Im not sure where the modern idea of networking really began, but I seem to remember Jerry Rubin and networking breakfasts in New York City in the 1980s
Hardly anyone still remembers that! Jerry actually succeeded in getting a federal trademark on the words, business networking. Years later, the trademark office said there was no way they should ever have approved that, but they did.
I wanted to trademark The Business Network, but I couldnt, because of Jerrys trademark. So we ended up trademarking the name BNI, which stands for Business Network International.
Where did the idea of business networking start?
The U.S. Chamber of Commerce claims to have coined the term itself, but the process of business networking really goes way backactually, to almost exactly one hundred years ago.
The earliest example of an organization that focused on networking was the original 1905 charter for the Rotary Club. The organizations name derived from the practice of rotating their meeting location every week from one members place of business to another. When Paul Harris founded Rotary Club of Chicago, he stated its purpose as the scientizing of business relationships. This was the era of scientific management, so thats 1905-speak for business networking.
The Rotary Club soon changed their focus to being of service to the community. But at first, they were formed as a true business organization, and even today they still do a lot of networking.
Didnt the term networking have a negative connotation, back in the seventies and eighties, with images of the exclusive old boys network?
Right, the business elite, the country club set. That phrase also referred to the service clubs themselvesRotary, Lions, Kiwanis and the restwhich were men-only organizations until 1986. It wasnt until 1986 that a Supreme Court case forced Rotary Club to allow local clubs to decide whether or not they would admit women.
I joined the Rotary Club right in 86, and I got to see first-hand how much resistance there still was to the idea.
How the world has changed!
Indeedand that was only twenty years ago!
You formed BNI a year earlier, in 1985. How did you come up with this idea?
Id like to tell you I had this vision of an international organization with groups all over the world. But the truth is, I needed some referrals for my consulting practice.
What kind of practice was that?
I was doing management consulting, with a focus on organizational behavior. I enjoyed it a good deal and made good money. When one of my major clients decided not to renew their contract, I was completely taken by surprise. I had helped them to create a good sales division, but hadnt realized how badly undercapitalized they were.
This one client represented about 40 percent of my business; it was pretty devastating. I needed to come up with something fast. I asked myself, How do I get most of my business? And the answer was, 1) through speaking engagements and 2) through referrals from friends.
To address that first answer, I went out and started doing more speaking at the Rotary and Kiwanis Clubs. I spoke to about 200 service clubs, and enjoyed the camaraderie especially at Rotary that I ended up joining.
To address the second part, I put together a little group of people I trusted, and we started meeting regularly to pass each other referrals. At first, I simply called it The Network. Eventually I changed that to BNI.
How did the original group grow to become a worldwide organization with more than 4,500 chapters and 90,000 members?
I never planned on having any more than that one group in Arcadia, California. That was all I needed. These were friends of mine, and I knew that they would refer me and I would refer them. From the very beginning, we had this philosophy: Givers gain. Ill give you business, you give me business, well all do better as a result of it.
But someone came to one of our first meetings and said, Wow, this is great! I could get a ton of business out of thisbut I cant join, because you already have one person in this profession. Would you help me open up a second group?
So you started out with that structural idea of one person per profession?
From the very beginning. We wanted to create a safe environment where you could share everything about your business, knowing that there wouldnt be any competitors sitting there listening. In retrospect, this turned out to be a really powerful decision.
It was brilliant.
To serve this one person, we opened up a second group in Pasadena. About twenty-five people came to the second meetingand two couldnt join because of the conflict. Both of them said, Wow, this is great! I could get a ton of business, but I cant join!
So we opened up two moreand this time three people came to those groups who couldnt join
I see where this is going!
I ended up opening twenty chapters in that first year. We had no manuals, no brochures, just an agenda typed up on one sheet of paper on an IBM Selectric. With that one sheet, we launched twenty groups.
At that point I sat down and said, Ive really struck a chord here.
Id thought most businesspeople had a handle on this referral thingbut now Id discovered that they didnt. My experience was just like that of so many others.
Once I realized this, I started organizing the program, creating training systems and manuals and so forth. And today we have chapters in thirty-four countries around the world.
What do you think changed in the business environment that created this huge need BNI filled?
A lot of it has to do with the proliferation of small businesses, which in turn has a huge amount to do with technology. Suddenly a one-person shop could look like a 100-person shop. Today, with full-color printing, you can produce a document that was impossible to produce when I worked for corporate America in the eighties. I think thats one of the biggest reasons weve seen such a huge wave of downsizing and deconstructing of corporate America.
And all of these small businesspeople need referrals.
Thats right. That said, though, a good one-third of our membership are salespeople and others who represent big corporationsNew York Life, Century 21, AT&T and the rest. Another third are self-employed entrepreneurs, folks who run the local floral shop or print shop. And about a third are traditional professionals, the local banker, CPA, attorney and so forth.
Do you see a significant presence of network marketers joining BNI?
Actually, a huge number of them. Just about every major network marketing company in the world is involved in BNI, and probably every single BNI chapter has at least one network marketer as a member.
That begs a question: we network marketers have come to refer casually to what
we do as networking, but the two are really quite distinct concepts.
How do you see network marketers functioning within the broader world of networking?
Thats a great question, and I want to answer it carefully, because a large percentage of our members are in network marketing and most of them represent very reputable companies. But there are a handful out there who still do that blind marketing that drives me crazy, and it sometimes creates challenges within my organization.
Still, thats a very small minority.
Are there any other areas where we need to improve in our relationship to networking as a whole?
One thing some companies and organizations simply do not get is that when youre in the context of an organization like BNI, it just doesnt work to maintain an exclusive focus on your business opportunity. Some network marketers come in and focus so strongly on presenting their opportunity that they never talk about product at all.
