Networking for Synergy, Survival and Growth
Dr. Arnold F. Itao
Henry Ford once said, “Coming together is a beginning, working together is progress, keeping together is a success.” Based on our experience, this is really a gem of wisdom. We had the opportunity of working with networks and of helping establish others in the context of our development work.
A network can be described as a “formal or informal cooperation between three or more organizations with a common interest to reach a certain, implicitly or explicitly formulated, common goal together.” Networking can be defined as “the process resulting from the conscious efforts of certain social actors to build relationships with each other to enhance the performance” (P. Engel, The social organization of innovation, 1997). The definition implies that the organizations participating in a network coordinate in drawing each other’s strengths in reaching a common goal, participate with or without written agreements and keep their organizational independence.
The active components of a network consist of (a) actors as individuals and as groups, (b) the relationships between and among these actors, (c) the resources they have at their disposal, and (d) the activities they perform. Both actors and relationships can show various characteristics. Effective networking requires that actors have a relationship orientation that is long-term and dynamic, and the recognition that they can achieve positive synergies in terms of effectiveness and efficiency in achieving their shared developmental goals.
The common sequence of developing relationships of cooperation (1) starts with the individual actors building personal relations, (2) continues on to fostering informal organizational relations, (3) moves on to forging formal organizational relations, and (4) completes the process with institutionalized relations. The four phases have their own set of characteristics, cooperation modes and reasons for existence. Hence, networks exist under each phase. Some networks do not mature into the fourth stage by reason of choice, external environmental factors or inherent weaknesses.
The opportunities for cooperation in a network are varied ranging from exchange of information, cooperation on outputs, cooperation on inputs, and joint (or coordinated) policy lobby and advocacy. The motivation to organize a network must start with the members out a common felt need, although external forces such as government, clients and donors may want to give the push to speed up the process. As in all human endeavors, a champion is needed to provide the initial impetus and spark to get the networking process in motion and on fire.
Networking agreements, whether formal such as through Memorandum of Understanding (MOU), informal or loose, would usually cover such issues as the network’s goals in contrast to those of the individual members/organizations, cooperation and coordination mechanism, structure, joint activities, communication pattern, exchange of outputs and expertise, sharing of resources and responsibilities, secretariat, funding and payment of services or products.
Networks can be attractive to the members since networking means:
Ø growing together
Ø working together to achieve synergy
Ø working together for mutual benefit
Ø working together for a common target group
Ø working together to avoid duplication
Ø reaching out together for a shared vision
Ø sharing resources, work and cost
Ø complementing each other’s strengths and weaknesses.
Network is relationship-oriented. It is the feeling of symbiotic relationship. One needs each other. Networking is a commitment to achieve something together, rather than agreeing to certain tasks and goals. No one organization is insignificant to attain the common objectives. The goodwill that is gained in networking can be demonstrated by the members’ willingness to abide by the principle of work sharing and cost sharing, not necessarily equally.
The relationship between the network and the individual members is very crucial. The individual members’ independence must be safeguarded, their institutional capacities strengthened, and networks should not pose as a threat to the individual members in terms of destroying their image, weakening their markets, and nurturing competitors. It is a fact of life, however, that competition (for instance, in marketing business development services and accessing funding sources) can exist among members of the same network working in the same territory.
Network members must do a balancing act – when to collaborate and when to compete, or what to share and what not to share. It is much like being a member of an industry association or a chamber of commerce. It is cooperation in the midst of competition. Networking means a win-win situation. Unhealthy competition stifles the spirit of cooperation. The network should therefore actively demonstrate its benefits. A network has to deliver benefits that individual members cannot obtain by working outside the network or without the network.
We helped organize three networks of local service providers for SMEs in Thailand. One network opted for a formal signing of MOU from the beginning, the two others chose to take a looser form of cooperation at the start with the intention of formalizing their relationships once enough track records, experience and interactions have been achieved.
In our experience, the more financially endowed organization with much experience and expertise can be more generous, that is, giving more and expecting less in return. In the development world, these two possibilities exist. We refer to South-South cooperation among developing countries, and North-South cooperation between a developed economy and a developing economy. In the same vein, these two modalities exist between and among organizations.
