Objective

Every entrepreneur needs to depend on others for the success of his/her business. Suppliers, employees, partners, advisors (Tewatohni’saktha), funding agencies (Tewatohni’saktha, Aboriginal Business Canada, DIAND, NACCA), distributors, newspapers, etc. are all very important to the success of any entrepreneurial start-up.

This session will explore the skill of networking ( The dictionary defines networking as follows:
“To interact or engage in informal communication with others for mutual assistance or support”.
The session will also examine all the interactions that an entrepreneur will need to manage in order to maximize the business opportunity. Successful entrepreneurs have an ability to enlist support, when needed, and are always looking for opportunities to expand their network of contacts.
 

Learning Points

• Learning/developing networking skills
• Realizing the key network partners
• How to manage your network of alliances
• Managing employees and contactors
• Minimizing network costs

Overview

Everyone has a network of family and friends. This network provides emotional and financial support for those within it. It would be difficult to imagine living without a support network. This network is constantly changing ( new additions, deaths, conflicts, moving, etc.).

Entrepreneurs need to develop a business network of contacts and alliances. The reason for this is simply that the whole concept of business and profits is based on knowledge (information) or the lack of it. Consider all the transactions you make – the reason you pay business a profit is for the knowledge ( information ) that they have that you don’t have:

• You pay for milk because you don’t know how to milk a cow, process the milk and package the milk.
• You pay an accountant because you don’t know how to do financial reporting.
• You pay for groceries because you don’t know how to butcher meat, plant vegetables, can products, make bread, make pasta, etc.

Now, you could learn to do-it-yourself, but in a lot of instances you do not want to or do not have the time to. So you gladly pay a profit to someone who has the knowledge ( information ) needed to provide the product/service. In many cases there are more than a few people required with specialized knowledge. Let’s look at an example:

EXAMPLE

If you go to Village Variety to purchase a picture frame for $5.99 you have to consider the time and effort needed to make the product and bring it to a convenient location for you:

1) You need someone with the knowledge to acquire and cut the wood for the frame
2) You need someone who has the knowledge to acquire and cut the glass for the frame
3) You need someone with the knowledge to assemble the frame in mass quantities.

4) You need someone who knows how to export the product ( because it will probably need to be made in Asia in order to keep the costs low.
5) You need a specialist in transportation.
6) You need a specialist who knows the distribution wholesale network for household products
7) You need to have someone who knows the retailers who will stock and sell the product.
8) You need to know someone who can package the product.
9) You need to know someone who can manage all the administrative functions of handling the sales, inventory, and financials.

Now, you can make the picture frame yourself. You will still need to buy finished wood ( and pay a premium unless you want to cut down a tree – in which case you would need an ax which you would have to make, etc. ). So, in this case, paying $5.99 for the picture frame, and all that knowledge to make it and get it to you, is much better than making it yourself.

There are situations where it is more economical to do-it-yourself. If you have the knowledge to fix your car, shingle your roof, or cut your own lawn then you can save money by doing one of the functions required but you would still not be making the car parts, making the shingles or building the lawn mower.

So, we are constantly paying others for things we do not make or do ourselves. We also get paid for having information that others need and our salary/pay is based on the knowledge/information we have that others require.

We don’t have knowledge about everything. We tend to specialize in a particular area and use others, in our network, to complete the knowledge chain. In fact, it is very seldom that we can take a product or service from manufacturing to the final client without using other expertise in our network.

So, entrepreneurial success is dependent on having access to a knowledge network in the industry that we are doing business. The solutions are available to any problem that may occur it is just a question of having access to the relevant expertise in your network of contacts. Suppliers, distributors, manufacturers, advisors, employees, industry experts, partners, industry associations and designers may all be essential people in your network. Some may be on your payroll, some may give information free of charge and some may get paid for a specific contract. The common theme is that they all have essential information that you need and the key is for you to get that information which will give you the knowledge to be successful. Sometimes a few hours of talking to an expert can give you the all information you need to take care of a lot of problems. Other times you may need the expert on a repetitive basis ( e.g. an accountant to do your books each year ).

It’s important to realize that someone has the answer to any question you may have about being successful in any industry. You need to have access to these people through your network of contacts and you should constantly expand your contacts whenever you have the opportunity. Whenever you have a need you communicate it to your network and you get the friend who knows someone who has a brother who has the solution. The network generates new contacts who help you to move forward. No surprise that the entrepreneurs with the largest network of contacts have the highest degree of success. Also realize that these contacts take years to develop and often you can find a key contact who has his/her own network of contacts ( built over years ) who can provide a solution for you.

