Internal And External Communication

Communication is the pillar on which organizational success depends. There are mainly 2 kinds of communication that happen in a corporate environment, and they are internal and external communication. The main difference between internal and external communication lies in the audience to which the message is delivered, and both forms of communication support different business goals. Both internal and external corporate communication are significant resources for the business.

Let us understand this with an internal and external communication example. Suppose you need to convey an important idea to your project manager. There would be some internal communication tools that you would employ in achieving this. Now, if the same idea is to be used to pitch for your company in some other firm, there would be different means and methods used for presenting this information. This is where the difference between internal and external communication comes into play.

What is Internal Communication?

Exchange of information between members of an organization or different parts (or departments) of an organization comes under the internal communication umbrella. The different means used to transmit this information could be emails, phone, personal contact, intranet, or other modern employee communication platforms. Internal communication helps employees of an organization perform their work effectively and gives them a clear sense of the organization's mission. 

There Are 5 Types of Internal Communication

  1. Vertical – This happens between employees present at different hierarchical positions in the company.

  2. Horizontal - This happens between employees present at the same hierarchical positions in the company.

  3. Downward – This internal communication happens from managers, leaders, or executive directors to their assistance or other employees.

  4. Upward – This is the communication from employees and assistants to their managers or leaders.

  5. Diagonal – There are situations when vertical (either upward or downward) channels need to be filled. This is where diagonal communication happens.

Internal communication could also be categorized as informal or formal internal communication.

  • Formal Internal Communication – Any communication that goes through a predefined channel falls under formal internal communication. This flow of information is controlled and follows a chain of command.

  • Informal Internal Communication – This is a multi-dimensional communication that moves freely around the organization. This is a very natural form of communication among people and arises out of social and personal needs. 

Different Ways of Internal Communication

The different means of internal communications are:

  • Emails

  • Staff meetings

  • Personnel meetings

  • News bulletins

  • Company’s internal server

  • Telephone

  • Company blog

  • Online tools like Google calendar and Google drive

What is External Communication?

External communication encompasses interaction within the company as well as with the outside environment like customers, vendors, clients, investors, government agencies, society, etc. These are mostly documented pieces of information. External communication happens between organizations and the outside world daily. The two broad categories of external communication are:

  • Formal External Communication – This kind of communication is the first step in creating an image of the company and brand awareness. Various media like letters, reports, web pages, or presentations are used to showcase a favorable image of the organization. It is also used to provide information about the company’s products and services.

  • Informal External Communication – The organization does not directly regulate this kind of communication. It mostly happens when employees talk about their organization and its quality to other people outside the company. Employees are daily absorbing tons of information about the company. When these employees with in-depth information about the company speak about it to the outside world, it forms a channel for external communication.

Different Ways of External Communication 

The ways in which external information can transpire within and outside the organization are:

  • Print and broadcast media.

  • Pamphlets.

  • Press conference.

  • Annual reports and letters.

  • Business meetings.

  • External electronic communication like emails, phones, etc.

Comparison Between Internal and External Corporate Communication 

Here is a table outlining the key differences between internal and external corporate communication.

Parameter for Comparison

Internal Communication

External Communication


It takes place between members or departments within an organization.

It happens between the organization and external parties.


It can be formal or informal.

It is mostly formal.


Transfer of information between different units of business for its smooth and efficient operation.

To build a company image and foster external relationships.


Employees and management.

Customers, the general public, shareholders, investors, etc.

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FAQ (Frequently Asked Questions)

1. Define the Process of Communication

The process of communication involves a cycle beginning as a message from the sender to the receiver and ending as feedback from the receiver to the sender. The elements involved in this process are shown in the diagram below.

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  • Sender – It is the person who transmits the information in the form of an idea, picture, report, etc.

  • Message – This is the information conveyed in words or write-ups. The form of the message depends on the nature and importance of information passed.

  • Encoding – This is the process of putting the target message in a suitable medium. The medium could be verbal or non-verbal. This is an important step since a wrong encoding can defeat the purpose of communication.

  • Channel - This is the mode or link between the sender and the receiver through which information flows. The various channels could be phones, emails, memorandums, etc.

  • Receiver – The person or the group, receiving the message.

  • Decoding – This is the process of converting the received message into an understandable form.

  • Noise – This is the hindrance in effective communication; a few examples are language barriers, physical distractions, etc.

  • Feedback – The response of the receiver to the sender is termed as feedback. This is the ultimate purpose of the whole communication process since it implies that transmitted information has been successfully encoded, decoded, and comprehended.

2. What are the Rules and Principles of Communication?

All the interested parties who take part in either internal or external communication should follow a few basic principles of communication, which are:

  • Promptness – The receiver must respond to the sender’s message with efficiency (usually within 24 hours). In case it is not possible to give a detailed response in the given timeframe, one must send a preliminary response to the sending party stating that a complete response would follow soon.

  • Validity – The information presented must be true, valid, and documented. They must be based on facts.

  • Confidentiality – There is an obligation to not disclose trade secrets and other confidential information outside the sending and receiving parties. This reliability of correspondence must exist irrespective of the subject matter of the information being shared.

  • Clarity – Information shared must be concise and precise. What one wants or decides must be unequivocally pointed out in the medium of exchange.

3. Why do Internal and External Communication Go Hand in Hand?

Internal and external communication do not work in silos in a business context. Even if internal and external communication has different audiences, they need to align their efforts to give a unified message. Some of the reasons why they need to go hand in hand are:

  • Strategic Alignment - Various stakeholders cannot come to a strategic alignment if the employees are not aware of what the external communication departments are working on. They need to align to understand the overall business strategy.

  • Aligning Brand Image - Business must strive to have no gaps as far as their products, advertising efforts, and customer services are concerned. It is achieved by aligning the brand from inside out. This means they need to equip every employee with knowledge and tools to deliver what is expected as a brand promise.

  • Staying up to Date with Industry Trends - The important news about company events and trends must be imparted to both the employees and the customers. Employees must know what the business is trying to convey to the customers. For this, internal and external communication channels must work in tandem to create personalized message feeds for both parties.