Problems and Challenges of Communication in the Service Sector

Communication plays a vital role in the success of a service company, and the service sector is no exception.

However, various problems may arise during communication in the different channels used by service companies. These problems may arise due to the inconsistency between the information transmitted through the primary and secondary communication channels.

To analyze the problems and challenges of communication in the service sector, it is essential to consider each communication channel and how inconsistent information affects service communication’s success.

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External communication in a service company takes place between the management and the service customer. There are two forms of communication exist between these two parties;

  • one-sided and
  • two-sided communication.

One-sided communication involves only one of the communication partners, while two-sided communication requires the active participation of both parties.

Service companies that cannot implement a two-sided communication strategy face problems identifying the needs and wants of the service customer properly.

One-sided communication makes it inefficient to choose suitable media and the way of communication for each service customer. Since services often show credence qualities, the customer usually requires more information about services than commodity goods.

Communication with the service customer plays a vital role in establishing long-term customer relationships through customer loyalty programs.

Internal communication in a service company

Internal communication in a service company involves communication between the management and employees. Integrating service customers into the production of services requires interaction between the service employee and customer.

Successful internal communication is the prerequisite for successful communication with the customer.

However, one of the common problems in the internal communication of a service company is implementing a sender-oriented strategy that does not take the receivers’ understanding and requirements into account.

This strategy not only decreases the motivation and commitment of the service employee but also causes poor communication of the service customers’ needs, wants, complaints, etc., to the management of the service company.

The service employee plays the role of a medium of information between the service customer and the service company in the secondary communication channel. There are three types of communication by taking the intensity of this interaction as the basis: service delivery communication, proactive communication, and customer-initiated communication.

Problems and Challenges of Communication in the Service Sector

Problems in communication between the service employee and the customer may occur when the service employee is not capable of fulfilling the requirements for each different form of communication and transmitting information consistent with the information transmitted through corporate communication channels.

In addition to corporate communication, employees use informal horizontal information channels by interacting with other employees.

These informal internal communication channels may cause some problems in the general communication system of a service company, even if they are a vital part of the internal communication.

While corporate communication is built on guidelines developed by the management, informal communication between employees is not realized according to specific guidelines.

Problems in the communication that take place between employees may occur due to subjective interpretation of the information by the employees, different rent-seeking aims of employees, and lack of formal information in the company.

Informal internal communication may create insider deals, which may be contradictory to the company’s overall goals and may benefit a certain group in the company.

Word-of-mouth is aimed at forming publicity, which may be an effective supplement to sales by generating referrals and incremental patronage.

Negative word-of-mouth, which can be damaging for the service company, is the basic source of problems concerning the communication channel between the service customers and the service company’s perspective.

As word-of-mouth can be more reliable for the potential customer than the corporate communication for a purchase decision because of the nature of services, negative word-of-mouth may damage the credibility of the service company.

The modern media makes the sharing of information much easier and quicker.

Therefore the service customers can interact with the other service customer on different platforms and share their experiences. This globalisation and modernisation of the communication system increase the importance of word-of-mouth in the decision process for the purchase.


Tofunmi is a BA, MBA, and experienced Researcher in Business Administration and Management. He possesses outstanding communication, leadership, conflict resolution, organization, and teamwork skills. He enjoys teaching and reading books on startups, business, personal finance, investment, and more.

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