EXAMPLE

When Johnny Montour started his restaurant he had a mentor who was a restauranteur for many years. This mentor helped Johnny develop his menu, hire staff, gave Johnny access to his suppliers and guided Johnny in how to prepare meals ( production ). The mentor also helped Johnny with his promotion of the new restaurant.

Concept

Throughout all the entrepreneur cases, and in every study of entrepreneurship, there is one thing that is common to all the entrepreneurs - their ability to network, negotiate, and meet the people needed to help them move forward and enlist support to get the job done.

Every entrepreneur has a vision of what they want to accomplish. That vision is powerful enough to provide the fuel necessary to overcome inertia and get the business started through lots of hard work and determination, often in the face of significant negativity. At some point the entrepreneur needs to reach out to others for help in order for the business to survive. The entrepreneur needs to share the vision, to get others to also believe strongly in the path chosen. The ability to do so is critical to the success or failure of the business.

CASE

Kanata 2000

The greatest overall example of using networking and alliances is the Kanata 2000 project. Lynn and Eva had the vision of affordable, environmentally conscious housing. Initially they were the only ones with this vision, and, given that it was so new and unique as a concept, most people thought they were crazy.

At this point they could have given up when faced by the rejection but the vision was stronger than the negativity and they moved forward, often uncertain about the next step. They contacted building designers and began to get their interest in the project. They worked with the designers to develop the initial plan of what the house should include. So, at this point, they were able to at least communicate their vision, successfully, to the housing designers who became the first alliance partners.

They needed to get the support of local contractors to build the house. This required considerable communication skills because the contractors were initially not comfortable building a revolutionary type of house. Lynn and Eva were able to communicate the vision successfully because the contractors eventually did the project. The contractors became another key element in the network, providing vital knowledge in the construction (production) area.

Volunteer labor was also needed and this required the communication of the dream, the vision, so that Kanata 2000 would get the workforce needed. This became a reality as others interested in conservation became excited about solar energy applications and straw insulation. They then volunteered to work on the project. The Mohawk Council needed to be involved and Lynn and Eva were able to successfully involve the council. All along the way there was a constant need for funding. Lynn and Eva were able to approach funding agencies for financing and get them to see the vision as they did. Otherwise the project would not be a reality today.

Now that the project is a reality, there are many who see the benefits and value of the project. Initially only Lynn and Eva had the vision and it was only through their dedication and determination that the project became a reality. They persevered by communicating the vision strongly to one small group after another as the need arose. Now, major real estate publications (another piece of the network – providing promotion {marketing} for the project)  are communicating the vision that began with a dream on the part of two visionaries who had the conviction of their beliefs.

Initially, Lynn and Eva were the only ones who saw a problem ( pollution ) like everyone else, but had a vision for a solution ( like no one else ). It would have been easy to give up because they had no expertise in house design and house building. They had no money for this project and they didn’t have the land or the people to build the house. They didn’t completely understand the technology of straw insulation or solar heating. It would have been very easy to give up, to justify that they couldn’t do it because the project was too large and they didn’t have the knowledge ( information ) needed to make it a reality.

They persevered however. They determined the essential knowledge that was needed at each stage of the project and they then sought the critical alliance partners, with the knowledge, who were needed. They then communicated the vision to them in a way that motivated these alliance partners to commit to the project in their particular area of expertise.

Eva and Lynn developed a network, over time, of the people needed to make the project a reality. This network of knowledge is now established and Eva and Lynn can access this network for future projects.

Application

All successful entrepreneurs need to create a network of knowledge, an alliance of people who have the expertise to help move the business forward. In order to accomplish this, the entrepreneur needs to overcome two main obstacles. These obstacles are within themselves and are as follows:

1) The belief that they have to do it all themselves. They don’t need help and they don’t want to share their vision with anyone else.
2) The belief that they are too “shy” and are reluctant to approach others for the information/knowledge needed to move the business forward.

The only way to get over these obstacles is to make your vision an overpowering obsession. If you can internalize the vision to a point where it consumes you then you will find the internal strength to actively seek the help needed to make that vision a reality. You need to be motivated to seek others help and to take the time and energy needed to enlist support. If you need ( not just want ) your vision to be fulfilled then you will find the internal power to reach out for the support needed to fulfill that vision.

