis, S. B. (2014). Quality management for organizational excellence. Upper Saddle River, NJ: pearson.

Kasper, G., & Kellerman, E. (2014). Communication strategies: Psycholinguistic and sociolinguistic perspectives. Routledge.

Richmond, V. P., McCroskey, J. C., & Powell, L. (2012). Organizational communication for survival. Pearson Higher Ed.

Ulmer, R. R., Sellnow, T. L., & Seeger, M. W. (2013). Effective crisis communication: Moving from crisis to opportunity. Sage Publications.

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