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Networking Principles for Entrepreneurs

This document discusses the importance of networking for starting and growing a business. It defines networking as building a broad social network that can provide resources like funding, equipment, advice and emotional support. It recommends using the "5-Links-to-the-President Principle" to widen your network through intermediaries. Super-connectors who know many people are important to identify. Maintaining relationships is key and involves trust, reliability and considering others' interests. The document provides tips for actively expanding one's network and templates for tracking contacts.

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38 views5 pages

Networking Principles for Entrepreneurs

This document discusses the importance of networking for starting and growing a business. It defines networking as building a broad social network that can provide resources like funding, equipment, advice and emotional support. It recommends using the "5-Links-to-the-President Principle" to widen your network through intermediaries. Super-connectors who know many people are important to identify. Maintaining relationships is key and involves trust, reliability and considering others' interests. The document provides tips for actively expanding one's network and templates for tracking contacts.

Uploaded by

ladss.propogo
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

1

MODULE 4

SESSION 2:
NETWORKING

Elmer A. Lorenzana, MM Module in The Entrepreneurial Mind


August 2020 Bicol University College of Business, Economics, and Management – Entrepreneurship Department
2

What Is This Session About?

This session will provide you the importance of networking in organizing and starting your
business. When you start a business, you need social network that will assist you for any difficulties that
you may encounter in your start-up activities and even as you progress with your business.

You also need to get correct information for your business decision. This can be easily acquired if
you have wider social network in your local areas. Now that we have advanced technology that enhances
social network with people, we connect with people, we get information, we try to screen the accurate
information, we use them for any decision making in starting our business and improving our business.

What Will You Learn?

In this module, you are expected to explain the benefits of networking using the Five-Link-to-the-
President Principle to widen your network, describe how to maintain relationship with your social network,
and how to enlarge your social network.

What Do You Already Know?


Most people in the Philippines are familiar with
Facebook. You have revived your connections with
your old friend and met new friend through
Facebook. It seems that for most people, Facebook
has become part of their daily lives.

Let’s Reflect
• How many friends do you have on Facebook?
• How many of them are your real friends that can
assist you in your business endeavor?
• What do you think is the use of Facebook in establishing business network?

Let’s Study (Input):

Elmer A. Lorenzana, MM Module in The Entrepreneurial Mind


August 2020 Bicol University College of Business, Economics, and Management – Entrepreneurship Department
3

A big social network can help you to access the following resources: financial capital / cash; other
resources such as equipment, facilities, etc.; information, advice, and ideas; reputation (prominent strategic
alliance partners) and; encouragement / (emotional) support when facing problems.

Think of people that you know and that might be helpful for your venture! Ties with other business
persons such as top managers at buyer firms (distributors), at supplier firms, at competitor firms;
membership in trade organizations, chamber of commerce, Small Business Development Centers, industry
associations; group activities of start-up colleagues / entrepreneurs, formal and informal gatherings of
entrepreneurs, contact to business communities & owners, business networks; customers research institutes;
financial institutions, banks; law firms, lawyers; business consultants, external accountants; political leaders
in various levels of the government; officials in regulatory agencies and supporting organizations such as
tax bureaus, state banks, commercial administration bureaus; and family members, relatives, and friends.

The 5-Links-to-the-President Principle

We know almost everybody through intermediaries. This can be explained via the 5 links to the
president. This could be explained by the following example: You to 1) your father to 2) the colleague of
your father to 3) his wife to 4) the sister of the bodyguard of the president to 5) the president. However,
you have no idea who’s who (what kind of contacts) with what (types of resources). But if you spread the
news, people with interesting networks can come to you! Let as many people as possible know that you
are starting a business. The news will spread.

How to get in contact with all these people? The 5-Links-to-the-President Principle: Who knows
the president? Who knows a person who knows the president personally? Who knows other very important
persons (VIPs), celebrities, influential people? Who knows a person personally? Who knows VIPs or the
like?

Taking a short-cut to the president is through super-connectors. Super-connectors are people with
relationships to many other people. Getting in touch with super-connectors means getting in touch with a
variety of people. Identify super-connectors & get in touch with them.

How to Maintain Relationships?

Elmer A. Lorenzana, MM Module in The Entrepreneurial Mind


August 2020 Bicol University College of Business, Economics, and Management – Entrepreneurship Department
4

This is by building a trustworthy relationship. Tell both sides of the story (the best, worst, most
likely). Reliability and credibility: Fulfill your obligations and deliver on your promises and commitments.
Listen to others’ concerns and take them seriously. Show that you have other people’s interests in mind.
Predictability and consistency: No actions that negatively surprise. Mutually acceptable and integer actions:
Do unto others as you would have others do unto you (friendliness, discretion, and honesty).

Actively and Persistently Enlarging the Social Network

What contacts might be helpful for you right now? Who else might be helpful? What non-obvious
people might be helpful? Who will you contact? How, when and where can you approach them? What else
can you do to approach them / what will you do if your first plan fails?