Methodology

Once you have the internal drive to achieve your vision, you need to determine who will be necessary to help you toward that objective. Then you should decide if you just need information from that source, if you need to contract that source of information, or if you need to hire that source on a part-time or full-time basis.

To find these sources of information ( knowledge ) you can start by:

• Joining industry associations
• Reading industry newsletters
• Attending industry trade shows ( and making it an objective to meet at least three contacts who you can call later to get more information – you need to build your network ).

• Calling and meeting with suppliers in the industry.
• Talking to Business Services Officers who can connect you to retired industry specialists (CESO)

These initial contacts will lead to others ( someone who knows someone ). Follow-up on these contacts and begin to establish that important network of knowledge ( mentors, advisors, partners, contractors, employees, etc.) which has the relevant expertise you need to be successful.

Reciprocal networking

Networking is a two way street. Your alliance network will give you support, knowledge and information when they see the vision and need you have. Never forget that this entails a commitment to return the favor when needed.

Information and knowledge is a commodity which has value. You can buy, sell and barter knowledge. If someone gives you knowledge that you need then there is an implied exchange needed to complete the transaction. It can be as simple as buying lunch for someone who gives you information. It can mean paying someone weekly for ongoing information/knowledge/expertise. It can mean repayment by giving the supplier an order. It can also mean that you provide your expertise for the other person in the network when they need it. In any event never forget that your network will crumble if you don’t also support those who are instrumental in helping you succeed. In many instances a simple “thank you” is adequate – but always look to help those who have been important in getting you to your vision.

Key people

Your network will typically need the following components. You will need to show them your vision and the passion you have to make it happen. They will need to be convinced that your vision is achievable and that you have the internal drive necessary to fulfill it ( with their help ).

As a starting point, one of the first alliance partners, critical for your success, is Tewatohni’saktha. A funding agency and a source of other key contacts for your network, Tewatohni’saktha is ready to assist any entrepreneur who has a strong vision and the determination to make the vision a reality. The first opportunity you have to start a network, and get an excellent lead alliance partner is with Tewatohni’saktha. You need to show the BSO’s your determination through your vision communicated in the business plan. Also, your first opportunity to get help is through your active networking with the BSO’s who will help you access the knowledge/expertise you need if you approach them with specific needs that you have related to the business vision you want to accomplish.

The following are some usual alliance partners needed in your network:

Summary

It’s all about information/knowledge. Doing business successfully is a function of having access to the knowledge to get you product/service to the customer most effectively and efficiently. This requires a multitude of skills and entrepreneurs cannot be expected to be masters of them all.

So, the ability to create a network of knowledge is essential for success. The entrepreneur with the network of contacts who can get information to the entrepreneur, when needed, is a distinct advantage. It’s all about contacts and networking.

To begin with, an entrepreneur must have the compelling vision that motivates him/her to develop a network to help to achieve the vision.

It is up to the entrepreneur to overcome the obstacles to networking and actively seek opportunities to expand his/her network. Some starting points are industry associations, suppliers, and trade shows.  Networking is also reciprocal – an entrepreneur has to give to the network as well as receive.

EXERCISE #1

Every entrepreneur needs information. List the top 5 information needs you have in order to move your business plan forward:

e.g. I need to find out where to get a local supplier

1)

2)

3)

4)

5)

EXERCISE #2

Given the needs itemized in exercise # 1, determine the starting contact person who can help you get the answer. Develop a specific strategy on how you will approach the person and ask for assistance:

e.g. I’ll check with my BSO tomorrow and ask for a contact to a CESO expert

1)

2)

3)

4)

5)

EXERCISE #3

Name the 3 most important people ( by name or title ) that you need in your network right now.

e.g. A supplier who will provide me with small amounts of product at wholesale prices

1)

2)

3)

DISCUSSION QUESTIONS

1) One aspect of a network is to evaluate whether the people are providing value. Often you will meet people who will promise to get information or provide a service and you’ll find they don’t have the ability to make it happen. How do you “fire” people from your network? You can’t waste time with people who are taking up your time without providing value – how do you get these people out of your network?

2) Is there a potential for other alliances like the golf courses have in Kahnawake? In what industry? Under what conditions?  Could this be a benefit for sustainable economic development in the community?