CMS COLLEGE OF SCIENCE AND COMMERCE

(AUTONOMOUS)
SCHOOL OF COMMERCE B.Com

EXTRA DISCIPLINARY COURSE

STUDY MATERIAL

B.COM

BUSINESS COMMUNICATION

Compiled by
Mrs.D.KIRUTHIKA M.Com.,M.Phil., MBA., M.Com (CA).,PGDCA.,
Assistant Professor,
School of Commerce,
Cms College of science and commerce,
(Autonomous)
Coimbatore 641 049
 SYLLABUS
(Theory: 100%)
GOALS : To enlighten the students with the basic concepts of business
communication.

OBJECTIVES: To develop the oral and written communication skills for successful
application in business.

CONTENTS: (MAX.MARKS:50; CIA:10/ESE:40)

UNIT I
Meaning of Communication meaning, Objective, barriers types Media Barriers
Need and functions of a Business letter Effective Business Letter - Language and
Layout of Business letter
UNIT II
Banking Correspondence Insurance Correspondence Agency Correspondence
Application for appointment Preparation of Resume-Interviews-Group discussions

UNIT III
Meaning of Report Principles governing the preparation of reports Qualities of a good
report Functions of a report Business report Types of Reports Reports by
individuals Reports by committees or sub-committees Directors reports Minutes Vs
Report Drafting of Resolutions and Minutes of Company meetings.

UNIT IV
Modern Electronic Communication devices: Modern Telephones Dictating Machines
Electronic Boards Audio Visual Means Of Communication- Telex- Facsimile (FAX)-
Email Voice Mail Internet- Tele-Conferencing Telephone Answering Machines-
LAN-WAN- Video conferencing.
UNIT-V
Letters to the Editor of Newspapers- Management Information System Introduction-
Need, Definition, Objective, Components, Differing information for different
management levels, areas, stages of MIS design guidelines for effective design, current
trends.

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TEXT BOOKS
1. Essentials of Business communication: Rajendra Pal & Koriahalli J.S,Sultan Chand &
Sons ,2003
2. Effective Business English and correspondence: Pattan Shetty C.S & Ramesh M.S.,R
Chand & CO ,1999
3. Effective Technical Communication M.Ashraf Rizvi ,TataMcGraw Hill ,2010
4. Business Communication Anjanee Sethi ,Bhavani Adhikari,Tta McGraw Hill ,2010
5. Business Communication Kathiresan ,Dr.RAdha ,Prasanna &Co ,2007

REFERENCE BOOKS
1. Business Communication Varinder Bhatia ,Khanna Publishers ,2000
2. Business Communication - K.K.Sinha Galgotia Publishing CO,2002
3. Business Communication P.D.Chaturvedi &Mukesh Chaturvedi,Pearson
Education,2005
4. Business Correspondence & Report Writing R.C.Sharma & Krishna Mohan
TataMcGraw Hill,2002
5. Effective Business Communication Krizan Merrier Logan ,Cengage Learning,2010

3
 UNIT-1

INTRODUCTION TO COMMUNICATION:
Exchange of symbols or ideas between two persons is called as
communication. The term communication is derived from the Latin word communico
which means To Share. Communication means to inform, to tell, to show or to spread
information. Communication is a process through which an information or idea or
opinion is transferred to more number of persons.

DEFINITION:
W.H.Norman and summer Communication is an exchange of facts, ideas,
opinions, or emotions by two or more persons.

OBJECTIVES OF COMMUNICATION
In order to have effective communication, the communication must have the following
objectives:
1. INFORMATION:-
Information is the message which has passed on from one person to another and
understood by both parties in order to make communication effectively. Information is
always factual & objective.
Kinds of information:
a.External information:-
Information concerned with outside world (i.e.) outside the organisation-eg.,
suppliers, creditors, public etc.
b.Internal information:-
Information within the organization (i.e.) information to members of the internal
organization.
Sources of information:-
The following may be considered as the sources of information:
1. Old files 2.observation 3.massmedia 4.library research 5.chambers of commerce
6. Meetings, seminars& coferences7.Personal interview 8.questionnaires 9. Trade
Fairs & exhibitions.

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2. ADVICE:
Advice is also a kind of information given by people in order to bring about a good
change on the receivers. Advice will be successful only if a change is brought in the
receiver. Since it involves personal opinions, it is likely to be subjective.
3. ORDER:-
Order is an authoritative communication. It is directive to somebody & not to-do
something. Usually orders are given to the subordinates of an organization
Types of Orders :
A) Written & oral orders
B) General & specific orders
C) Procedural & Operational orders
D) Compulsory & recommended orders
Instructions: Instruction is a particular type of order in which the guidance is also given
as to do a particular job.
4. SUGGESTION:
One of the important of communication is to give suggestion. It is to give a particular
idea to a person or a group to carry out a particular work.
5. PERSUASION:
Persuasion is the process of convincing a particular person to do particular activities
workers are persuaded to do the production activity quickly.
6. WARNING:
Warning is a forceful means of communication. When the employee does not follow
the rules & regulations, it becomes necessary to warn him.
7. EDUCATION:
Education involves both teaching and learning. Its main aim is to widen the
knowledge & to improve the skills. It is carried over in 3 steps:-
a) at the management level
b) At the level of employees
c) At the level of outside public.
8. RAISING MORALE:-
Morale stands for mental health. Its A powerful factor to increase the efficiency. It
creates a sense of togetherness & makes the workers to work in co-operation.

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9. MOTIVATION:-
Motivation will help the management to get things done. Its not an order.
Motivation is important so that they work willingly & eagerly. The motivation may either
be in cash or in kind.

ELEMENTS OF COMMUNICATION:
Any communication has 4 elements.
1. Sender:
For any communication there should be a sender. Without the sender there cannot be
any communication. Hence there should be a sender or a transmitter to pass on some
information.
2. Message:
The need of communication arises only when an idea or impulse is generated in a
persons mind. If this idea or impulse is to be communicated to someone, their must be
some purpose behind it.
3. Media:
The media is the method or way selected to communicate. A number of mediums such
as telephone, postal etc., are available for communication..
4. Receiver:
The main purpose of any communication is that it should reach receiver effectively.
He is the person who gives the feed back/ answer. Hence for any message there should be
a receiver.
5. Feedback : The response given by the receiver is called feedback which forms again a
part of communication and without which the communication will not be effective.

