SMEs must get better at networking, research shows About the university

Professor David GraySmall to medium sized enterprises (SMEs) know they must improve their networks and connections to grow their businesses, but do not know how to go about it, according to new university research.

A study carried out by the university’s Business School, in partnership with the University of Surrey, analysed data gathered from a survey of over 1,000 successful SME leaders. Researchers also held focus groups and in-depth discussions with 25 individual owner-managers.

Results reveal that, while 94 per cent of SMEs considered direct referrals important to their continuing success, most regarded social media as ‘a necessary evil’. Meanwhile, although SMEs considered LinkedIn to be of equal importance to traditional networking events, and nearly all used networks and social media, more than a third of these businesses did not consider their use of these to be effective.

Professor David Gray, Chair in Leadership and Organisational Behaviour at the university, who co-led the research, says: “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 – it can be a highly effective tool for SMEs when used in conjunction with other social media, such as the business’ website and blogs, but there is the danger that tweeting may replace genuine business activity.”

The research, commissioned by top 20 accountancy firm Kingston Smith LLP, also makes clear that social media is not a substitute for face-to-face networking and events. Face-to-face networks are highly valued by SMEs, both to supplement a social media presence and in their own right.

The study’s co-director, Professor Mark Saunders of the University of Surrey, adds: “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’s key recommendations are that SMEs should develop a social capital strategy within their business plan; have an effective policy for, and monitor, social capital-based activities; seek to achieve a realistic return on investment; and consider the wider benefits of social capital and maximise them.

A copy of the research report, containing further key findings and recommendations, can be downloaded from Kingston Smith’s website at

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