Communication serves five major functions within a group or organization. Communication acts to manage member behavior in several ways. When employees follow their job descriptions or comply with company policies, communication performs a management function. Communication creates feedback by clarifying to employees what they must do, how well they are doing it, and how they can improve their performance.

The work group is a primary source of social interaction for many employees. Communication within the group is a fundamental mechanism by which members show satisfaction and frustration. Like emotional sharing, persuasion can be good or bad depending on if, say, a leader is trying to persuade a work group to believe in the organization’s commitment to corporate social responsibility. The final function of communication is information exchange. Communication provides the information that individuals and groups need to make decisions.

Almost every communication interaction that takes place in a group or organization performs one or more of these functions, and none of the five is more important than the others. Before communication can take place it needs a purpose, a message. The sender encodes the message (converts it to a symbolic form) and passes it through a medium (channel) to the receiver, who decodes it. Formal channels are established by the organization and transmit messages related to the professional activities of members. They traditionally follow the authority chain within the organization.