The internet and social media are changing the ways that small and medium-sized firms network with other businesses, according to recent research from The Open University Business School. The latest Quarterly Survey of Small Business in Britain examines recent trends in networking by SMEs, including new ways to interact, key benefits of engaging and reasons why some prefer to remain disconnected.
The survey of 1,109 business owners was conducted during January and February 2014*. It found that two thirds of those who say they are involved in formal or informal networks (66%) think that the growth of the internet and social media has changed the way they engage with those networks. For example, more than half (51%) of the relatively larger firms (i.e. those in the £5m+ turnover band) are members of at least one business or professional organisation, and just under one third (30%) of those in the smallest turnover band. Almost one third (32%) of these firms ‘mainly’ engage with business and professional organisations online and 80% report using a combination of face-to-face and online communication; only a small minority (12%) communicate ‘mainly’ through face-to-face methods such as meetings and social gatherings. Face-to-face communication remains more important for informal networking, with only 14% of these respondents saying they do so ‘mainly online’, while almost half (47%) use a combination of face-to-face and online channels.
Dr Richard Blundel, Editor of the report and Senior Lecturer in Enterprise Development at The Open University, said: “Our research reveals the changing nature of networking amongst the UK’s small and medium-sized businesses. Face-to-face interaction will remain important, particularly in more informal and local networks, but online communication has become a core component, helping people to connect in ways that were inconceivable a few years ago. I think there’s also a big question over those who choose to remain isolated – many of the reasons given sound pretty convincing, but occasionally you sense that someone is rationalising a decision to remain isolated, which is actually quite harmful to their business.”
Other key findings on the special topic theme of recent SME networking trends:
Reviewing the findings, Dr Blundel concluded: “Our report also points to a number of practical things that smaller businesses can consider when they are deciding how to make effective use of their networks. For example, if you’ve finally found some breathing space after the recession, it could be time to review your network connections: do they fit with the new landscape and your future ambitions? It may be time for a ‘spring clean’, severing a few old ties that are no longer relevant to your business and making some new ones that could support you through the next phase. One of the strong lessons from the research, which is highlighted by two of our case studies, is that online technologies are providing an opportunity for new business and networking opportunities for small firms, even if they are relatively small or geographically remote.”
Sue Hayes, Managing Director for Barclays Business Banking commented: