Back to the Future

Networking is the kind of social and professional interaction that came naturally to businesspeople throughout most of this nation’s history, especially in smaller communities. But as villages grew into towns, towns into cities and cities into megalopolises, the sense of community and the close, personal business relationships that went with it gradually disappeared. The rise of large retail chains and multinational corporations, along with the demise of small businesses under the stiff price competition from these giants, further weakened the natural networking that existed.

The disappearance of community-based networking has left a vacuum that is now being filled by strong-contact networks. Business networking organizations such as BNI create a virtual main street for business professionals–an environment and a system for passing referrals that is the 21st-century equivalent of the traditional model for doing business.

As Eric Lesser, in his book Knowledge and Social Capital, notes, “Without a shared understanding of common terms, activities and outcomes, it becomes very difficult to reap the benefits associated with building social capital.” The power of business networking organizations is that they provide these common terms, activities and outcomes in a system that is designed specifically to accomplish this goal.

When you join and attend meetings in a business networking group, you build social capital in a number of ways. You gain the trust and friendship of fellow members; you provide valuable referrals; you contribute knowledge and skills to the effort; you become more knowledgeable and improve your social and business skills. Not least, you get out of your cave–the self-imposed isolation that many business people fall prey to.

Like financial capital, social capital is not only earned and accumulated, it can be spent. The international networking organization BNI has Givers Gain as its guiding principle: The good you do comes back to you over the long term and often in indirect ways. You accumulate social capital by providing help, advice, information, referrals and other benefits to your fellow networkers, with no thought of a quid pro quo. By gaining the trust of others, gratitude for value provided and a solid reputation for integrity and expertise, you become a person whom others wish to help whenever an opportunity to do so presents itself.

A colleague of mine worked for several years with a financial advisor who was a very passionate networker. In fact, he founded a chapter of an international networking organization and became very active as the president of the chapter. He gave more referrals than anyone else in the chapter; however, he got very few referrals back in return.

He came to my colleague a little frustrated about this. My colleague told him it takes time to build trust, especially in the financial services industry. He recommended several books on the subject and suggested that the advisor attend some training programs my colleague was offering. The financial advisor’s reply was a complete surprise. He said, “Train me to train the programs.”

My colleague said, “Aren’t you concerned that you’re already giving a lot more that you’re getting?”

He said, “Yes, but I know that trust takes time, and giving people valuable training at my expense will build trust.”

He became my colleague’s lead trainer and assistant director in Winston-Salem, N. C., and continued to give even more of his time and energy than he ever had before–even though he had been very active in his previous leadership role. His network rewarded him in an amazing way. Over the next 24 months, he received referrals worth $36 million–proving once more that givers always gain in the end.

The More You Give, The More You Get

You’ve heard of financial capital, but do you know about social capital?

Financial capital is the material wealth, whether money or property, that is accumulated by individuals and businesses and used, or available for use, in the production of more wealth. This is the standard definition in economics.

Social capital is the accumulation of resources developed in the course of social interactions, especially through personal and professional networks. These resources include ideas, knowledge, information, opportunities, contacts and, of course, referrals. They also include trust, confidence, friendship, good deeds and goodwill.

Like financial capital, social capital is accumulated by individuals and businesses, and is used in the production of wealth. Unlike financial capital, social capital is intangible; but it’s every bit as real as financial capital. Although it is difficult or impossible to measure precisely, it can be even more powerful than financial capital in terms of eventual return on investment.

Social capital is built by design, not by chance. According to Wayne Baker, author of Achieving Success Through Social Capital:

Studies show that lucky people increase their chances of being in the right place at the right time by building a “spider web structure” of relationships that catch information  . . .  Success is social: All the ingredients of success that we customarily think of as individual–talent, intelligence, education, effort and luck–are intertwined with networks.

Thus, a key way that social capital is acquired is through the process of networking. Successful networking is all about building and maintaining solid professional relationships. The trouble is that we don’t live as they did on Little House on the Prairie anymore, so we no longer have these natural community-like business relationships. Many people hardly know their own neighbors, let alone the businesspeople who run the shops and stores down at the local strip mall. Yet, more than ever, networking is critical for an individual’s success in business.

Networking at Holiday Parties

The holiday party is a great time to meet people but . . . you should have a plan!

Everybody goes to parties, and the holiday season is full of them. It’s also a business slowdown season for many of us who are not in retail. The holiday parties are NOT just a place for free food and drinks.

Holiday parties and other social mixers bring new opportunities to network, even more than the rest of the year.   The holidays are times when we are more likely to see people in a social setting, and this setting definitely lends itself to building relationships.