Now, that approach may work very well in other situations, but not in a networking group like BNI. Here, the entire premise of the organization is that you are the only businessperson in this particular group who represents your particular product or service. If your product is your business opportunity, that poses a problembecause we may have a number of different network marketing companies represented in the same chapter. In fact, this is not at all uncommon.
Now, if you want to promote your business opportunity, thats fine, but do it one-on-one with the individual.
Which is a more effective way to approach it anyway.
Exactly. Because youre talking with an individual and actually engaging with that persons own specific needs and interests. But youre not as likely to interest your banker or CPA by standing up in front of thirty people and saying, You too should represent this great product.
Whats at the core of this issue? Is it a matter of respect, of putting yourself into the other persons shoes?
One of the issues I talk about in the new book, Truth or Delusion?, is this idea, You can network anywhere, anytime, anyplace, even at a funeral. Believe it or not, that is actually a truth, not a delusion. But the key to making it work is the answer to your question: You have to honor the event.
If youre at a church function, you dont go walking around passing your business cards out. Its not appropriate.
Our idea of networking is this: the best way to build your business is to help other people. A good networker has two ears and one mouth and uses them both proportionately. You pay attention to what people are saying. Theyre going to express needs to you. If you can help them in some way, without trying to sell them, youve made a connection.
And when you say help them in some way, that may or may not have anything to do with our product.
Thats exactly it. Ill give you an example. I was recently at a church functionand I was not walking around passing out business cards. But there was someone there whom I wanted to get to know because of the business he was in. We struck up a conversation and I started asking him questions. I found out that he was trying to create his own foundation, but he was struggling, because the company he was with wasnt quite big enough to start its own foundation.
I said, Are you familiar with the California Community Foundation?
He said, No, never heard of it.
I said, Theyll do exactly what youre looking for. Theyll help you create, in effect, a mini-foundation.
He said, My God, Ive never heard of anything like this!
I said, Look, heres my card. Give me a call on Monday. If you want, Ill email you some material and Ill explain to you how it works.
He was ecstatic. I helped him solve a problem he had.
Now, if I need to pick up the phone and call this man, do you think hes going to take my call? Of course he isbecause I helped him out. No strings attached. I didnt ask for anything from him.
All too often, we try to close someone on doing business before they even know us. We try to convince them right there on the spot that they need our products or services, before theres any relationship. And then we wonder why people get turned off.
At BNI, we train true relationship marketing: get to know people, get to help people. If you help people, theyll take your call. Build a relationship, and theyll connect with you.
Are network marketers on the whole, as a culture, going in the direction youre describing?
Absolutely, theyre doing much better than, say, ten years ago. There are still a handful of organizations that dont get it. But weve had tremendous success with people from many, many companies.
I suspect that people like yourself, Bob Burg and others have been teaching this message, Givers gain, so consistently that it is sinking in.
It has certainly worked within our organization. Last year, we passed 4.4 million referrals and generated $1.7 billion worth of business for our members all around the world. Thats the same as the gross domestic product for the country of Liechtensteina small country, admittedly, but its pretty cool that a group of businesspeople can get together every week and pass as much business as a small nation.
Let me pose the question thats on this issues cover: Ive run out of people to talk to Now what?
The first time I heard that was at a BNI meetingand it was me saying it! We were up to three or four chapters when I turned to one of our members and said, Thats it! Ive run out of names. Ive got nobody else!
And Ill never forget what she said: Come on, Ivan, youve contacted every person you know who you think would be good in BNI?
I said, Absolutely.
She said, All right. Tell me, have you actually gone through your Rolodex, card by card, and looked at every single card?
And I said, No but I know whos in my Rolodex.
No, no, no, she said. Youve got to go back to your Rolodex and look at it literally card by card. Then she said, Do you have a card file, a box where you save everybodys business card?
Absolutely, I replied.
Have you gone through that card by card?
Then she said, Have you looked at your checkbook? Who are you writing checks to? Who are you getting money from?
I went back and looked in all three places shed saidand she was absolutely right, I found a bunch of people.
And look where BNI is today.
Indeed. You think you remember all your contacts, but when I went back to my Rolodex, card file and checkbook, I found myself saying over and over, Wow, why didnt I think of this person? I havent talked to her in six months or a year, but shes a great candidate! I ended up coming up with a huge list.
I still teach these questions today; the one I like best is the idea of following your money. Go look through your checkbook. Who are you writing checks to? Whos giving you money? What a powerful idea!
I think most businesspeople are basically cave-dwellers. They get up in the morning and get ready for their day in this large cave with a big-screen TV. They go out to their garage and get into this little cave with four wheels, called a car. They drive to this other really big cave with computers, called an office, and they stay there all day long. At the end of the day, they get back into their little cave with four wheels and drive back to their large cave with the big-screen TV.
And they cant figure out why no one is referring them.
Networking is a contact sport! You cant stay in your cave all day long and expect people to think of you, send referrals your way or refer you to others.
In my book, Business by Referral, I describe something we call the VCP Process: visibility, credibility, profitability. You must first be visible in the community: people need to know who you are and what you do. Then you have to establish credibility.
Its only once youve established visibility and credibility that people will send you referrals over and over again, leading to a relationship that is genuinely profitable.
So theres sort of a built-in paradox about networking: the way you help yourself is to help other people.
This is the key: networking is not a solitary event. You cant do it by yourself. In our culture, we tend to place a high value on the entrepreneur, the loner, the rugged individualist who says, I can do it by myself. No, you cant!
Networking is something you do with other people. In the game of networking, the one who helps others is the one who wins.