THE COMMUNICATION CYCLE OR PROCESS OF COMMUNICATION:

1. Generation of idea:
The communication cycle begins when an idea is generated in a persons mind. If this
idea has to be communicated to someone there must be a purpose behind it.
2. Encoding:
The idea is converted into signals. The signal has to be carefully selected. Thus the
process of converting ideas into signals is called as encoding.

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3. Dispatch & reception:
The encoded message is dispatched to its destination. In face to face communication
& oral communication, reception takes place immediately after the dispatch.
4. Decoding:
When the signals have reached their destination, they are translated into ideas once
again this process of interpretation is called as decoding.
5. Receivers response:
If this message is received the receiver immediately responds to it.
6. Feed back:
If this response is communicated back to the sender, it is called as feedback. Feed
back is extremely important for effective communication because without that the sender
cannot be sure whether his message has been understood effectively or not.

CHANNEL OR TYPES OF COMMUNICATION:

1. On the basis of organizational structure
a. Formal communication: Formal communication is an official communication & it
follows prescribed channels through which all members communicate .It is considered as
a standard system of an organisation.
i.Down ward communication: The communication from top management to lower
level management is called downward communication. Eg: Rules, policies, orders etc.
ii.. Upward communication : The communication from lower level management to
upper level management is called upward communication. Eg: suggestions, problems,
requests etc.
iii. Horizontal communication : Communication between departments or people on the
same level is called as horizontal communication. For effective co-ordination among the
departments and to achieve goal of an organization this type of communication is
necessary. Eg: communication between departments for interdepartmental work.

b. Informal communication: It is the communication between persons in an informal

way. It is also called grapevine. It is usually free from formalities and is based on
informal relationship between persons. It can be in the form oral, gesture, glance or
smile etc.

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 Grapevine communication is an informal channel of communication. It follows
no rigid rules, but spreads like gripe vine, in any direction, anywhere rapidly. Its
basically a channel of horizontal communication.
Some people derive great pleasure from gathering secret information &
transmitting it to others. Certain situations like insecurity of service, certain innovations,
etc which are likely to affect the job prospectus of the employees are sure to activate the
leaders of grape vine.
Demerits of grapevine:
1. Distortion
2. Incomplete Information .
3. Damaging quickness

2. On the basis of media

a. Oral communication : It is a face to face communication. There can clarification of
doubts since both the parties are directly involved through face to face contact. It is useful
in handling difficult problems in an organization.
Types are:
1) Face to face communication
2) Mechanical Devices for oral communication such as :
signal in the form of bell, buzzer etc
Speaking tubes
Dictating machines
Telephones
Intercom system
Electric paging system
House telephones etc.
b. Written communication : It contains paper work relating to all kinds of transaction,
agreements and proposals. It is important because it serves as a proof for future reference.
It is also a cheapest method and saves time. People place more reliance in pen than in
tongue.

8
Types are:
Memo : Used to communicate short messages.
Notice: Used to communicate to a large group.
Telegram : Used for external communication for persons in another town.
Telex : Facility to type out messages simultaneously on the senders machine and
the receivers machine.
E Mail (electronic mail) : Message transmitted through electronin computer
network which reaches within a minute.
Reports : Presentation of information related to a meeting, project etc.
c. Non verbal communication : Unwritten and Unspoken communication is called
nonverbal communication such as gestures, smile, actions etc.
Types are:
i.Body movement
Facial expression : expressions in face
Gestures : showing some actions
Body stance : movement of the body also communicates
ii.Physical appearance : To create good impression people sometimes concentrate on their
physical appearance.
iii.Voice quality : Raising ones voice or minimizing ones voice differentiates his or her
communication.
d. Audio visual communication: It uses methods that are seen and heard. It is both
audio and visual eg: films, television, videotapes, slides etc.

BARRIERS / PROBLEMS IN COMMUNICATION

Perception:Every individual is different in perceiving the information. One may
get the point easily but the other may not understand quickly.
Language problem : language sometimes becomes a problem to communicate.
Both the sender and the receiver should know the language.
Attention : there should be proper attention on the part of the receiver, otherwise
the communication fails.
Status : sometimes people neglect to involve in the communication process due to
the status difference between the persons.

9
 Organisational structure : there should be first of all good relation between all
the departments of an organisatoin. Then only the communication will be
effective.
Premature evaluation : sometimes the receiver pre assumes or guesses the
communicator in advance which makes him non attentive.
Emotional attitude : when a person is emotionally effected, then there he or she
will not be in a position to involve in communication effectively.
Failure to communicate on the part of sender : there are possibilities that the
sender himself is not good in communicating .
Other barriers : such as faulty translation, lack of attention, unclarified
information etc.

Importance of Business communication:

Business has grown in size:
Large business house have a number of branches within the country and even in
abroad. The central organization of a large business house is its nerve centre.
For its healthy and even growth it is extremely important that the central organization
maintain a thorough and up-to-date knowledge of a various activities at the branch
office. This calls for an effective an efficient network of communication.
Business activity has become extremely complex:
This being an age of specialization, planning, production, sales, stores, advertising,
financing, accounts, welfare, etc., are handled by different departments. If these
departments do not communicate with one another there will be no communication
among them.
Effective communication promotes a spirit of understanding and
cooperation:
If there exist effective communication between the management and employees, it
helps to bring about an atmosphere of mutual trust and confidence. The management
gets better returns; the employees get job satisfaction. They also develop a sense of
belonging and loyalty to the enterprise.

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PRINCIPLES OF COMMUNICATION

Good perception listening : The communication should be such that the receiver
should have a good perception ie., he should bring the attention of the receiver to
listen the communication. It should attract the concentration of the receiver. The
communication is said to be complete and effective only if it is perceived by the
listener.

Clarity : The communication should be clear which means it should not contain
any unambiguous terms. The words used to be clearly understood by the listener
or receiver. The receiver should not have any doubt regarding the message
transferred.

Simple language : The communication should be that language which is

understood by the receiver. If the language is not understood, then the
communication process as a whole becomes ineffective.

Sound organizational structure : The organizational structure of the company

should be healthy or sound which means there can a good flow of communication
only when there is good relationship between people in the organization.

