SLM-Unit 10 (1)

Business Communication Unit 10

Sikkim Manipal University Page No. 224

Unit 10 Internal Business Communication – Electronic

Media and Shareholder Communication

Structure:

10.1 Introduction

Objectives

10.2 Intranet

Advantages and disadvantages of intranet

10.3 Communicating through e-mail

Principles of e-mail communication

e-mail etiquette

10.4 Communication through Instant Messaging

Three step process for successful IM

10.5 Communication with Shareholders

10.6 Summary

10.7 Glossary

10.8 Terminal Questions

10.9 Answers

10.10 Case Study

10.1 Introduction

In the previous unit, we studied communication within the organisation through

written channels, including memos, circulars and notices. Computers, the

Internet and the intranet have revolutionised the way communication takes

place in organisations. Memos, circulars and notices can be sent to employees

within the organisation using electronic mail or e-mail. In this unit, we will learn

the significance of intranet and e-mails in business communication.

Some interesting facts about e-mail usage

On an average, a business user receives 25 e-mail messages per

day and this is increasing by 10% per year.

On an average, a business user spends 2.6 hours per day reading

and responding to e-mail.

About 38% of employees have sent an e-mail without the required

attachment.



It takes 77 minutes a week for an employee to manage his/her

mailbox, doing tasks such as cleaning out old messages and filing old

messages or attachments.

It takes 27 minutes for a user to delete or archive enough messages

in order to be able to use the e-mail system again after hitting a

’quota limit’.

It takes 8.2 minutes for a user to find an e-mail that is older than two

weeks.

About 60% of business correspondence has grammar or spelling

errors.

About 60% of an organisation's intellectual property is in the e-mail

system.

The typical user stores more than one-half of his/her critical business

information within the confines of the e-mail system.

About 38% of US and UK companies monitor and read e-mails

written by employees.

(Source: http://justinhartman.com/2008/03/03/interesting-email-facts/)

This unit provides answers to the following questions:

What is an intranet?

What are the etiquette one has to follow while writing an e-mail?

In this unit, we will learn the significance of intranet and e-mail in business

communication. You will also learn the importance of Instant Messaging in

business communication and communicating to stakeholders.

Objectives:

After studying this unit, you should be able to:

explain the meaning and purpose of the intranet

list the advantages and disadvantages of the intranet

describe the principles of e-mail communication

describe the etiquette for e-mail communication

identify the importance of Instant Messaging in business communication

recognise why communicating to shareholders is very important



10.2 Intranet

An intranet is a communication network that operates on an internal network

that is exclusive to a particular organisation. This means that only the

employees of an organisation have the authority to access it. This is as

opposed to an ’extranet’, which is also an internal or private website, but where

access privileges are also extended to external stakeholders of the company,

such as customers, suppliers, partners and others.

Although the intranet is better suited for large organisations where distributing

information is an enormous task, a number of smaller companies today are

also using this form of internal communication.

Simply defined, the intranet is a tool for distributing and sharing information of

different types within the company. For example, weekly reports, goals, human

resources related information such as employee benefits and declared

holidays, interactive forms, vacation requests, supply orders, company policies

and even memos and notices can be posted on the intranet.

Apart from large organisations, the intranet is particularly suited for ’virtual’

companies that have only an online presence, as well as companies with

frequently travelling employees and off-site workers, as communicating with

such employees becomes a challenge.

10.2.1 Advantages and disadvantages of intranet

Like any other tool, the intranet has its advantages and limitations. Some of the

primary advantages are:

Discourages grapevine – Grapevine or the informal communication

network, although useful, leads to rumours. When employees are

misinformed, they become dissatisfied and de-motivated. Using the

intranet as an official channel to post information for all employees to

discourages gossip and avoids creating a transparency gap.

Facilitates pre-meeting discussion – The intranet can be used to

discuss and debate ideas prior to a meeting, so that valuable meeting

time is spent focusing only on relevant ideas.

