No business activity can be completed without effective business communication network. The stage of economic turmoil is the most important time for any organization to regroup its strategy. At this juncture, strong, transparent and constant internal and external communication networks play a vital role. The global meltdown is a blessing in disguise for the organizations to invigorate their business communication network. The present paper aims to study multifarious approaches of Business Communication applied by Indian Organizations to combat the turbulent period of recession in a successful manner.

D. MEHTA

Naveen K. MEHTA

Rishi MISHRA

English

Research Papers in Economics

Page 2  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
Overcoming Recession through Effective 
Business Communication Approaches 
(A Study in Indian Scenario) 
 
 
Dr. D. MEHTA 
Reader  
FMS Pt. JNIBM, Vikram University 
Ujjain (M.P.) 
E-mail: mehtadnm007[at] ediffmail[dot] com    
 
Dr. Naveen K. MEHTA 
Faculty-Board of Studies 
The Institute of Chartered Accountants of India  
New Delhi 
E-mail: drnknmehta73 [At] gmail [Dot] com 
 
Dr. Rishi MISHRA 
Faculty-Board of Studies  
The Institute of Chartered Accountants of India  
New Delhi 
E-mail: rishimishra77 [At] gmail [Dot] com 
 
 
 Page 3  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
Abstract:   No  business  activity  can  be  completed  without  effective 
business  communication  network.  The  stage  of  economic 
turmoil is the most important time for any organization to 
regroup  its  strategy.    At  this  juncture,  strong,  transparent 
and constant internal and external communication networks 
play  a  vital  role.  The  global  meltdown  is  a  blessing  in 
disguise  for  the  organizations  to  invigorate  their  business 
communication  network.  The  present  paper  aims  to  study 
multifarious approaches of Business Communication applied 
by  Indian  Organizations  to  combat  the  turbulent  period  of 
recession in a successful manner.   
Keywords: communication,  recession,  approach,  organization, 
stakeholders, employees, network. 
 
 
Introduction 
During downturn, it is very vital for any organization to communicate 
to  the  stakeholders  proactively  without  failing  to  strengthen  the 
relationships. Effective business communication is instrumental to narrow 
down  the  gap  during  downturn.  Regular  communication  enables  the 
manpower to perform in a healthy environment. The financial crisis has 
put-forth  great  challenges  before  enterprises.  The  need  of  the  present 
era is that the organizations become  visible and approachable  to their 
employees and thereby provide equal opportunities to their  employees 
and reduce inefficiencies. The organizations need to uphold their values & 
mission so that they are able to answer the stakeholders’ questions and 
concerns  quickly  and  honestly.  The  organizations  that  have  effective 
communication approaches will rule the world of trade and business.  It is 
observed  that  during  recession,  many  companies’  apply  cost-cutting 
measures  and  offer  layoffs  to  their  employees.  It  results  into  an 
environment of fear and doubt. Therefore, the organizations are expected 
to form and work upon their communication approaches.  
 Page 4  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
Review of Literature   
Once George Bernard Shaw stated that the single biggest problem in 
communication  is the illusion that it  has taken place. Research (2000) 
indicates that employees trust leaders who are fair, as demonstrated by 
consistent, predictable, coherent and transparent actions on their part. 
Sparks et al (2001) revealed in their report that High demands and little 
control  over  outcomes  often  make  employees  feel  stressed  and  cause 
them  to  interpret  the  situation  as  unfair.  Wheatley  (2002)  highlighted 
that stress in the workplace often manifests as poor productivity because 
staff members become overly consumed with protecting their individual 
positions. Lowe (2002) observed that healthy employment relations are 
supported  by  four  factors:  trust,  commitment,  communication  and  fair 
decision-making. Craig Hartley-Kite et al (2009) narrate that there is a 
strong need for reassurance and honesty in formal communications about 
the  impact  change  will  have  for  the  business,  its  customers  and  its 
employees.  If  internal  communication  cannot  respond  quickly  and 
effectively  to  this  it  creates  a  communications  vacuum  and  employees 
look elsewhere to feed their information needs. External communications 
and media are a starting point for them, but they also have a greater 
reliance  on  rumour,  the  grapevine  and  union  communication.  Watson 
Wyatt Report (2009) exhibits that the companies plan to communicate 
with workers about the impact of the downturn on the business, going 
forward.  Aniko  Czinege  (2010)  stated  that  in  the  period  of  global 
economic downturn, there is a great deal of uncertainty in the workplace. 
With many companies heading into survival mode, cost-cutting measures 
and layoffs have lead to a climate of fear and doubt. Job security has 
become  a  primary  concern  for  employees  in  many  industries.  As  the 
future  becomes  less  predictable,  a  company’s  internal  communication 
strategy is vital to its success in navigating a recession. Praxis Consulting 
Group  (2010)  found  that  companies  are  more  likely  to  succeed  when 
employees  feel  that  their  ideas  and  input  are  requested  and  valued. 
Employee involvement is repeatedly cited as a core characteristic of high Page 5  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
performing companies. 
 
