Personal Contact Networking

By Author: Sherry Roberts
Total Articles: 81
Comment this article

Abstract
Business start-up can capitalize social networking to gain its growth plan. Personal network contacts and entrepreneur networks have numerous benefits. Biconsultation will benefit from a social network of advisors, investors, mentors, business partners and customers. Personal benefits include sharing of information, extending contacts, introduction to peers, motivation, support and encouragement and product or service ideas. Entrepreneur ventures require capital from informal sources. Trust facilitate access to such capital and other resources through collaboration, and help an entrepreneur over institutional barriers to the expansion of the business. In addition, the unique relationship and connection between people in personal contact network play an important communications role, enabling the entrepreneur to identify opportunities that are not evident to others. Social networks help a start-up business to acquire human, financial and social capital necessary to achieve business goals.
 

Introduction
The term “network” in business refers to the third organizational structure that is ...
... an alternative to market arrangement. There are various types of network structures and categories. The broad category of networks includes inter-organizational and entrepreneur’s personal network. Entrepreneur personal networks consist of a ‘set of ties linking several persons or individuals and provide various type of exchanges.” Personal networks include people connected to each other by a certain type of relationship. These contacts are from the perspective of a specific individual and are ego-centred networks. The importance of social networking for a start-up business is insurmountable. For instance, studies show the effect of social networks on entrepreneurial intent, orientation, opportunity recognition and decision to start a venture. Social networks help a start-up business to acquire human, financial and social capital necessary to achieve business goals. For example, the Biconsultation.com can use social networks to access valuable resources such as reputation, funding, market information, and knowledge. The company will benefits from a social network of advisors, investors, mentors, business partners and customers. The consecutive sections identify, through literature view, how Biconsulation can benefits from maintaining personal social networks and other forms of networks.
Literature review
Benefits of networking
Various studies have identified the different entrepreneurial characteristics that contribute to the success of entrepreneurs. In 1971, Say noted that successful entrepreneurs need to be good decision-makers. Entrepreneur need to feel the need for achievement, have an internal locus of control and have self-confidence. Cox and Jennings (1995) identifies characteristics of successful entrepreneurs include having good communication skills and risk taking. The entrepreneur need t have self-efficiency, recognition of opportunities, perseverance and social skills.
In the book “Exploring Entrepreneurship,” Blundell and Nigel describe the role of personal contacts in creating ventures. They noted that the role of networks in creating ventures is an important area in entrepreneurial activities. Entrepreneurs rely largely on informal sources in their personal contact network to mobilize resources before the formation of the venture. The unique relationship and connection between people in personal contact network play an important communications role, enabling the entrepreneur to identify opportunities that are not evident to others. The PCN provides the entrepreneur a shelter from opportunism and uncertainty in the market. Blundell and Nigel note that the time and energy invested in these networks are converted to future benefits to the business. These benefits include human capital in the form of relevant business skills and knowledge.
Entrepreneur ventures require capital from informal sources. Trust facilitate access to such capital and other resources through collaboration, and help an entrepreneur over institutional barriers to the expansion of the business. Cooke (2012), provided a framework of constructing personal networks. The network consists of general benefits of personal networks and innovation benefits. The general benefits include sharing of information, extending contacts, introduction to peers, motivation, support and encouragement and product or service ideas. Innovation benefits include improving the quality of service, marketing properties of the services, reducing cost and improving the production processes. PROFITNET is an example of an entrepreneur network project. The project is run by the University of Brighton. The first phase of the project comprised of the AIF ProfitNet that came to an end in 2008. The project had seventy-six active members and seven groups. The groups came from the creative, hospitality, construction and technical services, leisure, fashion and design and manufacturing and engineering. According to Cooke (2012), the sectors with the greatest contingent include hospitality, leisure, and tourism. The project was evaluated on the basis of member satisfaction, economic performance, innovation and linkage with other businesses. According to the survey, 82 % of the respondents indicate that the networks are effective in sharing business skills training. 71% indicated that the network is effective in creating supportive social networks for learning and 68% state that the network helps in business strategy training. The projects provide an effective platform for material and psychological support. 93% of the respondents report that they were satisfied with the psychological benefits of motivation, support, and encouragement. In term of innovation, Cooke (2012) notes that network projects facilitate entrepreneur t change their products to meet the needs of customers.
Vissa (2010) investigated the effects of entrepreneur’s interpersonal networking style on the start of inter-organizational exchange ties. He noted that entrepreneur networking behaviors consist of network broadening and deepening actions. The benefits of referral in the networking include gaining the attention of decision makers and stabilizing the dyadic relationship between target and ego. Entrepreneur who engages in network broadening imitates referral benefits without an attendant cost. Greater networking actions imitate screening benefits of referrals. Vissa (2010) also notes that adding new venture exchange partners is critical in the survival and success of the venture. According to Venkataraman and Van de Ven (1998), new ventures that add exchange partners faster are a great chance of surviving business environment challenges.
Perprah (2010) explores the role of networking in making entrepreneurship sustainable. Perprah uses a group of 320 women entrepreneurs and a multinomial logit to determine the effects of network on start-up entrepreneurs. He notes that the entrepreneurs maintain homogenous and cohesive solidarity networks that are designed to reduced information asymmetries and supporting an informational credit and risk-sharing arrangements.
The social networking theory underpins the importance of networking. The theory explains the interchange that takes place within networks. Networks allow flow of objects that may contain advice, friendship, career and emotional support, motivation and cooperation that strengthen ties. Entrepreneurs need to build reputation-enhancing relationship with resource provides who are ready to share valuable information. They use informal and personal networks to form new firms and to certain degree networking determine the success of new ventures.

References
Cooke Y (2013). Is it possible to construct an entrepreneur’s personal network: What can the Profinet project tell us?
Cox, C., & Jennings, R. (1995). The foundation of success: The development and characteristics of British entrepreneurs and entrepreneurs. Leadership and Organizational Development Journal, 16(7), pp. 4 – 9
Dana L (2004). Handbook of research on international entrepreneurship. Edward Elgar publishing company, USA.
Klyver K & Hindle K (2013). The influence of social network structure on entrepreneurial participation.
Landstrom (2010). Pioneers in entrepreneurship and small business research. Springer publishers, USA.
Lechner, C., Dowling,M., & Welpe, I. (2005), Firm networks and firm development: The role of relational mix. Journal of Business

Sherry Roberts is the author of this paper. A senior editor at Melda Research in online nursing papers. If you need a similar paper you can place your order for a custom research paper from legitimate research paper writing service services.