Big Business NetWorking, Part 2: The Missing Link

Last month we discussed the big business/small business NetWorking gap. This month we look at some ways in which NetWorking changes as organizations grow larger.

The Missing Link

Any organization of one or more people is a NetWork. Any NetWork is an organization of one or more people. Corporations (large and small) are organizations (again…providing there is more than one person involved…we’ll talk more about this in a moment). Therefore, corporations are NetWorks. Period. Every NetWork has a purpose: to provide products or services. How effectively they do so is determined by how the total NetWork is managed, maintained, and served. Under "Kovitz’s Law," any organization’s total NetWork includes its internal and external NetWorks.

N_TOTAL = N_INTERNAL + N_EXTERNAL

Let’s take a closer look at these…

External NetWorking

External NetWorks are comprised of individuals that exist outside an organization, yet are still aligned with it in some way. This is what most businesses, large or small, think of when they think of NetWorking, and includes joining other NetWorks, going to NetWorking events, asking for referrals from clients or trusted advisors, outsourcing, strategic alliances, joint ventures and virtual organizations.

Using the formula above, there is no internal component in a sole proprietorship (one person does not a NetWork make!), and so the total NetWork depends entirely on the size of the external NetWork.

Internal NetWorking

Internal networks involve the people within the organization and therefore, depend upon the number of employees. The more employees, the larger the internal NetWork. And while larger corporations tend to frown upon the term "network", other than in describing its computer systems, terms that will typically be used are "horizontal integration", "social acumen" or "social capital". More often than not, larger corporations map out their internal NetWork in the form of an organizational chart. The fact is, though, that everything big business does involves a NetWork.

• Executives set the direction the organization’s internal and external NetWorks will take
• Management oversees the day-to-day health of the internal and external NetWorks
• The marketing, sales, PR, shipping, purchasing, and customer service departments deal almost exclusively with the external NetWork
• Accounting deals with the cash flow between the internal and external NetWorks
• The legal department advises and enforces compliance between the internal and external NetWorks in areas such as vendor contracts, employee contracts, and government regulations
• The IT department makes sure the computer network serves the internal NetWork properly; it also makes it easy for the external NetWork to conduct legitimate business but hard for it to conduct mischief
• The human resources department helps develop and provide benefits for the internal NetWork; benefits which are typically provided by external NetWorks

The Implications

So what does all of this mean? Here is only a partial list:

• All roads lead to NetWorking. Many corporate terms like leadership, management, team building, communications, sales, planning, process improvement, customer service, time management and quality revolve around the total NetWork of any organization and determine its effectiveness.
• The way big business grows its internal NetWork is through investment in training, development, mentoring, coaching and process improvement. It’s interesting to note how many former consultants, coaches, speakers and trainers have started their own successful NetWorking organizations based upon what they’ve learned in big business. Moreover, they will be the first to tell you that communication issues are the number-one cause of organizational disarray, ineffectiveness, and negative impact on the bottom line.
• The more an organization develops its internal NetWork through employee development, the more potential exists for a more robust external NetWork.
• Overdeveloping an internal or external NetWork without regard to the other will lead to failure or breakdown of organizational effectiveness in the form of drop-offs in sales, lower employee morale, ineffective management, spikes in customer complaints, stretched, vendor shortages, resource shortages and higher learning curves, to name just a few.
• Communicating is NetWorking. NetWorking is communicating. Success depends upon how NetWorks are managed.

Next month we’ll wrap up our series on big business NetWorking by reporting on a new trend in what progressive organizations are doing to manage their NetWorks.

Happy NetWorking!

Please contact Adam at Adam@TheNationalNetworker.com.