Organizations Response to Recession 
Recently, the World Bank in its exclusive report revealed that India 
is expected to slow down to 8.4 percent this year from an estimated 9.5 
percent in 2011.  To meet the set growth target, the organizations have 
to empower their communication modalities. The overall success of any 
organization largely looms upon the effective utilization and integration of 
available  communication  networks  and  keeps  on  researching  novel 
communication mode to face the unseen challenges and threats of the 
corporate  world.  To  some  extent,  Indian  business  enterprises  have 
emerged successful in tackling the manic of recession by developing their 
peculiar  communication  approaches.  The  competition  is  getting  very 
tough and the whole world is looking towards India’s role in this changing 
global  scenario  with  great  expectations.  The  maestros  of  management 
assert that slowdown is the apt time to enhance efforts in marketing with 
more emphasis on quality and to increase its market share. The keys to 
unlock the doors of success during recession rely upon Social networking, 
relevant conversations and healthy public relation.  
 
Communication Approaches to Combat Recession 
Strong,  clear  and  regular  internal  and  external  communication 
networks play a significant role in tackling recession. The recession is the 
exact  time  for  the  organizations  to  regroup  their  communication 
approaches.  Effective  communication  approaches  maneuver  the 
employees to become aware of organizations policies to handle downturn 
One to one communication lessens the uncertainty and fear amidst the 
employees. It develops a healthy environment to reach the set objectives 
of the organization.  Page 6  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
Some organizations also try to downsize their expenses by reducing 
their manpower but it may affect the elements of loyalty and honesty. At 
the  same  time,  it  may  discourage  the  employees.  They  start  thinking 
about  job  security  and  perceive  threat.  To  prevent  such  a  filthy  and 
rumour  driven  environment,  the  best  way  for  the  organizations  is  to 
promote  internal  communication  and  control  rumours  mill.  To  manage 
the rumour mill, the organization should provide the information to its 
employees on regular basis otherwise it may become increase the level of 
resentment  among  employees.  The  next  approach  of  an  organization 
may  be  of  involving  its  managers/supervisors  in  the  decision  making 
process.  The organizations’ approach should be full of honesty, integrity, 
transparency  and  equal  opportunity.  The  management  should  come 
forward to exchange good ideas and success stories. To address these 
issues  printed  or  in-house  magazines  and  newsletters  are  the  best 
available  tools.  Further,  the  organizations  can  promote  two-way 
communication.  Employees’  questions,  concerns,  feedback  and 
suggestions can be invited.  It will certainly provide employees an outlet 
for their views, ideas and concerns. 
The top management should show empathy towards staff’s emotions 
and find out the reasons behind them. Staff meetings can be called on 
periodical basis which may involve opinion polls. 
The  communication  approaches  can  be  developed  on  the  basis  of 
following principles: 
  Communication  processes  must  be  transparent  and  straight 
forward 
  Communication must be effective at all the levels. 
  Communication must be honest, open, and result oriented. 
  Communication must be authentic, reliable and prompt. 
  Communication must have essence of healthy coordination, co
-operation,  motivation,  integration,  innovation,  collaboration Page 7  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
etc. 
  Communication must convey timely feedback. 
  Communication  must  include  latest  mass/multimedia 
communication systems as to save time, money and energy. 
  Communication must develop good team spirits. 
  Communication must develop a sense of better understanding, 
listening and empathy. 
 