For example, suppose a sales team of five members are required to

make a presentation to the Vice President - Sales, on how to increase

sales during the current year. Instead of each salesperson making a



lengthy presentation during a meeting and then getting ideas reviewed

and approved, a ’discussion board’ can be created using the intranet, a

few days before the meeting. The salespersons could post their ideas on

the discussion board for the VP to review in advance, so that only the

most promising ideas are discussed during the meeting. This way, the

salespersons can come into the meeting more focused.

Saves time – The intranet is paperless communication and is therefore

a big time saver. A lot of unnecessary time wasted on filling out forms,

leave requests, supply orders, etc., can be saved by doing this through

the intranet.

Employees can get information on official holidays and other Human

Resource (HR) related information, without having to interact with the

HR manager.

Is superior to e-mail – Sending some types of information through

e-mail can sometimes create confusion and information overload. For

example, consider that five salespersons want to meet and give a

presentation to the Vice President – Sales, on how to increase sales. If

each one of them has three different ways in which they could increase

sales and start e-mailing multiple versions of their Power Point

presentations to the Vice President for review, it could lead to disastrous

results. Instead, they could work on a shared file, by using the intranet.

The intranet allows you to create a central location where you could

save your most recent file.

While the intranet saves valuable time and money, it has some disadvantages.

Before an intranet is set up, a lot of groundwork needs to be done. You need to

determine what you want it to do and how employees will use it. Some of the

important disadvantages of an intranet are:

Getting started – Building the intranet to your specifications can be

expensive. A consultant may have to be hired to give it the desired look

and feel and to make sure that it is user friendly and simple enough for

all employees to use.

Developing and maintaining content – Once the intranet has been set

up, someone has to be responsible for maintaining and updating the

information on a continuous basis. In small organisations, it may be



sufficient to appoint one person to do this. In larger organisations with

multiple departments, it may be necessary to appoint several persons to

maintain and update information for the different departments. This

becomes a complex and expensive task.

Training employees – Once the intranet has been set up, employees

have to be familiarised and trained on how to use the intranet. This

involves investment in time and money.

Convincing ‘old economy’ employees – Some employees may not be

technology or computer savvy and may be reluctant to use the intranet

to access information. Therefore, they may have to be convinced about

the benefits of using the new technology.

The following case study illustrates how an intranet must be designed and used

as an effective communication tool.

Rand Library Intranet

The Rand Library is part of a non-profit research institution based in

Santa Monica, California, USA. It helps to improve policy and decision

making of federal, state and local governments through research and

analysis.

The RAND library intranet has been designed with the objective of being

an interactive tool that helps library staff and clients communicate

regularly with each other. Another objective is to constantly update the

information available to its customers. This does not require an IT

specialist and can be done by any library staff member.

Their intranet communication strategy includes three components: an

updated home page, an e-mail alert service and several e-mail links. The

home page contains the library logo and a menu, which are standard

components, while the body of the page is changed at least once a week.

The home page includes internet sites that may be of value to their

research staff, as well as announcements regarding library news, new

services and policy changes.

The e-mail alert service includes e-mail distribution lists for topics such as

Health Care, Science and Technology. Once a person signs up for the

e-mail alert service for one of these topics, the person receives regular

e-mails pertaining to these topics.



Multiple e-mail links are used to make the communication two-way. This

means that the clients can login to the intranet site and make requests for

books, research articles, etc. They can also click on a “Contact a

Librarian” link that brings up the name, job title and photograph of each of

the reference librarians.

Additional Reference:

Thompson, S. (2002). Communicate in the Workplace. Australia: Max

Johnson.

Self Assessment Questions

1. An intranet is similar to a __________________, except that it operates

on an internal network that is exclusive to a particular organisation.

