Types of Business Communication based on Formality:
Communication can be classified on the basis of the formality into two types: formal communication and informal communication.
(1) Formal communication: When communication occurs by following the prescribed rules and procedures of the organization, it is called formal communication. Formal communication is governed by the established chain of command. It is the process of exchanging information by following the prescribed or official rules, procedures, systems formalities, chain of command etc. in the organizational structure.
(ii) Informal communication: When communication does not follow any prescribed rule or procedure, it is called informal communication. The basis of informal communication is spontaneous relationship among the participants. Informal communication is sometimes more powerful and more effective than formal communication. It is the process of spontaneous exchange of information among various people of different status in the organizational structure.