Most people think of networking only in traditional networking venues, such as the chamber, strong-contact referral groups like BNI, and other business-oriented gatherings. But that’s not using the power of networking to its fullest.

It can be the best time to introduce yourself or have a friendly conversation with one of your superiors. Making an impact on someone important can be a real career booster; it could open the door for new job opportunities, promotions and/or new business.

In order to make the most of “holiday party networking,” here are a few things to keep in mind:

  • Be prepared! If you’re going to hobnob, try to know whom you are talking to, what their job and role in the company are and what they’ve done this year for the organization.  Use this info as a way to start a conversation. If you know some of the people who will be in attendance, do a Google search on them.  Do some homework.
  • Ask questions. Some suggestions: How did you start the business? How did you take the business international?  How did you start franchising? What were some of the challenges with . . . ? Have you read any good books lately? (My favorite is: How can I help you?)
  • Have a “teaser” topic ready. Approaching the end of the year, every business wants to increase profits and performance in the New Year. Have an idea ready that describes how you can improve your sector in the coming year. (Word to the wise: Don’t give away the goose; set up a meeting to discuss the details.)
  • Use this introduction as a segue for a future meeting. As mentioned above, you don’t want to “end” the conversation at the party. The end game here is to open the door for follow-up. You want to be able to connect with the person after the party, one-to-one.
  • Don’t have more than a couple drinks. It’s a party, but it’s not YOUR party. You don’t want to be stinking of liquor when you approach the people you want to connect with. Impressions count. Make the right one.
  • Be confident of your value. Introducing yourself to an executive can be an intimidating experience, so give yourself an informed pep talk. Before the event, make a list of the things you’ve done over the past year and understand how what you do may integrate into discussions. Once you’ve got this down, there’s no reason you shouldn’t feel good about yourself. Consider how what you’ve done can integrate with the executive’s interests.
  • Honor the event. Make sure when networking at a holiday party–or any non-traditional networking event–that networking is supplementary to the reason people are there, so don’t treat it like a chamber mixer.  Be sincere.

Don’t act as if you’re in the boardroom giving a presentation; keep it natural and leave them intrigued. The real emphasis must be on “finesse” at a company holiday party. Yes, it is a great networking opportunity–but if you overtly “sell,” you may turn people off! After all, it is a holiday.

You can network anywhere, including events where it might not at first occur to you to try it–and, paradoxically, it’s at these non-traditional networking settings where you’ll often get the most bang for your buck.

International Networking Week 2010 Video

I am pleased to announce that the new video for International Networking Week, 2010, is now available on YouTube.  The video was sponsored by Entrepreneur Press and the Referral Institute.  Mark your calendar now.  International Networking Week is the week of Feb. 1 through 5, 2010.  For additional information go to www.InternationalNetworkingWeek.com.

This is the fourth year for International Networking Week.  It is now recognized by many countries around the world, with thousands of events being held during the week.  Take a look at the video and let me know what you’ll be doing to recognize this week.

Virgin Galactic’s SpaceShipTwo

I had the privilege of attending the rollout of Virgin Galactic’s SpaceShipTwo yesterday.  The spaceship rides under the center portion of the mother ship, called the WhiteKnightTwo (which I wrote about last year).

The rollout had many special guests, including California Gov. Arnold Schwarzenegger (pictured at podium–last photo at bottom), Sir Richard Branson (pictured in second to last photo) and Burt Rutan (the designer of the spacecraft, pictured with me, here) .

The plane will carry the spaceship and its six passengers and pilots up to an altitude of roughly 50,000 feet before releasing it prior to the spacecraft’s rocket motor kicking in and taking it the rest of the way into suborbital flight (about 60 miles above Earth).  From there, passengers will be able to experience weightlessness as well as see the curvature of the Earth.

During Rutan’s presentation, he said that when he was working on the X Prize project to show that private commercial flights into outer space were possible, he spoke to several airlines to see if they would like to joint venture on the concept. None of them was interested.

He then shared with the audience that just prior to the launch of the WhiteKnightOne for the X Prize competition, he received a phone call from Sir Richard of Virgin Atlantic, who asked if Rutan were interested in working with him to help launch the Virgin Galactic spaceships as a commercial venture.  Rutan thought that Virgin was a great company to partner with because it has a history of flying passengers with a founder who is willing to tackle large projects that involve a high risk but can include a big payoff.  He said Branson has been the perfect partner throughout the process, giving him guidance and a substantial amount of freedom.

Entrepreneurship is alive and well in the U.S. and the world! I was impressed by the designers and engineers I met.  The whole experience was concrete evidence that an entrepreneurial spirit can take the groundwork laid down by governments for space exploration and turn it into a viable commercial venture.  Branson said he hopes that by the year 2020, space flight will be affordable to many people around the world.  I, for one, would not bet against him.