2. The intranet can be used to discuss and debate ideas prior to a meeting.

(True/False)

3. Identify the advantage of the intranet. (Pick the right option)

a) Building the intranet

b) Maintaining content

c) Superior to e-mail

d) Encourages grapevine

4. In large organisations, it may be sufficient to appoint one person to

maintain the intranet. (True/False)

10.3 Communicating through e-mail

Although e-mail is a tool for external communication, it is also regularly used

within an organisation, in place of telephone and face-to-face communication.

This is because e-mail is instantaneous and allows you to send messages that

others can pick up at their convenience. Besides, e-mail also makes it possible

to send messages to people anywhere in the world and to people who are

otherwise impossible to reach.

While the other forms of written communication are highly formal in nature,

e-mail is more informal and spontaneous. It is therefore easier to write an

e-mail message than it is to write a business letter or a report, where greater



attention has to be paid to the language, style and tone. As e-mail is quick,

easy to use and spontaneous, it can also help to improve personal relationships

in the workplace.

Two of the most primary types of business communication e-mails are as

follows:

Business-to-Customer (B to C) e-mails – If the business

communications or a transaction happens over e-mail, directly between

the company and consumers it is called B to C e-mails. Usually

companies that sell products directly to consumers can be referred to as

B to C companies. These companies (like online retailers) communicate

with their customers via e-mails. .

Business-to-Business (B to B) e-mails – This type of e-mail

communication happens between two businesses for example, when the

manufacturer sells the product to a wholesaler. Let us now study the

principles that you need to follow while communicating over e-mail.

10.3.1 Principles of e-mail communication

The principles of communicating through e-mail are a little different from the

principles of written communication, as e-mail is more informal in nature. Figure

10.1 depicts the principles of e-mail communication.

Fig. 10.1: e-mail Communication Principles



Let us now discuss the principles shown in figure 10.1 in detail.

Watch the content – e-mail messages are not always confidential and

one can never be sure who will read them. The minute an e-mail

message is sent, multiple copies are created on your own Personal

Computer (PC) and server. At the same time, a copy is also created on

the recipient’s PC and server. There is no way of ensuring that the

message will not be forwarded to others. Sometimes, e-mail messages

can even be used as proof in court. Once a message is sent, a

permanent record is created. Therefore, it is always wise to avoid writing

anything negative or offensive in e-mails.

It is particularly important to watch the content of official. e-mail

messages sent using an employer’s equipment. As the employer has a

right to read the message and is legally responsible for its content, it

must be carefully worded.

Pay attention to the tone – The very nature of e-mail communication

can make the message sound negative, abrupt and rude. For one thing,

e-mail lacks the personal quality of face-to-face communication, where

body language and other non-verbal cues may be used to make the

communication more positive. Secondly, e-mail messages are brief, use

short words and sentences and lack salutations. Brief messages may be

interpreted as being rude and unfriendly. Therefore, you must pay close

attention to the tone of the message and ensure that you sound friendly

and courteous. Avoid using humour and sarcasm which might be

misunderstood or sending messages when you are angry or annoyed.

Include a specific subject line – Your e-mail message must always

include a subject line that clearly mentions the topic of the e-mail. As

business executives receive several e-mails a day, this would help them

to decide which messages are most important to them. They may also

have an idea of what the message contains.

Place important information first – As business executives do not

have time to read lengthy e-mail messages, it is a good idea to put all

the important information that you want to convey in the first three lines

of the message. Whether you are seeking a clarification, making a

request or giving instructions, it is best to mention this right at the outset,

so that it is noticed.



Explain attachments in the body of the e-mail – Attachments take

time to download and must be sent along with an explanation in the

body of the e-mail, as to what they are all about. This makes it easier for

the recipient of the message to decide whether they must be opened or

not. Otherwise it can lead to unnecessary waste of time.

Use the “to” and “cc” button carefully – The “to” box must be used

only to send messages to people who are responsible for doing

something. The “cc” button is used when sending multiple copies of the

same e-mail message to other recipients, who need to be kept informed

on a specific issue. This must be used with care, making sure that the

message is sent only to the right persons. It is important to respect

privacy, as not everyone likes having their e-mail address displayed to

others. Besides, sending a long list of e-mail addresses can interfere

with the reading of the main message.