Coordination among employers and employees : The communication to be

effective needs a cordial relation between the employer and employee, because
there is any misunderstanding between the two, difinitely the communication will
not serve the purpose.

Existance of informal communication channel : In an organization, there

should be the presence of informal or grapevine communication which means
there should be a friendly relationship apart from the formal one which will help
in easy transfer of message and information.

Flexibility of communication system : The system of communication should be

flexible enough so that any person may communicate to anybody within the
organization which will solve many problems and help in taking an appropriate
decision.

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 Two way and open communication : The communication becomes complete
only when there is a feedback from the receiver. The response from the listener
should be received to make the communication effective.

BUSINESS LETTER/ BUSINESS CORRESPONDENCE

The term business letter or correspondence means communication by exchange of

letters, written messages etc. that passes between persons. It refers to written
communication between individuals or groups.

Every businessman has to write letters at every stage of performance. Eg; for
purchase of goods, he has make an enquiry. Similarly when he receives a complaint is
received he should attend it promptly. Thus business letter is the lifeblood of modern
business.

NEED OF BUSINESS LETTER:

Other purposes for which we use business letters are listed as follows:
1. RECORD & REFERENCE:
For maintaining records of communication with the outside world the
communication must be in writing which can be preserved for a long time.
2. MAKING A LASTING IMPRESSION:
Oral communication is not fully remembered, but a written communication makes a
lasting impression in the minds of the reader.
3. AN AUTHORITATIVE PROOF:
A letter signed by a responsible person is an authoritative proof and can be treated as
a valid document which can even be produced in a court of law.
4. BUILDING GOODWILL:
A business letter is used to sell the goods, reputation, and friendliness of a
company. It aims at building goodwill and to retain the customers.
5. WIDENING THE APPROACH:
A business person cannot send his representative to all places of business
connections, but a letter can reach any place immaterial of distance. Hence it widens the
approach of a companys operations.
6. CONVENIENT AND INEXPENSIVE: It is very convenient and less expensive
compared to personal contacts.

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ESSENTIALS OF A GOOD BUSINESS LETTER
1. Correct language : The communication should be that language which is
understood by the receiver. If the language is not understood, then the
communication process as a whole becomes ineffective.

2. Accuracy: The information provided in a business letter should be correct

without any wrong information which will lead to good business dealing.
3. Pertinence : The matter in the letter should be pertinent or related to the
business transaction only. It should contain unnecessary information.
4. Conciseness : It should be brief enough and not too lengthy. It should be short
and attract the receiver.
5. Clearness : The letter should be clear enough so that the receiver does not get
any doubt. The terms and conditions of the letter should be clear without any
vague terms.
6. Courteous : It should be with the intention of business and should use good
salutation. It should also be with an intention of maintaining good relationship.
7. Completeness : The letter should be complete in all respect. The information
should be complete in giving all the details. There should not be any unwanted
or lack of information.
8. Cheerfulness : A business letter should attract the receiver to have and
maintain a cordial relationship.
9. Objectivity : The objectivity or aim of the company should be always kept in
mind before drafting a letter.
10. Consideration of reader : The reader should taken into mind in writing a
business letter ie., his language, position, relation, etc.

VARIOUS TYPES OF BUSINESS LETTER

1. Enquiries and replies : Trade enquiries are made to find out details of the
products for placing orders. Replies are given by the dealers or sellers by giving
details of their products and prices.
2. Orders and their execution: Orders means placing an order to the seller for
purchasing the products. Execution means the reply letter given by the seller
whether he is ready to execute the order or not.

13
3. Credit and status enquiries: For the purpose of finding out whether credit
facility can be given to a customer or not, credit and status enquiries and done.
4. Claims and adjustments : Claims means complaint letters from the customers.
Adjustments means a letter making an adjustment of the product by the seller to
the customer.
5. Collection letters : The seller who gives the products on credit basis gives and
intimation of the amount due from the customer through a collection letter.
6. Circular letter : This letter is used to give information to the general public about
the vaious matter eg: Launching of a product, change of the place of company,
admission of a new partner, etc. In this the information has to provided to a large
number of people.
7. Sales letters: It is a letter containing the details of the products and prices for sale
to attract the customers which contains information such as discount offer, gift
vouchers, etc.
8. Banking correspondence : The communication between company and its
bankers for matters related to deposits, withdrawals, overdraft, etc. is called
banking correspondence.
9. Insurance Correspondence : The communication between a company and
Insurance company for matters related to policy, payment of premium etc is
called Insurance correspondence.
10. Import-Export correspondence : The communication between companies of
different countries for import and export purposes with details of the product,
price, import duties etc., is called Impor Export correspondence.
11. Agency correspondence : The communication between the principal and the
agent for business purposes is called Agency correspondence.
12. Application letter : The letters containing application for any post in an
organization by an individual is called Application letter.
13. Interview letters, references, testimonials, letter of appointment, confirmation,
promotion, retrenchment, resignation..
14. The correspondence of a company secretary : The includes communication
between a company secretary with the directors, shareholders, customers,
government etc.

14
 15. Correspondence with state and central government : This includes
communication by a company with the state and central government regarding the
matter of price policy, taxation etc.
16. Letters to the press : This includes letters to the editors of newspaper for
publication of matters related to business.
17. Transport correspondence : This includes letters to transport corporation
regarding the charges and modes of payment for the same.
18. Public relation letters : It includes letters to customers for maintaing a good
relationship with the public.

STRUCTURE OF A BUSINESS LETTER

a. Heading
b. Date
c. Inside Address
d. Salutations
e. Reference
f. Body
g. Complementary close
h. Signature
i. Reference initials
j. Enclosures

ESSENTIALS OF AN EFFECTIVE BUSUNESS LETTER:

A business letter is an important form of written communication. Here, is a short
checklist for your quick guidance.
1. PROMPTNESS:
As a rule respond to the letter the day it is received. If you need time, acknowledge the
letter and indicate as to how soon you will be sending a separate reply.
2. KNOWLEDGE OF THE SUBJECT:
This includes the knowledge of the past correspondence, if any, the requirements of
the sender of the letter and the knowledge of the firms policies.

