I was recently interviewed for an extended article Networked Business: The wealth in your connections written by Nick Saalfeld for the Microsoft Talking Business series.
Here are some excerpts from the article, which provide a neat summary of some of my thinking on the space.
It’s a fallacy to think of networking as a sales tool. Firstly, it’s not. Secondly, it might instead be one of the defining sources of value in your business. Business strategist Ross Dawson, author of the (free and highly comprehensible) Future of Work Framework explains how.
“Thanks to technology, we can work anywhere. Social trends, meanwhile, show that workers have higher expectations of their jobs, workplaces and career options. The freelance economy is booming and corporate structures are flattening.
The structure of business is therefore changing to what I would describe as a ‘modular’ economy, where the relevant entity of value creation becomes smaller and smaller – it’s no longer the organisation that is the primary vehicle for value creation, it’s often the individual.”
In this sense, large companies are often a highly liquid collection of motivated individuals; many of whom will coalesce for only weeks at a time on any one project. There is no pyramid of power. If the concept of ‘a job for life’ disappeared in the 1970s-80s, technology in the 2000s is allowing the talent market to become completely granular, with skills available on demand and businesses operating in as lean and flexible a way as possible.
This is obviously great news for small businesses, who (red tape willing…) will have unprecedented access to corporate clients. But Dawson’s point is more subtle: whether you’re a freelance, a small business or an employee in a larger organisation, your network will be crucial to your very value.
“Two things will make a difference”, he says. “Firstly, your specialist expertise. If you don’t have world-class capabilities, then you’re a commodity. You need to become an expert in your field and put constant effort into learning to stay at the top of your game.
“But secondly, your value in such a fluid world where we move from project to project or job to job will be based on the depth of your connections and the strength of those relationships.
So whilst on the one hand we need to be specialists, experts at something very specific; the corollary of that is that we have to be better at collaboration. This is a more interdependent world than ever before, so customers are looking to work with people who are good at collaborating and bring a network of connections with them.”
The article goes on to explore attitudes to intellectual property and information sharing in networks.
“We need to shift from protecting things by default to being open by default”, says Dawson. “Neither approach is any harder or easier: you just need to make some decisions about how you operate. Of course you need to protect any intellectual property in your business; but if you start with an open mentality, you have a tremendous advantage.”
Crowdsourcing, approached the right way, can be a very powerful manifestation of high-value networks, but it does require providing context to the people you work with.
There is a logical limit to outsourcing, and Dawson says it comes down to ‘context’. Casual, on-demand labour exists without context. That’s why, for example, something as simple as crowdsourced logo design can go horribly wrong: without knowing the soul of a business and its strategy, it’s pretty hit-and-miss to design its brand.
“Again, that context is about strength of relationships”, he says. “It’s why we still have our favourite suppliers or contacts whose advice we trust. When context is less important, we can outsource. And business will certainly become more distributed; it’s an inexorable force. But you can’t outsource trust, competence or brand values.”