Pay attention to brevity, emphasis and white space – The look,

appearance and language used in the e-mail message can influence the

readability of the message. Some techniques for enhancing readability

of e-mail messages include short paragraphs (six lines maximum),

spacing between paragraphs, use of bullet points and numbers for lists,

use of paragraph captions, highlighting main points in bold type and use

of white space.

Use the “WIFM” rule – WIFM stands for “What’s in it for me?” and

means that the benefits of your message to the reader must be

emphasised. This involves the use of the second person pronoun, ’you’,

rather than the first person pronouns ’I’ or ’me’. It is important to

stressing on the ’you’ attitude rather than the ’me’ attitude.

Tidy up your mail box – e-mail traffic can lead to your inbox becoming

cluttered, with more messages than you can handle. It then becomes

difficult to retrieve important messages when you need them. It is

therefore a good idea to clean up your mailbox regularly, by deleting

unimportant messages. The important messages that you want to refer

later must be put into separate topic folders. Every now and then, any

outdated messages in the topic folders must also be deleted.

Proofread your e-mail message – Just as it is important to proofread

business reports, letters and memos, e-mail messages must also be



checked for spelling and grammar mistakes, so as to avoid any

embarrassment.

Set aside time to check e-mail – e-mail must not become a substitute

for face-to-face interaction at the workplace or use valuable time that

could be spent on other important jobs. It is a good idea to determine a

certain time during the work day when you can check and respond to

e-mail messages.

10.3.2 e-mail etiquette

Similar to meeting etiquette which we discussed in unit 8, there are etiquette for

writing e-mail messages, which must be strictly followed. They are:

Mind your P’s and Q’s – These refer to the three ’magic’ words,

’Please’, ’Thank You’ and ’Sorry’. They are all the more important in

e-mail messages, which have to be extra polite and friendly.

Avoid ‘shouting’ – Shouting in an e-mail message refers to use of all

capital letters in the text. If only capital letters are used, it makes it

difficult to read a message and is therefore considered to be rude, like

shouting.

Avoid symbols and acronyms – Symbolic messages using

punctuation marks, known as ‘emoticons’ for example, , etc., must

be avoided, especially in business related e-mail messages. Similarly,

abbreviations like BTW for by the way must be avoided as they sound

over casual and may not be understood by everyone.

Use friendly salutations and sign-offs – Although these are not strictly

required in e-mail communication as in business letters, a salutation

such as “Dear John” and a sign-off such as “Warm Regards”, helps to

make the tone friendly and personal.

Respond promptly – In the case of business related e-mails, it is

important to respond promptly, especially when communicating with

superiors. Even if you are hard pressed for time, are out of town or out

of the office, you can set an automatic e-mail response to your received

messages, which will mention that you will be responding in detail on a

specific date.

Avoid personal messages at work – Do not make use of office facility

to send personal e-mail messages. As confidentiality of the message is

not guaranteed, it may lead to embarrassment later.



Avoid sending ’junk mail’ – Do not send irrelevant messages or

messages that are not work related to people at work. If you overload

people with this kind of mail, they will not pay attention to the really

important messages.

e-mail must be used constructively and judiciously, to meet your goals at the

workplace and to enhance your performance.

Some Do’s of e-mail

Use e-mail when:

1. you wish to be a part of a network where you can share information and

receive information from others.

2. you want to contact important people quickly and save time spent in

meetings.

3. you want to send information to a large number of people located across

the globe.

4. you want to establish a professional image. Your language and writing

style on electronic media can say a lot about you, just like your dress and

outward appearance. Watch your spelling, grammar and usage of

English.

5. you want to cut through hierarchy and speed up team projects.

Activity 1:

List three different situations at the workplace when e-mail

communication would be more appropriate for conveying a message,

compared to oral and written channels, explaining why.