15
1. APPROPRIATENESS :
This means the contents of a business letter should be appropriate, which means the
matter in the letter should be related to the subject. It should not contain any
unnecessary information.
2. ACCURACY, COMPLETENESS AND CLARITY : The information in the
letter should be correct with full details, complete without any missing
information, and should be clear in the sense that the reader or receiver of the
letter does not get any doubt in the letter. The receiver should be able to
understand properly the message communicated to him.
3. COURTESY: The letter should be with business intention. There should not be
any bias in the information and proper salutation should be made to the receiver
eg: using respected sir, kindly etc.
4. TACT: A business letter should be such that it attracts the receiver easily.
Therefor sender should communicate in such a way that the receiver gets interest
in reading the message.
5. PERSUASION : The business letter should be such that it persuades or motivates
the reader to have dealing with the sender and continue to have business with the
sender.
6. CONCISENESS: The letter should be brief, it should have only the apt
information and should not be too lengthy.
7. SALESMANSHIP : It should be written with an intention of doing business and
with an aim to develop the business by increasing sales.
8. THE YOU ATTITUDE : The business letter should consist the WE attitude
instead of YOU attitude. Which means it should lead to good understanding and
relationship between the sender and the receiver.
9. THE POSITIVE AND PLEASANT APPROACH: The approach should be
positive in the sense that the intention should not have a negative approach. This
means that any business letter should have the aim of extending a good relation
with the outside world whether with a customer, other company, or government
etc. It should also contain proper and pleasant and good words.

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THE LANGUAGE OF A BUSINES LETTER
The language of a business letter should be familiar:
Many people think that a special language called business English whish is supposed
to be somewhat different from everyday spoken English is to be used business letters.
This is a totally false notion. There are certain businesses terms like F.O.B., C.O.D, 15
days 2%, which cannot be avoided. But these terms familiar through constant use and
pose no problems. Apart from these technical terms, as far as diction and syntax are
concerned, business English is no different from the English of daily use.

PHYSICAL ASPECTS FOR APPEARANCE OF A BUSINESS LETTER

Business letter should be capable of attracting the attention of the reader. The purpose
of the letter is to bring business and so the physical appearance of the letter should enable
the reader to form an opinion about the firm and its reputation.
The business man should note the following points in his mind while writing a letter:
1. Paper:
Quality of the paper Best quality
Color of the paper Normally white or light shades
Size of the paper A4
2. Typing:
If the matter is too long single space may be used.
If the matter is short - double space should be given.
3. Margins:
Margin should be left on all sides of the letter paper.
Subject matter should be typed in the centre of the letterhead.
4. Folding
Letter should have only minimum number of folds
5. Envelope
The Envelop used should correspond to the size of the paper.
The color and quality of the envelop should also be in agreement
with the letter head.

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LAYOUT STYLE OF FULLY BLOCKED LETTER STYLE:

PRASANNA PUBLISHERS
EDUCATIONAL PUBLISEHRS

Phone: 854 23 52 17, murugappa achari street,

Email:prasanna@eth.net chelpauk,Chennai-600005.

18th January 2010

Prof.S.Kishore
Jain College
Chennai.

Dear professor Kishore,

We are very glad to inform you that we are sending a copy of our recent publication Business
Correspondence for your reference and recommendation.
The book is written in simple language and suits the new syllabus of the Madras University. The
book runs nearly 375 pages. The price of each volume is Rs.80/-
A specimen copy of the book is sent to you by a separate parcel.
Please favor us with your valuable orders.

Yours sincerely
For Prassana Publications

M.Subramaniam
Proprietor.

18
 UNIT- II

BANKING CORRESPONDENCE

FUNCTIONS OF A MODERN BANKER:

1. To receive and accepts loan and advances.
2. To discount bill of exchange
3. To provide safe deposit vault facilities for their customers.
4. To pursue references regarding the financial standing of others.
5. To issue letter of credit , bank drafts, travelers cheque etc.,
6. To act as agents to buy shares and stocks for the customers.

ELEMENTS OF GOOD BANKING CORRESPONDENCE:

1. Secrecy:
Secrecy in money matters is the first thing that a client expects from his banker.
Expect in cases of enquiry from fellow bankers, a client account and its details are
treated as absolutely secret and are never revealed to any other person.

2. Style:
Good style in bank letters is brevity and conciseness because the customers are
businessman and they have no time to waste on super flowers reading.
The banker should not be too impersonal or formal in his letters.

3. Tact and Courtesy :

Tact and curtsey are of paramount importance in banking letters. It is very easy to
level allegations against a customers and there by to loose his account. Curtsey is
particularly very important while writing about overdrawn accounts and while asking for
additional security. Similarly when a request for overdraft is to be refused, the language
should be diplomatic so that the customer takes no offense.

4. Clarity:
Clarity in bank letters must be considered as a basic necessity. The matter should be
clear and precise and there should be no ambiguity. However, clearness should
never be sacrificed for the sake of brevity. All unnecessary details should be
avoided, must be backed by actual facts.
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TYPES OF BANKING CORRESPONDENCE:
Form letters:
Bankers usually use a number of form letters with the set text of the matter. They have
a fixed phraseology meant to be used on different occasion in the course of business
operation of the bank. They are printed with some blanks left, to be filled in by the
customers or by the bank officials at the time of transacting any deal. They are used only
wjhen The intimation or communication is of a routine nature and when no special or
persuasive emphasis is necessary.
Individual letters:
This refers to each letter which is individually writer in each case depending on the
subject concerned and sent to others. Individual letters can be again classified into 3
kinds namely:

Types of Banking correspondence :

1. Letters between the bankers and their clients
2. Letters from one bank to another
3. Letters between the head and the branch office
1. Letters between the bankers and their clients:
These comprise of:
a) Letters from the banker to the customer:
The most important and crucial part of bankers correspondence consists in
communication with the customers. They include answering enquiries by customers,
complying with standing instructions of the customers, handling complaints of the
customers regarding a dishonor of their cheques, wrong statement of accounts debits of
bank charges etc.
b) Letters from customers to the bankers:
These mainly consists of request for opening accounts, enquiry about the interest rates,
status enquiry, application of loans and overdrafts, standing instructions regarding
making payments etc.,

20
2. Letter from one bank to another:
These relate to status enquiry, negotiation of bills of exchange, clearance of bills etc.,
Here technical terms normally used in the banking business can be freely used but should
not be used in letters to the customers.
3. Letter between the head and the branch office:
These consist of
a) Letters from head office to branch office:
These include letters from the head office to the branch, which deals with matters of
administration, and convey the decisions and policies of the head office to its network of
branches. The head office should serve as a model for the branches to follow both as
regards to its mode of administration and its methods of correspondence. Therefore, the
letters from the head office to the branch should serve as a model in those qualities such
as accuracy, clearness, courtesy etc.
b) Letters from the branch office to the head office:
Letters from branch office to the head office, generally consist of
Various monthly, quarterly, half yearly or annual reports submitted by
the branch manager.
Reports from branch managers giving suggestions for further
development of business in the branch.
Letters recommending appointment of staff, promotion and transfer.
Letters containing the date of advances granted to the customer.
Letters which explain some unconventional decisions.
In short a branch manager is a trusted subordinate writing to his superiors. His letters
must be courteous, polite and full of definite facts.

