May 09, 2014
SMEs are aware that they need to improve their networking to grow their businesses, but many don't know how to go about it, according to new research commissioned by accountancy firm Kingston Smith LLP.
The report, conducted by the business schools of the Universities of Surrey and Greenwich, analysed data from a survey of over 1,000 successful SME leaders, as well as from focus groups and in-depth discussions with 25 individual owner-managers.
It found that while 94% of SMEs considered direct referrals important to their success, most regarded social media as "a necessary evil". In addition, although SMEs considered LinkedIn to be of equal importance to traditional networking events and nearly 90% used networks and social media, over 35% of SMEs did not consider their use of these to be effective.
Respondents said that social media is not a substitute for face-to-face events. But the research shows that SMEs believe it is vital to be selective about attending networking events to avoid "event overload". The report concludes that having a clear strategy for networking is just as important as a marketing strategy.
Professor David Gray of the University of Greenwich, said: "Successful SMEs are mindful of both the potential benefits, and dangers, of spending time networking on social media. While they value LinkedIn for showcasing their business and establishing their brand, they are wary of getting too sucked into discussions, losing sight of the need to find new customers. The same is true of Twitter; but there is the danger that tweeting may replace genuine business activity."
Study co-director Professor Mark Saunders, of the University of Surrey, said: "Our research shows that SMEs need to be strategic in their use of offline and online activities to maximise their effectiveness and avoid falling into the time-wasting trap. Social capital – the quality of goodwill created through these activities – provides information and influence from which SMEs can yield valuable business development opportunities."
The report recommends that SMEs should:
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