(Refer section 10.3 for detailed guidelines.)


5. e-mail is more __________________and _______________________.

(Pick the right option)

a) Informal, spontaneous

b) Elaborate, spontaneous

c) Informal, elaborate

d) Formal, elaborate



6. The very nature of e-mail communication can make the message sound

negative, abrupt and rude. (True/False)

7. __________________________ take time to download and must be

sent along with an explanation in the body of the e-mail.

8. ________________ make it difficult to read a message and is therefore

considered to be rude.

10.4 Communication through Instant Messaging

e-mail is one of the primary medium for business communication. However,

some drawbacks of e-mail such as viruses, spam and extensive overuse are

forcing organisations to explore alternatives. Instant Messaging (IM) is one

such alternative that organisations prefer over e-mail.

Instant Messaging (IM) is a technology initially designed for having one-to-one

personal chat at workplaces. Over the years, many executives, including senior

executives in an organisation prefer text-based IM over phone calls and e-mails

to communicate with other executives, employees and customers within and

outside the organisation. This is because of the immediacy and streamlined

efficiency in communicating real-time information within the organisation that IM

offers.

Instant messaging can happen over the intranet and Internet, but within an

organisation IM happens over intranet. In many large and small business

organisations, IM is extensively used as an important communication tool as it

provides enhanced collaboration and increased opportunities for saving time

and cost. IM offers a range of capabilities for business communication that

includes basic chat, remote display of documents, video capabilities, controlling

other computers from remote location, automated news feed from websites,

etc. In spite of its simplicity, efficiency and reliability it cannot be used to

communicate sensitive and confidential information due to lack of security and

susceptibility to a virus attack.

10.4.1 Three step process for successful IM

Instant messages are often written and sent within a matter of few seconds.

You can follow the steps depicted in Figure 10.2 to write instant messages for

business communication more effectively.



Fig. 10.2: Steps for IM

As shown in figure 10.2, the three steps for successful IM are:

Plan – Think every instant message exchange as a conversation and

take a moment to plan the overall conversation. Make sure you read the

message before you sent. If you are requesting something, ensure that

you are requesting exactly what you need in the most effective way

possible. If a request is being made to you, ensure that you are able to

meet the demand as per the requirement before you respond. It is a

good practice to communicate the information in a coherent and

complete way using minimum number of individual messages.

Write – A formal writing style is more appropriate for business IM. You

must generally avoid short forms such as, 'Thanx' for 'Thanks', 'Plz' for

'Please', 'HTH' for 'hope that helps', etc. It is always good practice to

maintain good etiquette and a professional tone while communicating

business messages using IM especially with customers, stakeholders

and other audience who are not part of the organisation.

Complete – To complete the instant message you have to send it.

Before you send it, select a basic font setting. For example, text style

'Arial' or 'Times New Roman', font size 11 or 12 and font colour 'Black'.

You must also spend some time to revise and proofread the message to

ensure that there are no missing or misspelled words and the message

is clear and complete. Then just click the ‘Send’ button to deliver the

message.

There are many IM tools available for communication over the intranet and

Internet. For example, 'IP Messenger' is a popular tool for IM over the intranet.

'Skype', 'ALO Instant Messenger', 'Yahoo Messenger', etc are examples of IM

over the Internet.



Dos and Don’ts for IM Users

1. Do: Adopt a user policy for instant messaging. If you are an owner, your

employees need to know whether you view IM as an appropriate vehicle to

communicate with, say, customers or business partners. Any policy must

contain at least general guidelines for its use.

2. Don’t: Do not use IM to communicate confidential or sensitive information. If

your company is in the business of providing professional advice regarding

stocks, finances, medicine or law, it is advisable not to use IM. IM is better

suited to send quick information about project status, meeting times or a

person's whereabouts.

3. Do: Organise your contact lists to separate business contacts from family and

friends. Contact lists, also known as ’buddy lists’ contain your menu of

potential recipients for instant messages. Keep your business contacts

separate from family and friends. Make sure your employees do the same.