INSURANCE CORRESPONDENCE
Meaning of Insurance:
Insurance is a contract between two parties (Insurer and Insured) The contract is
embodied in a document known as policy,. The insurer indemnifies the insured for a
consideration in the form of money called the premium. The contingency insured against
is called the risks.

21
Basic principles of Insurance:
1. Utmost good faith- Ubberimae fidei:
Insurance is a contract based on almost good faith. I t implies that the parties should
exchange information accurately on all aspects relating to the risks to be covered.
Failure discloses any material facts shall render the contract null and void.
2. Indemnity :
Indemnity means security against damage or loss. In the contract the insurer
undertakes to indemnify or compensate the insured for losses accruing due the risk
covered. The assurance of the event is also contingent.
3. Insurable Interest::
The insured must have an insurable interest in the subject matter of the insurance.
With out such interest the contract is null and void
Types of insurance:
1. Life insurance
2. Fire insurance
3. Marine insurance
1. LIFE INSURANCE:
Kinds of life policies:
1. Endowment policy
2. Wholetime life policy
3. Joint life policy
Life insurance correspondence:
Exchanging of letters occurs frequently between the policy holder and LIC. The LIC
has standardized most of its correspondence because most of them are of similar nature.
However, the letters from the policy holders may vary.
2. FIRE INSURANCE:
Kinds of fire policies:
1. Specific policy
2. Average policy
3. Floating policy
4. Valued policy

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LETTERS IN FIRE INSURANCE
The correspondence in respect of fire insurance usually consists of the following g letters
relating to:
1. a request for the insurance of the proposal submitted
2. letter from the insurance company enclosing a covering note
3. notice intimating changes in the address and reply
4. notice of damage by fire
5. settlement of the claim
6. letters admitting or refusing the claim
3. MARINE INSURANCE
Kinds of marine policies
1. voyage policy
2. time policy
3. mixed policy
4. floating policy
5. valued policy
6. unvalued policy
7. open policy
LETTERS IN MARINE INSURANCE
1. sending proposal for effecting insurance
2. Inquiring about the rate of premium
3. advising the declaration of shipment of goods
4. notifying claims in the event of loss
5. acceptance of the risk
6. insurance of the certificate of declaration

AGENCY CORRESPONDENCE

Meaning of agency correspondence

An agent is one who is appointed to act for another. The person who appoints the agent
is known as the principal. The agreement between them is known as the agency
agreement

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Kinds of Agents:
1. Commission Agents
2. Declared Agents
3. Factors
4. Brokers
5. Auctioneers
6. Clearing and forwarding agents
7. Underwriters
8. Warehouse Keepers

APPLICATION LETTER
Whenever you submit your resume accompany it with a cover, or application, letter to
let readers know what youre sending why youre sending it, and how they can benefit
from reading it. Because your application letter is in your own style (rather than the
choppy, shorthand style of your resume) give a change to show your communication
skills and some personality.
Send you resume and application letter together, because each has a unique
job to perform. The purpose of your resume is to get employers interested enough to
contact you for an interview.
The purpose of your application letter is to get employers interested enough
to read your resume. Learn something about the organization youre applying to; then
focus on your audience; Imagine yourself in the recruiters situation, and Show how your
background and talents will solve a particular problem or fill a specific need the company
has. During your research, find out the name, title of the person to contact. So respect
your readers time, include nothing in your cover letter that already appears in your
resume.
Keep your letter straightforward, fact-based, short, upbeat, and professional.
(drafting cover letter) Be Specific and Avoid general objectives. Be as clear as possible
about the kind of opportunity and industry youre looking for.
Make-email cover even shorter. When sending a cover letter by e-mail, make it a bit
shorter than traditional application letters. Remember, e-mail readers want the gist very
quickly.

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 UNIT-III
REPORT

Report is defined as a communication from someone who has some information

to someone who wants to use that information.

BUSINESS REPORT

A business report is an orderly presentation of facts about specific business

activity or programme.

OBJECTIVES OF REPORTS / IMPORTANCE OF REPORTS

1. To help the management in Decision making : A report always serves as a good

guide for taking decision by the management. It proves as a helping agent in giving
the information about what happened in the past and helps in predicting the future.
2. To have future reference : It serves as a proof of record for future reference. If
anything happens in future, it can be shown as a proof.
3. To provide information to various parties : Many people like creditors,
shareholders, directors, government, customers etc., are interested in knowing the
facts related to companies. The report provides the necessary information to them.
4. To have effective control : The report is useful to have control over various business
activities and performance of the business so that future development can be made.
5. To make an optimum use of the funds: It helps in proper management of finance of
the concern since it gives the information about the past utilization of funds.
6. To increase the efficiency of the business : It helps in the working ability
enhancement of a business giving information to the right person at the right time.
7. Diversification and expansion : A report serves as an effective tool to diversify their
production or expansion or to enter into collaboration etc. Thus, reports play a very
significant role in the management of modern business.

TYPES OF REPORTS

1. Oral and written reports.

2. Informative and interpretative reports.

1. Oral and written reports:

a.Oral report: An oral report is simple and easy to present. It may consist in the
communication of an impression or an observation. It is very simple to give a report
orally. It does not consist any specific procedure to be followed. An oral report can be
denied at any time. But a written report is a permanent record. An oral report tends to be
vague and may contain irrelevant facts.

b.Written report : A written report is the best method of report which is most applicable
to every organization. It serves as a good record for future reference. It is a best proof. A
written report can change hands without any danger or distortion during transmission.
A written report can be referred to again and again.

