Establishing a successful network involves much more than just exchanging business cards or issuing invitations to connect. It requires taking explicit positions on:
- Why the network is being established;
- The profile of network members to be recruited;
- The minimum network size that can be sustained; and
- Anticipated network developments and how we will respond.
There are many different reasons to establish and maintain a network, including supporting a cause, creating referrals, generating innovative designs, supporting professional development, establishing a market research panel and setting up for bartering. It is also possible to have multiple network purposes for the one network by selectively engaging relevant network members at appropriate times. The network purpose will need to be specified in a way that helps to determine the desired profile of network members and the objectives that will need to be achieved.
DEFINE OPERATING OBJECTIVES
A network established to foster involvement in a hobby such as coin collecting may involve experienced collectors who are interested in sharing relevant experiences and who would be prepared to pay a membership fee. Operating objectives might include: establishing a website with specified functionality by a target date, conducting a webinar each month on a common issue with a recognised guest expert, organising a face to face conference each year and publishing a quarterly member newsletter, and generating $X revenue from selling advertising and $Y revenue from membership fees to cover network costs.
If the network purpose is to organise online charity events, then members will need to be enthusiastic about the charity concerned. Members with children that might benefit from the charity are likely to be motivated to contribute the time necessary to organise events. Operating objectives will be derived from the charity’s event project plan.
If the purpose of the network is to generate business referrals for an investment fund, then members might be licensed financial brokers whose opinion and advice is respected by clients who have funds available for investment. Operating objectives may include a specified net rate of growth in network members and an average rate of referrals per member over a certain time period.
Typically, network operations will include systems that drive membership recruitment, send initial briefings to new members, manage ongoing communication with existing members, and provide ongoing network performance monitoring and feedback to suggest appropriate adjustments. A common mistake in developing network operating systems is to underestimate the time and creativity that will need to be continuously invested to improve network operations and maintain member engagement.
Given estimates of the costs and the time necessary to establish a sustainable network, the minimum feasible network size and the chances of achieving cost and benefit objectives at this size can be assessed. To manage establishment risks, a margin of error of 30% to 100% should be built into time-related cost estimates, depending on previous experience -- time estimates become more accurate as a record of actual time use accumulates.
This is the first instalment of a two part series. Read part two.