Eliminate even the remote possibility that a social contact could be included in

a business chat with a partner or customer – or vice versa.

4. Don’t: Do not allow excessive personal messaging at work. Although you can

make personal phone calls at work, send personal e-mails and allow your

employees to do the same, it is better to keep it to a minimum. Ensure that

personal chats are done during breaks or the lunch hour – or that the chats

generate new customers or revenue to the business.

5. Do: Be aware that instant messages can be saved. You may think IM is great

because you can let your guard down, make bold statements, chastise a

boss, employee or co-worker and have it all wiped away from the record when

you are done. What you aren't realising is that one of the parties to your

conversation can copy and paste the entire chat onto a Notepad or Word

document. Some IM services allow you to archive entire messages. Hence,

always be careful what you say, just as you would in an e-mail.

6. Don’t: Compromise your company's liability or your own reputation.

Statements you make in IM about other people, your company or other

companies probably aren't going to land you in court. But they could damage

your reputation or your company's credibility. Again, be careful about what

you say.

(Source: http://www.microsoft.com/business/en-us/resources/technology/

communications/10-tips-for-using-instant-messaging-for-business.aspx?

fbid=PAfflGY1jda)



10.5 Communication with Shareholders

Shareholders are important internal stakeholders of an organisation and they

are the owners of the company. As the capital required to run large

organisations is huge, a group of proprietors and partners cannot fund all the

capital required. Therefore, capital to run an organisation is raised from the

public or private organisations or both and they become the stakeholders or

investors of the organisation. As organisations grow, shareholding is widely

scattered. Therefore, it is essential to retain the shareholders’ confidence in the

company’s management, through effective communication with them on a

regular basis.

There are two situations where shareholder communication is extremely vital:

If the company is doing well and wants to expand its scope of operations

or diversify into unrelated areas. In this case, good shareholder relations

can help to raise the required capital and minimise borrowing from

banks and financial institutions.

If the company is going through a crisis or difficult times, more

communication with shareholders is needed. Take the example of Coke

and Pepsi during the pesticide controversy. In such a situation, the

company must be open with its shareholders and explain the problem

clearly, including the steps being taken to overcome the crisis.

Crisis communication is an important, but often overlooked area of shareholder

communication. Lack of communication during a crisis encourages the

grapevine among shareholders and leads to false rumours. For example,

rumours may spread that the company is going to close down. On the other

hand, if you tell the truth, chances are that your shareholders will stand by you.

The appropriate media for communication with shareholders include both oral

and written channels. Periodic mailers must be sent to all shareholders, giving

a fair and truthful representation of the company’s results and progress on

various fronts. In areas where there is an aggregation or concentration of

shareholders, shareholder meetings and conferences must be held, making

presentations on the company’s progress. When the company is going through

a crisis, shareholders must be taken on project site and factory visits, to show

them the measures that are being taken to solve the problem.



The overall guiding factor in communicating with shareholders must be that

they are the owners of the company.

Two examples are given below of two companies, Cognizant and Reliance that

are well known for effective shareholder communication.

Cognizant’s Communication with Shareholders

Cognizant is a leading provider of IT services, based in New Jersey,

USA. They have won national acclaim in the US financial media for being

one of the most shareholder friendly companies in the US.

In a survey where respondents were asked to rate various companies on

criteria such as financial performance, communication with shareholders,

investor relations and quality of corporate governance, Cognizant was

ranked the highest.

Shareholder friendly companies were described by respondents as those

that are known for their policy of openness and high quality of

communication with their shareholders.

Reliance’s Communication with Shareholders

In India, one out of every four investors is a shareholder of Reliance.

The company has set up a firm of Chartered Accountants as Internal

Security Auditors, to audit the transactions and communication with

shareholders.

The Board of Directors of the company has also appointed a

Shareholders’/Investors’ Grievance Committee, for examining and

responding to shareholders’ complaints with regard to transfer of shares,

non-receipt of balance sheet, declared dividends, etc. The Committee also

makes recommendations on how to improve the overall quality of investor

services.