What contacts might be helpful for you in the future? Who else might be helpful? What non-obvious
people might be helpful? Who will you contact? How, when and where can you approach them? What else
can you do to approach them? What will you do if your first plan fails?

Networking: The Principles of Action

You need to build a broad social network. Remember that you will need people – if not now,
certainly in the future. Let as many people as possible know that you are starting a business. Tell the people
about your idea and the industry you are in.

You must maintain your social network. Keep records of your contacts. Establish trustworthy
relationships through showing reliability, credibility, respecting and considering the other’s interests, and
integrity.

Let’s Think About This

Given all those concepts of networking as a helpful tool in starting and expanding your business
operation, answer the following questions:
1. What is the 5-Links-to-the-President?
2. Why is it important to identify and link with super connectors?
3. Why do you need to expand your social network?

Elmer A. Lorenzana, MM Module in The Entrepreneurial Mind


August 2020 Bicol University College of Business, Economics, and Management – Entrepreneurship Department
5

Let’s Try This

Keeping records to maintain and reactivate relationships: Make notes of whom you meet with
important information (e.g., name, position, contact details, access to). Get business cards. Note down
intermediaries or paths how you can re-contact with a certain person.

Name Position Contact Details Has access to Can be accessed


(& institution) (mobile, e-mail) (resources, via (person)
persons)

Elmer A. Lorenzana, MM Module in The Entrepreneurial Mind


August 2020 Bicol University College of Business, Economics, and Management – Entrepreneurship Department

Common questions

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Reliability and credibility are crucial as they build trust within the network. Fulfilling promises and maintaining consistent communication demonstrates competence and integrity, establishing an entrepreneur's reputation as a dependable partner. This trust encourages network members to collaborate and share opportunities, which can lead to more business, partnerships, or resources .

Networking provides resources essential for overcoming start-up challenges, such as financial capital, equipment, advice, and emotional support. A broad network connects entrepreneurs with other business leaders, industry associations, and support organizations, enabling access to expertise and resources necessary for addressing difficulties that arise during business development and growth .

Providing a balanced view (“telling both sides of the story”) fosters transparency and trust within network relationships. By sharing the positives, negatives, and likely scenarios, an entrepreneur demonstrates honesty and builds a reputation for integrity. This level of openness encourages reciprocal trust and cooperation from network contacts, strengthening the overall relationships .

The 5-Links-to-the-President Principle illustrates that almost everyone can be reached through intermediaries, highlighting the role of connections in networking. For entrepreneurs, understanding and utilizing this principle means recognizing the importance of indirect connections to build a network. As entrepreneurs notify others about their business ventures, these connections broaden, enabling access to crucial resources and information by leveraging relationships through various intermediary links .

To maintain and expand a social network, entrepreneurs should build trustworthy relationships by ensuring reliability and credibility—fulfilling obligations and promises. They should engage with their network consistently and predictably, acting respectfully and with integrity. Furthermore, entrepreneurs should actively seek new contacts and be strategic about how and when to approach potential network members, adjusting plans if initial attempts fail, and using tools like business cards and contact records to facilitate re-engagement .

Super-connectors are pivotal because they possess extensive and diverse networks, which provide shortcuts to powerful individuals such as influencers or key decision-makers. By connecting with super-connectors, entrepreneurs can access a wider array of contacts quickly, thereby enhancing the likelihood of acquiring beneficial resources, opportunities, or information without navigating numerous individual links .

Actively and persistently enlarging the social network strategically positions an entrepreneur to leverage unforeseen opportunities in the long term. By continuously expanding and diversifying their network, entrepreneurs can access new markets, adopt innovative ideas, and respond adaptively to industry changes. A robust and varied network can provide enduring competitive advantages through access to diverse expertise and resources, fueling sustained business growth and innovation .

Trade organizations and industry associations serve as platforms for entrepreneurs to meet other business persons, exchange knowledge, and access valuable industry-specific resources. Membership in such groups can lead to collaborations, partnerships, and gaining insights into industry trends and innovations, all of which can significantly expand and enrich an entrepreneur's social network .

'Mutually acceptable and integer actions' promote ethical behavior in networking by ensuring actions are agreeable and fair to all parties involved. Adhering to such principles ensures that interactions are conducted with honesty, respect, and integrity, which fosters trust and long-lasting professional relationships. This ethical approach can enhance networking effectiveness by ensuring that business agreements and collaborations are trustworthy and reliable .

Facebook can be used to connect with a broad audience, facilitating the revival of old connections and the establishment of new ones, which can be beneficial for business networking. Entrepreneurs can leverage Facebook to engage with potential clients, partners, and industry contacts, share business updates, gather feedback, and even seek support and advice through various groups and pages dedicated to business and entrepreneurship .

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