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2. Informative and interpretative reports:

a. Informative report : If a report merely presents facts pertinent to an issue or a

situation, it is an informative. For example Informative report on the sale of folding
beds will simply record the number of beds sold during the year.
b. Interpretative reports : If a report presents not only the facts pertinent to an issue
or a situation, but also the explanation for such situation, it is an interpretative report.
For example Interpretative report on the sale of folding beds will record not only the
number of beds sold during the year, but also the reason for the increase or decrease
in sales of those beds.

QUALITIES OF A GOOD REPORT

A report is a statement or form, which presents facts relating to an event, progress of

action, State of business affairs in a comprehensive and systematic manner. The
essentials of a good report are:

(a) The report should be addressed to definite person or body of persons and it should be
started with a salutation "Dear Sir" or "Dear Sirs".

(b) The report should be accompanied with a brief title,

(c) The report should contain a table, which states page number in which a particular
point is available.

(d) The object of the report must be clear in the opening paragraph.

(e) The facts available in the report should be complete and reliable. (/) Repetition of
writing should be avoided.

(f) The report should be free from clumsy and it should be submitted at its proper time.

TYPES OF BUSINESS REPORT:

A. On the basis of legal formalities to be complied with:

1. Formal reports : Formal reports are the reports prepared formally to be submitted to
the management for decision making purposes. Eg., report submitted by lower level
management to the top level management.
Formal reports are of various types such as :
a. Statutory report : Reports which are required by law to be prepared by the company
such as Reports of committees of directors , Reports of special or adhoc committees ,
Directors report to the share holders of a company, Report by individual
officers/executive heads and officers of a company, Financial reports, Reports of the
company secretary , reports on meetings etc.

b. Non statutory report : These are reports which are not required by law to be
prepared. It is left to the decision of the management to prepare such report or not.

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 2. Informal reports : These reports are the reports prepared in an informal way. Eg.,
report submitted by an employer to supervisor about the day work done by the employee.

B. On the basis of persons entrusted with the preparation of report:

a) Reports by individuals : When a single person is given the work of preparing a
report, it is called report by individuals.
b) Reports by committees or sub committees : When a group of persons are
given the work of preparing the report then it is called committee report.

C. On the basis of nature of reports:

a. Periodic or routine reports : These reports are prepared periodically or often at
continuous intervals of time.
b. Progress reports : These are prepared to show the level of progress of the
company in various aspects such as sales, profit, growth etc.
c. Examination reports : These are reports which are prepared to show what
happened in a certain process eg., examining the workers at their work place.
d. Recommendation report : This contains not only the information about what
happened but also includes recommendations and suggestions to the top
management to take measures.
e. Statistical reports : This is a report which converts the raw data into statistical
analysis and presents in the information in an easily understandable way.

AGENDA
The term AGENDA means the things to be done of business to be transacted at
the meeting. Agenda paper is the program of items to be discussed at the meeting in
the order in which they will be taken. Each item needs a headline and a number.
The following is included in the formal agendas,
1. Apologies for absence
2. Minutes of previous meetings
3. Matters arising
4. Correspondence(optional)
5. Date of next meeting
6. Any other business
An agenda sometimes combined with the notice of meeting which is both
economical and ensures that people do have the opportunity to consider the business
prior to the meeting.
There are generally two ways in which the agenda for a meeting can be prepared:
1. By referring to the business very briefly by writing just one line about each item
for example:
a. to read the minutes
b. to pass transfers
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 c. to produce financial statement
2. By giving more details about each item and even sometimes including suggested
drafts of the resolution for consideration of the meeting.
The second method is found more suitable as it helps the secretary to write the
minutes easily.

MINUTES
Minutes mean a draft, memorandum, brief summary of proceeding of a assembly, a
committee etc. they are an official record of the happenings of any other gathering of any
persons. The minutes should provide a clear and concise indication of the actual
happenings at the meeting i.e., decision regarding policy, action to be taken, agreements
and resolutions placed. In a single word minutes can be described as as official record of
the proceeding of the meeting. It should be concise and accurate

CONTENTS OF THE MINUTES

1. Name of the group which held in the meeting.
2. Date, place and time
3. Name of the chairman and members present,
4. Names, destination and organization of people in the attendance those who were
present or invited.
5. Name of the members who sent apologies (sorry)
6. for their absence.
7. The minutes.

TYPES OF MINUTES
There are two types of minutes
1. Minutes of resolution
2. Minutes of Narration.

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 UNIT IV
MODERN ELECTRONIC COMMUNICATION DEVICES

MODERN TELEPHONE
Telephone serves as the backbone of a company. The right telephone system is capable of
reinforcing the business in its goal to achieve good customer service. Toll free number
for instance project professional image. It is also cost effective tool to advertise or
promote the products and services offered by a company. Since the number is free to
call,it can create high response rat. In return generate additional sales.
Advantages :
It saves time.
Immediate feedback
More effective
Disadvantages :
Information not fully reliable
No face to face contact
Wrong person being communicated.
Costly for distance communication
It is not a record of communication.

DICTATING MACHINE
A dictation machine is a sound recording device most commonly used to record
speech for later playback or to be typed into print. It includes digital voice recorders
and tape recorders.
Advantages:
Helps in saving time because message is being dictated to a machine and not a
person.
Helps in grammatical accuracy
Serves as a good record
There is no interruption in between

AUDIO VISUAL COMMUNICATION

When attempting to relay a message or idea, it's usually easier and more effective
to do so face-to-face than on paper or via email. That's because written or audio
communication alone has certain limitations that could muddle your message or result in
misunderstanding. Audiovisual communication breaks down the traditional barriers of
written communication to ensure that your audience understands the message easily,

29
resulting in better discussion and collaboration in business, education and personal
applications. Eg: of audio visual communications are Television, pictures, films,
slideshows etc.

Advantages of Audio Visual Communication:

Clarity
One of the main benefits of audiovisual media for communication is clarity. When
you send an email or write a letter, you know the type of tone and mood used in the
letter, but it could come across differently to the receiver. Audiovisual input enables
both parties to observe facial expressions and gesture, hear tones and inflections in
the voice and use both audio and visual cues to clarify each other's meanings and
positions.

Speed
Just 100 years ago, communication through written or word-of-mouth correspondence
often took weeks and months. In comparison, today's communication is immediate,
with the use of audiovisual media such as video phones, web cams and face-to-face
meetings.