Figure 10.3 depicts a sample letter written by Reliance to its shareholders.





Fig. 10.3: A Sample Shareholder Letter

(Source: Adapted fromhttp://www.futureventures.in/letter-to-shareholders.htm)


9. Instant Messaging is a technology initially designed for having

_________________________ at workplaces. (Pick the right option)

a) One-to-many public chat

b) One-to-one public chat

c) One-to-one personal chat

d) One-to-many personal chat

10. Appropriate writing style for business IM is _____________________.

11. A good shareholder relation can help to raise the required

_______________ and ________________ borrowing from banks and

financial institutions.

12. Periodic mailers must be sent to all shareholders, giving a fair and

truthful representation of the company’s results and progress on

various fronts. (True/False)



10.6 Summary

Let us recapitulate the important points discussed in this unit:

Intranet is a business communication tool exclusively used for an

organisation's internal communication.

Intranet helps organisation to discourage grapevine, facilitate pre-

meeting discussion and is considered superior to e-mail.

Internet is very expensive to build, and demands regular maintenance.

e-mails are widely used in business communication instead of face-to-

face communication.

We have to follow the following principles to improve the efficiency of the

e-mails that we sent:

o Watch the content

o Pay attention to the tone

o Include a specific subject line

o Place important information first

o Explain attachments in the body of the e-mail

o Use the "to" and "cc" button carefully

o Pay attention to brevity, emphasis and white space

o Use the "WIFM" rule

o Tidy up your mail box

o Proofread your e-mail message

o Set aside time to check e-mail

The following are the etiquette to be followed while using email for

business communication:

o Mind your P's and Q's

o Avoid using all caps

o Avoid symbols and acronyms

o Use friendly salutations and sign-offs

o Respond promptly

o Avoid personal messages at work

o Avoid sending 'junk mail'



Instant Messaging which was initially designed for having one-to-one

personal chat at workplaces, but now-a-days it is used for business

communication.

One has to plan, write and then send instant messages in order to

ensure that the message is formal, clear and concise.

Shareholders are the owners of the company as they provide the

necessary capital for running the company.

It is very important to communicate correctly, regularly and truthfully the

status of the company and issues associated to the company to the

respective stakeholders.

10.7 Glossary

Grapevine: The informal transmission of information, gossip, or rumour from

person to person.

Human Resource: The department or support systems responsible for

personnel sourcing and hiring, applicant tracking, skills development and

tracking, benefits administration and compliance with associated government

regulations.

Savvy: Practical understanding or shrewdness.

Server: A computer that provides services used by other computers.

Spam: Flooding the Internet with many copies of the same message, in an

attempt to force the message on people who would not otherwise choose to

receive it. Most spam is commercial advertising, often for dubious products,

get-rich-quick schemes, or quasi-legal services.

10.8 Terminal Questions

1. What is an intranet?

2. What are the advantages and disadvantages of intranet?

3. Explain the principles that you need to follow while using emails for

business communication.

4. Write a note on Instant Messaging.

5. Which are the two situations wherein communication to the stakeholder

becomes vital?



10.9 Answers


1. Website

2. True

3. c) Superior to email

4. False. In small organisations, it may be sufficient to appoint one person

to maintain intranet.

5. Informal, spontaneous

6. True

7. Attachments

8. All caps

9. c) One-to-one personal chat

10. Being more formal

11. Capital, minimise

12. True

Terminal Questions

1. It is an internal network that is exclusive to a particular organisation. It is

similar to a website and only the employees of the organisation are

authorised to access it. For more details, refer section 10.2.

2. Intranet discourages grapevine, facilitates pre-meeting discussion and

saves time. However, it is very expensive to setup the intranet and

operate it. For more details, refer sub-section 10.2.1.

