10 Reasons Why Internal Communication Is Important for Businesses

Internal communication is among the most vital factors that determine the level of success for a business. While businesses can survive without having an effective internal communication setup, it is hard to predict the fallouts that may happen among team members anytime due to poor communication.

To ensure that businesses stay put and progress only in the forward direction, they need to strengthen their internal communication. If people within an organization can’t communicate effectively amongst themselves, team collaboration becomes a non-existing entity for their business.

Before we discuss why internal communication is important, let us learn what defines it.

What Is Internal Communication?

Internal communication (IC) is a process that involves the interaction of the people working within a team or an organization to achieve a common set of goals and objectives.

When internal communication happens, there’s a flow of messages containing useful information, among the individuals. The exchange of messages helps team members to coordinate and collaborate and accomplish their predefined group objectives.

Internal communication can be formal or informal depending on the channels used for transmitting messages. Usually, organizations prefer using channels that allow workers to communicate formally.

Some of the most popular communication channels used by business organizations are:

Role of Listening in Communication

Role of Listening in Communication

Many of us misconceive communication as a process that prioritizes talking over listening. However, this is a belief that we need to keep at bay to involve ourselves in productive conversations.

To understand it better, consider yourself talking and sharing your ideas with one of your colleagues or a teammate. At the end of the conversation, you found that they have no idea what you were talking about for the past 15 minutes.

Why did it happen?

Poor listening is the main factor that restricts conversations from becoming effective. Thus, remember that while communicating with your colleagues you always need to be a good listener.

Statistics show that 70% of employees have poor listening habits, which results in misunderstandings, arguments, errors, and stalled projects. The lack of good listening skills leads to understanding and absorbing only half of the conversation immediately after it. In 48 hours, the average conversation retention drops to under 25%.

This is a clear indication that listening is the core of communication. So, to make sure that employee communication works for you in your workplace, hone your listening skills.

The importance of business communication

The importance of business communication - survey results

Remote Work

Remote Work - survey results

Remote Work - survey results

Now, you know the role of listening in communication, it’s time for you know what makes internal communication the foundation stone of team collaboration

10 Reasons That Signify the Importance of Internal Communication

In the absence of internal communication, team efforts become directionless, ideas lost, and conflicts among team members become an ever-growing concern.

Following are 10 reasons that’ll help you perceive the special importance of internal communication in any organization:

1. Helps to build professional relationships

Despite working in a space crowded with several people, your employees may feel disconnected.

And that happens when internal communication is pushed into the background.
When people of an organization communicate with one another quite often, they strengthen the bond between them.

Moreover, if the communication channels are flexible, then employees can even share their personal experiences. As a result, the professional relationships among them get fueled by trust and mutual respect.

Moreover, with good internal communication, it becomes possible for your employees to build a sincere relationship with their managers and team leaders, which eventually smooths the workflow of your business.

Usually, the best way to help employees mingle and build meaningful relationships with each other is to involve them in various team-building activities. Moreover, these activities tend to boost the morale of employees, and at the same time simplify the employee onboarding process.

If you are managing a remote team, then you can use virtual team building activities to bring them together and stimulate interaction among them.

2. Improves employee engagement

Improves employee engagement

Internal communication allows employees to understand the goals of the business, participate actively in devising plans and strategies to achieve those goals, and get appreciated for all their efforts.

When employees know that their contributions are valued and appreciated, they push themselves to be at their best at work every day.

When you establish two-way communication channels in your organization that are open to everyone, employee engagement flourishes.

Employees who are engaged with their work tend to do their everyday tasks passionately and feel motivated to do so. Also, they connect themselves with the vision and the values of the organization.

Good internal communication is a key factor that drives employee engagement.

If your organization has engaged employees, you will notice that they are more loyal, focused, enthusiastic, and committed to the success of the organization and as well as their well-being

3. Makes teams stronger

It’s a fact that teams can’t grow stronger when they can’t communicate and coordinate properly.

When your team has large communication gaps, there tends to be an abrupt and untimely flow of information. As a result, misunderstandings arise and teams fall apart.

On the contrary, if your organization follows effective internal communication practices, then it becomes realistic for teams to deal with every situation in a proactive manner. Moreover, every team member will take responsibility for their actions, and thus the teamwork will stretch in the right direction.

Additionally, by staying in touch with one another over text chats, audio calls, video calls, or face-to-face meetings, every team member stays informed of what they need to do at a given time. Also, there will be harmony in the team and team members will feel connected as a group.

4. Ensures transparency

The biggest and the most evident challenge that weak internal communication spurs in an organization are rumors.

If your organization’s internal communication strategy is weak or if there isn’t one, you are likely to observe that rumors circulate so frequently in your organization that you can’t even trace their origin.

However, if every, or we can say that most of your employees know what is happening within the organization, it becomes difficult for rumors to thrive.

So, what good internal communication does is that it keeps everyone informed and helps to maintain a high level of transparency among employees. No one likes to be kept in the dark and work like a programmed device without knowing the bigger picture.
When there’s no secrecy involved in the flow of information, your employees will focus more on talks and discussions that are productive and mostly related to the work.

5. Lowers chances of conflict

When people get together and work together to achieve shared objectives as a team, conflicts become unavoidable.

One of the most common reasons for conflicts to arise among the members of a group is the difference in their ideas and beliefs. However, it doesn’t mean that you can’t minimize internal conflicts among your employees.

Generally, the ideas of every individual differ from the ideas of others in some way. However, to avoid a conflict from happening whenever two or more employees share their ideas is to encourage them to communicate with one another.

Now you may be thinking, Why do they need to communicate?

