A Strategic and Practical Guide to Networking

Introduction

In starting and growing a business it’s not just about what you know, it’s also who you know. Building and tapping into an effective network is essential in growing a successful business. The article will also highlight that a well-connected network of key people is also essential to growing a strong regional economy.

This article aims to provide practical insights and tips into how to build and utilise networks to advance your business and your own career.

1. WHAT IS NETWORKING?

According to Susan Ward, who runs an IT business in Canada, “Business networking is the process of establishing a mutually beneficial relationship with other business people and potential clients and/or customers.”1 

Many people are frightened by the mere mention of the term ‘networking’; this should not be the case. It can and should be a very natural activity, part of every day life and business and - with a little coaching - almost anyone can develop a productive and supportive network.

The key to true business networking is the establishment of a mutually beneficial relationship, building a good collection of people who can help each other with ideas, support and business referrals and revenue.

A strong network helps to get things done, you do not need to know everything or everyone you just need a solid network of people that you trust who have knowledge, experience and contacts that can be mutually beneficial.

Another useful definition is from Lauren Neilson:

"Effective business networking is the bringing together of like minded individuals who, through relationship building, become walking, talking advertisements for one another."

Doing business in a networked world

In today’s economy, most people work in small or mid-sized businesses rather than large corporations. Although the big companies may have many thousands of people on the payroll, even they do not claim to have all the talent in the world under their one roof. They need to connect with customers, suppliers, partners, marketing agencies, investors etc.

Entrepreneurs and small companies – often with a handful of key staff - know for sure that all the talent is not under one roof! Futurist Frank Feather2  describes a future business universe with 100 mega corporations, 1 Million niche companies and 1 Billion webpreneurial businesses. In this context, we all need to connect and network.

To be truly effective in today’s interconnected business world, we need to quickly acknowledge and act upon the obvious:

 … there is a big wide world out there with lots of talented people – who are not on your payroll - who have great ideas, skills and experience. Get to know them and work with them!

There are a lot of talented people out there who are good to know and can help you and you can help them. This is what networking is about.

Why bother with networking, what can it help you do?

The bottom line is that ambitious entrepreneurs need to be well connected and networked to be effective in today’s business environment and to leverage talent, ideas and resources to get things done.

Networks can help to:

• Build a supportive peer group, people who may be in the same situation as you that you can trust and bounce ideas off

• A base of talent with a range of skills and experience in key areas of interest to you

• Get things done more quickly – learning from the experience of others, by asking for referrals of key people, potential customers or credible service providers

• Career development – may be a source of a new job or opportunity if your new venture goes wrong or it is time for you to move on

• Build a reputation - developing strong ‘word of mouth’ or buzz about you and your business, word of mouth is frequently cited as a leading sources of new business enquiries for start-ups and service firms

Research into the growth of major technology clusters around the world – notably Cambridge in England, Silicon Valley, Boston etc – has highlighted the critical role of ‘social networks’ in growing clusters of entrepreneurial businesses.3

Strong social networks develop by key players in a region – including serial entrepreneurs, service providers, angel and venture capital investors, university staff etc - getting to know and trust each other and then working and collaborating together. All these key players in the network can tap into the collective talent, wisdom, experience, resources and wider networks of its members.

In any region, the opportunity is there to develop a productive network that not only benefits its members but also boosts the wider economy. How many people does it take? Paul Graham in his outstanding essay on ‘How to be Silicon Valley’  says its all about people, and if you moved 10,000 people out of Silicon Valley to say Buffalo then that could be the next Silicon Valley.4

He then adds an interesting footnote:

“It's interesting to consider how low this number could be made. I suspect five hundred would be enough, even if they could bring no assets with them. Probably just thirty, if I could pick them, would be enough to turn Buffalo into a significant startup hub.”

I agree, 30 good people could change almost any region into an entrepreneurial hotspot. If a network can do that for a region, what could it do for you and your business?

Building your network

You are not starting from scratch. Whether you know it or not, you already have a network and so does everyone else. Your network includes past and former work colleagues, family, friends, business associates etc.
It is also vital to realise that networks already exist. The key then is to identify the networks that are useful to you and begin to tap into them and become a valuable and contributing part of them.

Every network has a few key people who are really ‘human hubs’ - this may be down to their role or personality or some other factor – and they know everyone in an industry sector or location and are well respected in that network.

You need to identify and build a relationship with these key people they can open the door to many other useful connections.

Another useful and practical idea is to take 20 minutes to sketch out a network map. Think about your own role, business, profession, interests, goals etc, then map out key areas it where it would be good to know people, for example in my role at the Innovation Centre Sunshine Coast, key parts of my network map include:
-     IT industry
-     Clean technology industry
-     Creative professionals
-     Key referral sources e.g. lawyers, accountants, product designer, patent attorneys
-     Professional associations e.g. Australian Institute of Company Directors which has over 300 members in the local region
-     Leading lights in local business community
-     Leading lights in Brisbane tech business community and professionals service firms
-     Key staff – at all levels – at the University of the Sunshine Coast
-     Local, State & Federal government
-     Angel and venture capital investors
-     Local community groups
-     Etc

Once you have figured out the key parts of your network to build up, next steps include:

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