3. While using emails for business communication watch the content, pay

attention to the tone, include a specific subject line, place important

information first, explain attachments in the body of the email, etc. For

more details, refer section 10.3.

4. Instant messaging is an alternate to reduce the emails for business

communication to certain extent. The three step process - plan, write

and complete can be used to successfully send instant message. For


5. You need to communicate frequently to the stakeholder about the status

of the organisation. However, when the company is doing well and when

it is going through some crisis the communication becomes vital. For




10.10 Case Study

Broadridge International Shareholder Communications Programme

The Allianz Group is a leading global service provider in insurance, banking

and asset management. The company has achieved revenue of over 100

billion Euros in the year 2006. It serves more than 70 million customers

across 70 countries with a strong work force of 173,000. In Germany, Allianz

is a strong market leader in insurance sector.

The Allianz Group is also one of the world’s largest asset managers, with

third-party assets of 764 billion Euros under its management in the year end

2006. Also in 2006, Allianz SE - the parent company - became the first

company in the Dow Jones EURO STOXX 50 Index to adopt the legal form

of a Societas Europaea, a new legal structure for stock corporations.

Objectives:

In order to support its competitive strength and company values, Allianz

Group depends on number of factors. These include global diversification,

complexity reduction, a strong value-based management approach and its

employees. As a result of its success it has attracted lot of investors from

across the globe and the investors are the most important stakeholders of

Allianz. The Group's management gives high significance on sustaining

good relationships with their investors or stakeholders. Allianz uses

Broadridge International Shareholder Communications Programme to

successfully communicate with its large and diverse investor base in a more

direct and efficient manner. This has improved the Group's communication

with its international shareholders and helped to achieve highest standards

in corporate governance.

Outcomes

With the help of Broadridge communication programmes Allianz Group has

become more transparent among its stakeholders. “By working together with

Broadridge, Allianz is assured that any information intended for its non-

resident shareholders, whose custodian banks are linked to Broadridge’s

systems, is sent electronically on a real-time basis, thereby significantly

reducing our overall proxy costs”, said Dr. Elsbeth Pabst, Head of the Share

Register Service, Allianz SE. Allianz was able to receive a daily electronic



report from Broadridge during the final ten days before the general meeting

deadline. This report indicated the number of shareholders who have been

informed of the impending general meeting, the custodial details of those

who have voted and where the votes are located on the return custodial

channel. Allianz is also provided with supplemental information including

exclusive statistics about the chain of intermediaries, the opportunity to verify

whether votes are received on time via the local custodians, as well as

additional data of use to the share registry.

Discussion Questions:

1. Why did Allianz use Broadridge International Shareholder

Communications Programme? Explain.

(Hint: Refer to section ‘Objectives’ in Case Study)

2. Did the use of Broadridge International Shareholder Communications

Programme help Allianz? Explain.

(Hint: Refer to section ‘Outcomes’ in Case Study)

(Source: http://www.broadridge.com/investor-

communications/international /Noblleed - Allianz Case Study.pdf )

Reference:

Bovee, C.L., Thill, J.V., & Chaturvedi, M. (2009). Business

Communication Today. New Delhi: Dorling Kindersley (India) Pvt. Ltd.

E-References:

http://www.microsoft.com/business/en-us/resources/technology/

communications/10-tips-for-using-instant-messaging-for-business.aspx?

fbid=PAfflGY1jda – Retrieved on January 19, 2012.

http://www.broadridge.com/investor-communications/international/

Noblleed - Allianz Case Study.pdf - Retrieved on January 20, 2012.

http://www.investopedia.com/terms/b/btob.asp#axzz1jykg1XMT –

Retrieved on January 20, 2012.

http://www.rcom.co.in/Rcom/aboutus/ir/pdf/RCOM_CCM_Notice.pdf

– Retrieved on February 14, 2012.

http://www.rcom.co.in/Rcom/aboutus/ir/pdf/RCOM_CCM_Notice.pdf

SLM-Unit 10 (1)

Documents