I predict that before 2020, Virgin Galactic will have created more astronauts than all countries combined have done to this date.

Your Mother May Have Taught You More About Networking Than You Thought

My friend Charlie Robertson from the UK recently wrote a really great blog about some important lessons his mother taught him growing up and how he uses these lessons on an everyday basis when networking.

Check out Charlie’s blog below.  I have a hunch your mother may have taught you these same things.  If not, though,  let’s at least hope you have the bath part down by now . . . that one’s definitely key. 😉

Charles, do your homework!

My mummy always told me to . . .

1. Make friends
2. Play nice
3. Tell the truth
4. Take a bath
5. Do your homework

What has this got to do with networking?

1. Make Friends
Will you introduce your best clients to someone you don’t know just because you met them at an event?
Relationship building is absolutely necessary, as is having structured one-to-ones. Dr. Ivan Misner talks a lot about V+C=P. The need to have visibility, then building credibility, resulting in profitability.

2. Play Nice
Do you practice Givers Gain, or do you have a hunting sales mentality?
Do you listen more than you talk and refrain from interrupting others when they are talking? Do you treat people with respectful elegance face-to-face and online. Do you give genuine testimonials when they are earned? And very important: Do you thank people properly for their assistance?

3. Tell The Truth
Honesty is absolutely necessary in business; behaving and acting in an ethical manner enhances your reputation. If you mess up, be honest. “I’m sorry, I really dropped the ball on this occasion; please give me the opportunity to put this right.” It is possible to create a good second impression when you get things wrong.

4. Take a bath
Not as big an issue online ;-).   However; In face-to-face meetings, body odor is not the new cologne! Shower, wash your hair, look presentable, dress according to your profession.

5. Do your homework
Get prepared for your meetings in advance, not last thing the night before or writing your elevator speech while others are speaking. Be specific: Set goals on what you want to achieve, then measure and analyze. If you arrange a one-to-one, find out as much as possible about the other person’s business in advance so you are showing you are interested in [that person] and not self-centred.

What lessons did your Mum give you that have stood you in good stead?

Charlie Robertson
Thank you to Jason Smith for inspiring this blog.

Business Networking Predictions for 2010

2009 is almost over (and many are glad about that!), and it’s time to look ahead. I have before me my crystal ball.  I am looking into the future, and this is what I see for 2010:

  1. First, the economy IS going to improve.  OK, this isn’t a”networking” issue, but it IS important.  Have faith.  Look for opportunities.  Focus on what you do best.  You will have a better year next year, but you need to focus on solutions and get out of the quagmire of problems.
  2. Online social networks will continue to grow in prominence.  OK, I didn’t need the crystal ball for that one.  However, consider this . . . digital schmoozing may continue to grow, but so will the frustration over how to convert that technology into viable business opportunities.  This is an emerging field, and much of it will be established over the next few years.
  3. Companies, small and large, need to create a social media strategy.   What’s your plan?  Oh . . . you don’t have one? Big mistake in 2010.  You need to start working on one now.  Don’t know where to start?  Do a little research.  There are some really good experts out there who can help you in this area.  I’ve been working with Social Media Expert Mirna Bard this year, and she has really helped my organization create a strong, cutting-edge social media strategy that we are now pursuing globally
  4. Victims of downsizing will become active in networking groups (both face-to-face and online).  Many people have been laid off.  My experience in running BNI, the world’s largest networking organization, is that within a few months of an increase in unemployment rates, there is almost always an influx of new members into networking organizations.  I am confident that there will be such an influx in 2010.
  5. We will begin to see more of an integration between face-to-face and online networking opportunities.  Online networks will do things to promote face-to-face opportunities, and face-to-face networks will begin to integrate online networking more effectively into their programs.
  6. We will see the slow death of the “one-way” website.  More and more, companies will create websites that operate in two directions.  They will not only provide information to their customers but will also seek feedback from their customers.  Blogs, interactive newsletters, social network sites, consumer feedback groups . . . all of these will continue to grow in importance for companies.
  7. Face-to-face networks will continue to grow, IF they stay true to a fundamental mission of helping people grow their businesses.  Nothing beats networking in person (see my blog on this subject from earlier this year).
  8. Companies that succeed in 2010 will remain agile and will focus on relationships. Technology is a tool.  Relationships are king when it comes to networking.  Companies who are creative in using tools to enhance the relationship building process will be the leaders in a company networking program.

Well, there it is.  Those are my predictions for 2010.  What do you think of these ideas AND what, if anything, would you add to these business networking predictions?

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