Retention
Audio and visual cues, when combined, increase message retention. According to the
United States Department of Labor, a mere 10 percent of information is retained
when presented only orally and only 35 percent of information is retained when
presented only visually. But when audio and visual tools are combined to present a
message or idea, 65 percent of that information is retained. Presentation software and
video conferencing can be effective tools in meetings and lectures because your
audience receives and processes the information more effectively than it would with
more traditional approaches.

Media
By adding videos, visual aids and sound clips to your presentation, you create a
multimedia experience. This helps your communication become more engaging to the
audience using a variety of media, from mp3s to video footage to still-image
slideshows and online social media.

TELEX
In the old days (50's to 70's), before email, and even before faxes... were Telex
Machines. A telex is a teletypewriter. They are 2 consoles (or more, in a network), sitting
at opposite ends of a phone line. What is typed on one machine is automatically relayed,
and typed by the machine on the other one. The machines can be in the same building, or
at opposite ends of the globe.

The message as typed in the originating office is typed on a small strip of paper at the
receivers end. This is one of the quickest and most accurate methods of transmitting
written communication.

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Advantages:

Message is transmitted by direct dialing

Much quicker than a letter and cheaper than the trunk call service.
If a receiver of the information is not present at that time he can view the message
neatly typed on the teleprinter when he returns.
It can be used for overseas purpose by getting help of Central Telegraph Office.
Useful for large business houses at any time of day and night.

FACSIMILE (FAX)
The fax machine is very useful for transmitting visual material such as diagrams,
illustrations, photographs or copies of artwork visuals. It is a fax machine with a
connected telephone. As the document to be transmitted is fed through the machine, it is
electronically scanned and signals are transmitted to the receiving end, where an identical
copy of the document is reproduced on a blank sheet of paper by the receiving machine.

What are the difference between telex and fax?

Both telex and fax are very quick means of transmitting information. But in a
telex what is typed at one end is received and typed at the other end. So it does
take time it needs to type the document. In fax, the finally prepared document is
inserted in the machine and almost instantaneously copy of the document comes
out at the receiving end.

Charts, graphs, other visuals cannot be sent through telex. But they can be easily
sent through fax. Faxing a document is like transmission of a photocopy of the
document.

Moreover, telex sends a typed text (same as in a telegraph) whereas fax sends a
copy of a text. Therefore telex is more accurate than fax.

Telex uses a dedicated telegraphic network.

Fax uses a phone network. Therefore telex is more reliable in countries where the
phone network is unreliable (ex: some remote areas in Africa, Central Asia etc...)

EMAIL

E-mail (popular name for electronic mail) involves sending messages via
telecommunication links. If two computer terminals, however distant from each other,
are connected on network, it is possible to send messages from one to the other. The
message is typed on a computer screen at one end, and is conveyed to the other end
through electric impulses. The person operating the computer terminal at the
receiving end is alerted by a signal that a message, or mail, meant for him is in the
electronic mailbox. Or he can occasionally see his mailbox to check for any incoming
mail.

To be able to use E-mail all that one needs is an access to a network area, a PC, a
telephone, a modem with its software and the basic knowledge of using software,
which is easy to acquire. One does not have to be a computer expert to be able to use
E-mail nor does need a separate telephone line for it. Modems are not every
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 expensive either. It has also been discovered that sending messages by E-mail is quite
cost-effecient.

Advantages of E-mail

It is the quickest means of transmitting messages.

You can check your mailbox and receive your messages at your leisure.

Email saves you fro telephone tags. As long as people keep checking their
mail boxes regularly, the communication cycle continues to work efficiently.

Email messages can be sent to a large number of people simultaneously. If

both the persons are simultaneously sitting at the terminals, clarifications can
be sought.

Email messages are supposed to be highly confidentially and secure.

Email messages can be easily stored for future reference.

VOICE MAIL

Voice mail, strictly speaking, is a form of email only. Here, a message, instead of
being communicated in a written form, is sent in the voice of the caller. Like Email it
is very easy to use and is a convenient way of leaving short messages for someone
who is not immediately available.

INTERNET

The internet may be defined as a global collection of people computers linked

together by telephone lines, radio links or satellite links. It has been introduced in
India quite recently but being extremely versatile and fast its popularity is increased
day by day.

Advantages of Internet
We can send email across the world.
There exist groups of people with common internets. They can all be the buyers of a
companys product or chess lovers. Such interest groups are referred to as mailing
lists. We can subscribe to any of such lists, which means that we can receive copies of
all the mail sent to the list and we can also send mail to all the subscribers of all the
mail sent to the list and we can also send mail to all the subscribers of the list. Thus
Internet can be easily used for publicity and advertisement.
We can use if for tele-conferencing.
We can have an electronic copy of journals and magazine for the Internet.
We can be in touch with people around the world.
We can provide technical support to the customers.
We can do electronic commerce on the Internet.

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TELECONFERENCING

Teleconferencing (or videoconferencing) allows people to meet and work

collaboratively without having to be together in one room. They could be separated
by an office way or by thousands of kilometers. that is immaterial. They can hear
and see each other, and share information with one another as if they were all placed
together in one room. Teleconferencing can lead to substantial saving both in terms of
money and executive time. In this era of globalization when multinationals are
simultaneously operating in several countries separated from one another by
thousands of kilometers, teleconferencing can prove to be a very effective means of
mutual consultation.

TELEPHONE & MACHINE

Sometimes telephone messages arrive when there is no one personally present to
attend to them. In such a case, a telephone answering machine can prove to be very
useful. Whenever the telephone bell rings, the machine reproduces a pre-recorded
message. Most of the railway and airline enquiry offices transmit pre-recorded
messages in response to inquiries made to them. Such messages are usually of routine
nature.

LAN (Local Area Network)

A computer network that spans a relatively small area. Most LANs are confined to a
single building or group of buildings. LANs are capable of transmitting data at very fast
rates, much faster than data can be transmitted over a telephone line; but the distances are
limited, and there is also a limit on the number of computers that can be attached to a
single LAN.

WAN ( Wide Area Network)

LAN can be connected to other LANs over any distance via telephone lines and
radio waves. A system of LANs connected in this way is called a wide-area network
(WAN).

