Punching above their weight: the role of networking in SMEs

Abstract

Purpose:
We draw upon the findings of a research project which investigated networking styles by owner/managers of small businesses. Our specific objective was to analyse the impact of such networking activities on business growth to develop a taxonomy of networking based on size, business model and attitudes of the owner to their use of online and offline networking.
Design/methodology/approach: Our data comes from analysis of an online survey completed by 645 firms based in both the USA and Europe. We compared the networking behaviours of small businesses using face to face vs online modalities, and assessed the differences between business size and home market (US vs UK vs Europe). The data was analysed for significant differences between the responses of different classes of respondent, providing us with a unique taxonomy of networking across a broad geographic area.
Findings:
Our results identified three distinct categories of networking behaviour in terms of attitude towards scaleability and geographic reach, and we showed that effective online networkers tended to be good face to face networkers also.
Practical implications: We confirmed that effective online networkers can stay small and flexible but still ‘punch above their weight’ in competition with larger organisations that are often more traditional in their approach and structure.
Originality/value:
We have undertaken one of the first analyses of the circumstances in which SMEs make use of web 2 tools to supplement their more conventional marketing activities, and developed a coherent framework for analysing which companies are likely to make the best use of them.

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