Communication  Approaches  in  Recession:    Indian 
Scenario 
During  downturn,  it  is  very  important  for  the  organization  to 
communicate to the stakeholders and public as well on a regular basis to 
strengthen the relationships and restore their faith . It is observed that 
during  recession,  a  number  of  Indian  organizations  suffer  heavy 
monetary loss and in order  to over this, they started downsizing  their 
manpower. Some of them withhold their fresh recruitment and delayed 
the promotion, incentives and other benefits to their employees. All these 
unfavorable  business  conditions  have  made  the  leading  Indian 
organizations to work out for comprehensive communication approaches 
and  sail  through  the  period  of  downturn  successfully.  The  Indian 
organizations  can  overcome  this  crisis      by  using  both  informal  and 
formal mode of communication.  The Chairman and Managing Director of 
Marico, Harish Marriwala (2009) reiterated that “during tough times, it is 
important to communicate widely and deeply.”  Marico due to its open 
channels  of  communication  is  very  successful  in  sharing  information 
about Marico and its business. This approach paves its path to manage 
rumours and restore stakeholder’s faith.  Samsung’s President and CEO 
(South West Asia) sated that their  aggressive advertisement campaign 
helped them to stay ahead during downturn, D. Shivkumar (2009), Vice 
president and managing Director of Nokia India remarks that there is a Page 8  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
great necessity to communicate openly, honestly and frequently with the 
customers  at  the  time  of  recession.    He  highlighted  that  that  Nokia 
organized a lot of meetings with them through E-mail, SMS and also face 
to  face  communication  to  ensure  their  active  participation.  The  HCL 
Technology’s  organizes  meetings  with  their  employees  to  restore  their 
confidence  and  trust.  Wipro  Ltd  encourages  its  team  members  and 
employees  to  ask  questions  as  to  develop  confidence..    Aditya  Birla 
Group thinks that investors and employees like to be associated with the 
organizations that sustain organizational values and ethics at the critical 
time. 
 
Conclusions 
It  is  high  time  to  develop  effective  communication  approaches  to 
meet the challenges of the global trade. The whole world will need some 
time to get recovered from the clutches of recession. The organizations 
should  show  develop  positive  attitude  to  renovate  and  integrate  their 
existing  communication  approaches.  Face-to-face  communication  and 
networking is of immense   importance to promote the organization. Only 
by  harnessing  innovative  communication  approaches,  the  organizations 
can stay better connect with the internal –external business world in this 
turbulent time of recession.  
 
References 
[1]  Aniko  Czinege  (2010),  “Communication  during  a  Recession  -
Make  It  Personal!”,  www.workwisecommunication.com  (last 
retrieved: Jan 03, 2011). 
[2]  Business  Today  (2009),  “What  I  Learnt  in  the  Downturn” 
January 10 issue. 
[3]  Best  Advice  on  Stress  Risk  Management  in  the  Workplace. Page 9  Oeconomics of Knowledge, Volume 3, Issue 2, 2Q, Spring 2011 
 
Health Canada (2000). www.hc-sc.gc.ca/ewhsemt/ alt_formats/
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[4]  Craig  Hartley-Kite,  Peter  Meyler  &  Tina  Bhati  (2009)  “People 
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Advice on Stress Risk Management in the Workplace. Page 9 Oeconomics of Knowledge,

Communication during a Recession -Make It Personal!”, www.workwisecommunication.com (last retrieved:

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Peter Meyler & Tina Bhati

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