VIDEO CONFERENCING

A videoconference is a live connection between people in separate locations for

the purpose of communication, usually involving audio and often text as well as video. At
its simplest, videoconferencing provides transmission of static images and text between
two locations. At its most sophisticated, it provides transmission of full-motion video
images and high-quality audio between multiple locations.

33
 UNIT V

MANAGEMENT INFORMATION SYSTEM

Management
Management for purpose MIS consist of the activities carried out by
manager. The planning, organizing and controlling, staffing, analyzing, co-
ordination, directing, motivating, decision making all are major activities of the
business.
Information
Information consist classifying, analyzing, recording to the perfect
management process. The information classified buy customer and location
cumulative sale distribution amount customers and used by management for
purpose of information.

System
A system is a set off two or more elements such a people thinking and
concepts and aim and achievement goals in common objecting of system. A
system set off many

Meaning of MIS
Management information systems are the study of information system
focusing on their use in business and management. Davis and Olson in 1985 have
mentioned that the study of MIS arose in the 1970s to focus on computer based
information systems aimed at managers.

34
 Information

Management System

Definition of MIS

A Management information system is used to transform data into useful

information as needed to support managerial decision making with structured
decisions (formally called programmed decisions) which are those that are based
on predictable patterns of activity. The typical MIS is based on four major
components (McLeod, 1986)
(I) Data gathering:
Data pertinent to the operations of the organization are gathered from both
external and internal sources.
(ii) Data entry:
The above data is inputted and stored in databases as the information
processing core of the system.
(iii) Data transformation:
Data is transformed into useful information through the application of
computer software programs and judgments made by technical support staff and
other system users.

35
(iv) Information utilization:
This useful information is retrieved as needed by the management and
technical personnel and applied to a wide variety of decisions related to the
conduct of organizational operations
Organization system

Public system
Public system and private system

Formal Informed
structured unstructured
systems systems

Formal Informal

FEATURES OF MIS
Jerome kanter in his work titled management information systems mentions several
Features of MIS. Some of them are:

MIS is management oriented:

The designing of MIS takes care of the managers, who meet the
information n requirement. The development of the system starts after deciding
the management needs and keeping in view the overall objectives of the
management.
Management directed:
Since MIS requires heavy planning and investment, management is deeply
involved in the design, implementation and maintenance of the system.

36
 Integrated system:
FIVE MS-Men, Money, Materials, Machines and Methods are the
basic resources of management information and is recognized as an important
factor and its effective use contributes to the success of the management. IS the
catalyst and nerve centre of an organization it becomes necessary that they
have to be viewed as an integrated system, so that the result is balanced? It binds
together databases of all subsystems of the business system and through
information interchange, integrates the organization.
Avoids redundancy in data storage:
Since MIS is an integrated system, it avoids unnecessary duplication and
redundancy in data gathering and storage
Common data flow:
Common data flow tries to utilize minimum data processing effort and
strives to minimize the number of output documents and reports. This type of
integration can avoid duplication, simplify operations and produce an effective
MIS. But separate files should be opened which are significant to one application
with the use of common data flow.
Heavy planning element:
Design and implementation of MIS require detailed and meticulous
planning of such activities as acquisition and deployment of hardware, software,
human ware, data processing operations, information presentation and feedback

Subsystem concept:
MIS gives provision for breaking into various subsystems based on the
activity as well as the functions of the organization, so that effective
implementation of each subsystem is possible at a time.
Common database:
It acts as a master that holds the functional subsystems together. It
achieves this aim by allowing access to different master files of data to several
functional subsystems. Data requirements fir different levels of management also
support the need of more than one database, unique databases and common
database.

37
 Flexibility:
MIS has been designed flexible enough to accommodate new
requirements. The system is easy to operate so that not much computer skills are
required on the part of the user to access database for information or for carrying
out special analysis of data.
Computerization:
MIS can be computerized because of its nature as a comprehensive
system. This provides speed in creating and accessing files, accuracy, consistency
in data processing, reduction in clerical work, avoid human errors etc.

REQUISITES OF AN EFFECTIVE MIS

1. Database
SUPERFILE
Subdivided into the major information sub-sets
Improves accessibility and reduces redundancy
Its important characteristics of
Each sub system utilizes same data i.e. common data source
Reduces duplication of efforts
User-oriented
Available of authorized person only
Controlled by separate authority know as Database management system (DBMS)
2. Qualified system and management staff
Two categories of staff (I) system and computer experts
(ii) Management experts
Difficult to attract and retain suitable experts
3. Support to top management
Support essential because of:
(i) otherwise sub-ordinate managers become lethargic
(ii) Resources involved is large
4. Control and maintenance of MIS
Control implies system operation works as per design
Maintenance implies identifying areas of improvements

38
5. Evaluation of MIS
Capable of meeting the information requirements in future as well. It requires
MIS evaluation appropriate timely action. Evaluation should consider
Whether enough flexibility exists
Users and designers views
Appropriate action steps

MIS Model
Modules of management information system are:
Data collection module
Data storage module
Data processing module
Information reporting module
Decision support module
Control support module
Modeling and simulation module
Data collection module:
The data collection module aims at collecting and capturing the input data from
the data sources. The data collected through this module is used by other modules of MIS
to provide the required outputs. The size and structure of this module largely depends on
the nature and type of data, the transaction volumes and method of data collection.
Data storage module:
The data storage module aims at proper storage of the data collected by the data
collection module in order to make it available for data processing activity which is
governed by the data processing module. The data storage activities often involve
magnetic storage of data on computers.
Data processing module:
The data processing module aims at converting data into information. The design
and structure of the data processing module would depend on several factors such as
information requirements, transaction volumes, complexity of computations, processing
speed requirements and so on.

39
The information reporting module:
The information reporting module uses the output of the data processing module.
Using these inputs, the information reporting module generates actionable information.
The stress of this module is to present the information in a form that is convenient for the
end users of information.
Decision support module:
The decision support module of MIS aims at providing the information that
facilitates the decision making activity.
The scope of the decision support module is restricted to providing the
information support for the decision making activity. The decision making is considered
to be outside the scope of the decision making activity. The decision making is often
considered as a human activity which is external to the decision support module.
Control support module:
Control support module aims at providing information support for the control
activities in business organization. The activities of planning set a goal against which the
actual performance is compared through the control function. This activity is often
expressed in terms of feedback control mechanism.

40