Business networking

Networking is a socioeconomic business activity by which groups of like-minded businesspeople recognize, create, or act upon business opportunities.

In the second half of the twentieth century, U.S. advocates for workplace equity popularized the term and concept of networking as part of a larger social-capital lexicon—which also includes terms such as "glass ceiling", "role model", "mentoring", and "gatekeeper"—serving to identify and address the problems barring non-dominant groups from professional success. Mainstream business literature subsequently adopted the terms and concepts, promoting them as pathways to success for all career climbers. Since the closing decades of the twentieth century, networking has become an accepted term and concept in American society. People now invoke "networking" in relation to everything from child-rearing to science to the business activities described here.

Overview

A business network is a type of business social network whose reason for existing is business networking activity (or connecting with other business people in order to further each other's business interests - forming mutually beneficial business relationships). There are several prominent business networking organizations that create models of business networking activity that, when followed, allow the business person to build new business relationships and generate business opportunities at the same time. A professional network service is an implementation of information technology in support of business networking.

Many business people contend business networking is a more cost-effective method of generating new business than advertising or public relations efforts. This is because business networking is a low-cost activity that involves more personal commitment than company money. Country-specific examples of informal networking are guanxi in China, blat in Russia, good ol' boy network in America, and old boy network in the UK.

In the case of a formal business network, its members may agree to meet weekly or monthly with the purpose of exchanging business leads and referrals with fellow members. To complement this business activity, members often meet outside this circle, on their own time, and build their own one-to-one business relationship with the fellow member.

Business networking can be conducted in a local business community, or on a larger scale via the Internet. Business networking websites have grown over recent years due to the Internet's ability to connect business people from all over the world. Internet businesses often set up business leads for sale to bigger corporations and businesses looking for data sources for business.

Business networking can have a meaning also in the ICT domain, i.e. the provision of operating support to businesses and organizations, and related value chains and value networks.

General business networking

Before online business networking, there existed face-to-face networking for business. This was achieved through a number of techniques such as trade show marketing and loyalty programs. Though these techniques have been proven to still be an effective source of income, many companies now focus more on online marketing due to the ability to track every detail of a campaign and justify the spend involved in setting up one of these campaigns.

"Schmoozing" or "rubbing elbows" are expressions used among professional business professionals for introducing and meeting one another in a business context, and establishing business rapport.

Networked business

Many business use networking as a key factor in their marketing plan. It helps to develop a strong feeling of trust between those involved and play a big part in raising the profile and takings of a company. suppliers and businesses can be seen as networked businesses, and will tend to source the business and their suppliers through their existing relationships and those of the companies they work closely with. Networked businesses tend to be open, random, and supportive, whereas those relying on hierarchical, traditional managed approaches are closed, selective, and controlling. These phrases were first used by Thomas Power, businessman and chairman of Ecademy, an online business network, in 2009.

See also

• Professional network service
• Personal network