Our own experience with networks and observation with others indicate that there are critical success factors (CSF) in networking. Among them are: (1) dynamic leadership, (2) ownership of the network by the members, (3) shared values and aspirations, (4) common felt need to establish network, (5) strong commitment to cooperate and to share, (6) formal binding agreement, (7) sustainable funding, (8) able professional secretariat, and (9) strategic and action plans.
A strong and dynamic secretariat is very crucial in the life of a network since it should function as the nerve center and not as a business center. It should be the think tank, the facilitator and the coordinator. Working in the secretariat of Technonet Asia, a Singapore-based Asian network with participating organizations from several Asian countries, for the purpose of sharing and exchanging experiences and technologies in the field of entrepreneurship, technology transfer, etc., for small and medium enterprises (SMEs), we were busy contacting and visiting the participating organizations for follow up, monitoring, planning, coordinating network activities, making proposals for donor funding, etc. The members rely on the secretariat for pro-active support and to make things happen.
The governing body and the secretariat must be creative in their ways of making the members satisfied, especially where membership fee is involved. Members equate their participation in terms of cost and benefits. Some member-satisfying activities are: supporting individual members’ pilot projects; undertaking joint activities such as training, conferences, workshops and research; organizing study visits to other member organizations; seconding members’ staff to the secretariat; and providing fellowships. What is important is that the governing body and the secretariat are always creating innovative projects, adding value to members, and ensuring the availability and flow of funds.
Besides these CSFs, some fundamental guidelines in establishing a successful network include: good governance, trust among the member organizations, sustainability, transparency in decision making, teamwork, regular face-to-face contact, equality among members whether large or small, rich or poor organizations, excellent communication facilities, and no politics, that is, no vested interest by one organization or one group to grab power or dominate decision making for selfish gains.
In the Thai-German Small-Scale Industry Promotion project where we worked in advisory capacity, the existence and the institutionalization of a functioning and effective network of local business development service (BDS) providers for SMEs in three project locations was one of the expected results. The first phase tasks covered: organizing network orientation workshops, conducting network development workshops, defining the key elements of network concepts, supporting the process toward the establishment of networks, formalizing network coordination system and structure, designing and implementing network performance monitoring system, and empowering the network and its members. The second phase of the project continued to nurture the new networks in terms of setting up cooperating mechanism and procedures among network insitutions, continuing to support the organizational and capacitiy development of networks through technical and financial assistance, and producing a network manual.
The networking project result produced some good practices. These good practices are the product of several years of promoting, supporting, adjusting, monitoring and evaluating networking work process, organizational development, capacity building, formulation and delivery of innovative business development services to SMEs. In the course of supporting and implementing networking activities, valuable lessons from both successful and not-so-successful project interventions, were obtained. Among the lessons learned in the form of Dos and Don’ts are as follows:
1. Have a clear concept of the network objectives, functions, responsibilities and commitments from the very beginning of its foundation.
2. Elect a good leader who is dynamic, flexible, and innovative and is acceptable by the members.
3. Develop criteria for decision making as well as job description of the members, committees and staff.
4. Establish effective and transparent communication patterns between committee members and between the members and the secretariat.
5. Have an MOU as the guiding principle and reminder to the members about the very essence of their networking.
6. Ensure adequate facilities, funding and manpower to run day-to-day management and operation.
1. Don’t use numbers (number of members) to indicate the success of a network, instead go for quality and the commonalities of mandate, target group, services, etc., of organizations as network members.
2. Don’t start with a big number and don’t expand membership too fast. Put the organizational structure in order first and show visible and tangible results for demonstration purposes.
3. Don’t let any organization or person dominate the decision making process.
4. Don’t treat the network as a social club.
5. Don’t expect that funding will come automatically from the sponsoring organizations.
6. Don’t make the network a channel for personal or vested interests.
We would like to end with an anecdote. There was once a very rich businessman with one daughter and two sons. On his deathbed he called them together and told them that as he was dying he would turn over management of the business empire to one of them. It was important for him to know how they were going to manage the business and so he asked each one of them to bring him a symbol of her/his management style. Soon they all came back. One son brought an eagle’s feather and told his father he would run the business like an eagle’s eye. The other son brought a modern book on management assuring his father he would run the business like a professional manager. The daughter came with a flower with three petals and told her father she would run the business with her two brothers. The dying father awarded the business to his only daughter, saying “Together everyone achieves more.” Indeed working together is the essence of networking.
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