Networking

Sausage rolls to software Networking is the new buzzword for business these days, according to Simon Elliott of Virtual Business Networks (VBN). "Everyone's doing it," he says, "and if you're not, then you may as well shut up shop now and retire". In the past six years business networking has really taken off in Britain. There are now around 4,000 business networks operating in the UK - that's one per 15,000 of the population and the numbers are growing fast. Of course there's is nothing new about networking for business, after all, the Freemasons have been doing it since the early 1700s, so why is the nation going networking crazy now?

Traditionally, says Elliott, business networks have formed around geographical clusters that have a high rate of company formation, such as Cambridge, which has a good balance of self-grown businesses as well as longer established enterprises and a world leading academic offering. In particular, smaller businesses with more specialist services find business networks particularly fruitful. Advances in IT have also meant that even small firms can enjoy greater economies of scale that were beyond their reach before and this also promotes a need for networking.

In recent years there has been a growing sophistication in the way business networks operate. Networks, like any small business, now have to compete with each other for members and demonstrate clear value in the services they offer. It's no longer good enough just to get a bunch of people together in a room once a month for a glass of cheap Bulgarian red and a sausage roll. Members demand more. The internet makes business networks more accessible and interactive than ever before. With the take up of internet usage in business, many networks took the first step of setting up a website. Initially these websites were very basic - merely brochure sites with little real value. However, in order to compete and grow, networks have evolved their websites to become a core part of the service offered to members.

Take for example, Cambridge Network, which lies at the centre of the technology cluster and present surge of entrepreneurial activity within Cambridge. The network was set up to raise the profile of the Cambridge business community in order to attract inward investment, nurture technology and get local businesses to work more effectively. The network currently has 1,300 corporate members and is growing by 20 per cent a year. Peter Hewkin, CEO of the Cambridge Network, sums up what makes networking so important and why the web has made such a difference. "Business networks provide an ecosystem in which small companies can flourish", he says. "The DTI has latched on to how clustering can help small organisations and the ever increasing contribution that small firms make to the economy. Networking helps smaller companies to fill in the gaps, making it easier for them to compete with or sell to larger organisations". Hewkin says the network website embodies the brand of the Cambridge phenomenon, "but it's become much more than a marketing tool over the years. The functionality of the site has grown enormously and this has allowed us to grow our membership very quickly. Members can book themselves onto events, search for jobs, release news, enjoy café networking or join a special interest group. Working with VBN has enabled us to access the technology that allows us to totally integrate the face to face networking with the web services so that both elements complement each other".

So what does the future hold for business networks if we can do most things online? Well, its good news for introverts. No more do you have to stand in the corner nervously clutching a plastic cup trying to pluck up the courage to talk to a group who are all laughing a bit too hard at other people's jokes when you can search for appropriate companies to contact on a network's website and send them an email instead. "But let's not jump the gun here," says Elliott. "I don't anticipate that the internet can provide all the answers and it will never replace the basic human element of face to face networking - after all there's no such thing as a virtual sausage roll".