The answer is quite simple, every person sees things from their perspective and builds perceptions based on their observations. So, to understand the beliefs and perceptions of one another, they need to communicate. And, the internal communication acts as a window to learn the thought process of others.

6. Establishes a good work environment

It’s the work environment that decides whether your employees are going to stay with you for many years to come or leave as soon as they get even a slightly better opportunity.

Internal communication plays a pivotal role in establishing a good work environment and the culture of your organization.

You should consider the work environment of your organization to be fine if your employees feel both excited and satisfied with their work.

An internal communication strategy that is well-defined helps you to develop a culture that allows employees to interact with one another, stay updated with all the happenings in and out of the business, and step up to share their thoughts, etc.

When employees feel that they are an active part of the organization, the chances of retaining them become better.

7. Promotes feedback among employees

Promotes feedback among employees

When an individual or a team is unaware of the results produced by their efforts, they can’t assess their performance and the areas that need improvement.

The similar is true when you have no idea of what your employees need from the organization to improve the output of the business.

The single thing that can eliminate both the situations mentioned above is feedback.
An effective internal communication strategy prioritizes constant feedback and makes it possible by enabling two-way communication.

The feedback needs to be enabled between employees, employees, and their immediate supervisors, and between supervisors and C-level executives.

Employees and managers can immediately share their responses, which will help them to take corrective actions if things are not moving as planned.

Also, as a business owner, you will get feedback from employees regarding their experience working in your organization.

8. Allows to deal effectively with crises

Businesses do not sail smoothly all the time and there may be situations when things start to go south and give rise to a crisis.

At such times, internal communication becomes the most important thing that can prevent your employees from panicking.

With adequate transparency in communication, individuals at the management level can share the exact details of the crisis with the employees.

Also, employees will have several questions regarding the emergency and they will seek answers from their managers.

A good internal communication set-up will allow you to have difficult conversations with your employees. Maintaining transparency even in dire situations will make your employees feel that you care for them and they need to stand together to get through the difficult times.

However, if employees do not get the answers they seek during times of crisis, they will fall apart and there will be nothing but chaos.

9. Assist with employee management

Managing employees efficiently is easier said than done, especially when an organization has hundreds or thousands of employees.

To manage such a huge workforce, internal communication can be of great help.
If you use robust communication tools, then it becomes much easier to address the growing concerns of employees.

Also, employees will feel secure and connected to your organization if they feel that you consider their feedback seriously and care for their wellness.

Employees will coordinate with you and it will become much easier to manage them and exercise HR department policies without facing any issues.

Employee management policies that ignore the needs and issues of employees tend to fail miserably when put into practice.

10. Drives the growth of the organization

To understand the point here, you need to compare your organization with a machine having several interconnected parts that work together harmoniously to make the machine work properly.

The employees and teams act as those machine parts and are responsible for driving the growth of your organization.

Internal communication is the main force that binds everyone and assists them to coordinate their efforts to achieve the goals of your organization.

When an organization keeps accomplishing its goals effectively and on time, the business grows and so do the employees who are responsible for the organization’s success.

A lack of internal communication delays the information to reach its intended destination, which, in turn, will delay actions required to attain the business objectives successfully.

Conclusion: Why Is Internal Communication Important?

Internal communication is important as it helps create a sense of purpose, unity, and belonging among employees. It improves productivity and ensures that everyone is working towards the same end goal. A good internal communication strategy allows employees and teams to collaborate effectively and helps them better understand the business goals and plans.

After going through all the reasons that we have discussed above, you are most likely to get a clear idea of how valuable internal communication is for every business. So, whether you are a business owner or a team member, you have to put effort into making internal communication successful for your organization.


How can effective internal communication be achieved?

To build an effective internal communication strategy, it is important to recognize the importance of internal communication within your organization. Different communication channels such as an intranet, employee feedback, and regular company updates can be used to share information and guide your internal communications.

What are some key elements of a good internal communication strategy?

A good internal communication strategy should include clear objectives, effective communication channels, regular evaluation of communication methods, and the use of internal brand voice to ensure consistent messaging.

Why is internal communication important for employee engagement?

Internal communication is important for employee engagement because it creates a sense of transparency, empowers employees to share their thoughts and ideas, and makes them feel valued and connected to the company. This leads to higher levels of job satisfaction and productivity.

What are some key performance indicators to measure the success of internal communication?

Some key performance indicators to measure the success of internal communication include employee satisfaction surveys, communication channel engagement metrics, feedback from managers, and the impact of internal communication on business goals and objectives.

How can internal communication help build a strong company culture?

Internal communication plays a crucial role in building a strong company culture by ensuring that employees understand and align with the company’s values, goals, and vision. It facilitates open and transparent communication, promotes collaboration and teamwork, and encourages employees to take pride in their work and the organization.

How can internal communication benefit both internal and external stakeholders?

Successful internal communication not only improves communication within the organization but also has a positive impact on external stakeholders. It helps ensure consistent messaging, enhances brand reputation, and fosters strong relationships with customers, suppliers, and partners.

What are some best practices for internal communication?

Some best practices for internal communication include having a clear internal communication plan, using a mix of communication channels that are accessible to all employees, listening and responding to employee feedback, regularly updating and sharing relevant information, and recognizing the importance of two-way communication.

Vartika Kashyap

Vartika Kashyap is the CMO at ProofHub and has been one of the LinkedIn Top Voices in 2018. Her articles are inspired by office situations and work-related events. She likes to write about productivity, team building, work culture, leadership, entrepreneurship among others and contributing to a better workplace is what makes her click.

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