quarta-feira, 26 de setembro de 2007

1.10. Hints on Using Online Tools

Plan to build a position of high recognition and confidence inside your network.

1. Choose the best tools for networking online.

2. Present a clear and worthwhile proposal in your profile; be clear about who you are.

3. Connect yourself to the top networkers in each platform;

4. Lead by serving within your own business network;

5. You should share your knowledge without expect anything in exchange;

6. Actively communicate and give indications when you feel comfortable or if you are concerned;

7. An active connector invites a broad range of people to join his or her network. Do that independent of the geography. In a global world you, never know who knows who and what opportunities can come from those connections. You never know when or from whom new opportunities may arise.

8. Look for the ICSAR potential with each partner;
Identity: Complimentary; Synergies; Leverage; Resonance

9. Publish information about yourself on the platforms of your choice. Other people are going to put small pieces of their own profile in many platforms according to their own preferences.

10. Write articles and blogs of general interest. That will increase your visibility and the value of your membership as perceived by the community;

11. Organize a well focused club or online group in a network you participate in regularity;

12. Establish direct communicators by email or by phone to follow up items of interest with the people in your network. This will accelerate the formation exchange and help to create a partnership. It is essential that someone takes the initiative to develop a relationship.

13. Have your references online. This will help to build your reputation and show one's credibility about one's expertise;

14. Be kind to the media, the most powerful of all the business networks. A journalist may be interested in you some day. The confidence of your network in your professionalism and vice versa is the greatest reward that can be acquired as a result of your networking activities. The measure of that confidence solidifies through time. The frequency and volume of the commercial transactions will slowly grow. Confidence and trust are the cement used in the building of worthy partnerships and of long term.

1.9. I.C.S.A.R.

Networking is in the first analysis respect for the values, moral foundation, ethics and nature of each other person. It does not have so much to do with education, years of experience, personal meetings, experience of prior work, etc… Someone who has been a dependable person will also be dependable in the virtual world if they have been in the real world. He or she can be in Brazil or in any another country of the world, that doesn't matter.

The question we all ask about our new connections is, will this new contact be good or bad for us? We've developed an own methodology for checking our contacts based on five basic points called I.C.S.A.R: that is defined in this way:

1. Identity:

Look for keywords presented in the online profiles of your contacts: What do you have in common? Friends, schools, ex-employers, affiliations, history?

2. Complementary skills:

What does this person offer that relates to our abilities, knowledge and complementary experiences? What skills do we share?

3. Synergies:

To what extent do we have common projects that we might work on?
Can this other person s ideas challenge my own thinking and give me the energy to succeed in new ways? Do the sum of our abilities, knowledge and experiences assemble like this: 1+1 = 3?

4. Leverage:

Can we accelerate our growth and wealth by working together with a minimum of extra effort?

5. Resonance:

Also known as “chemistry”, "click", "vibe" between people. To what extent do our values, history, beliefs, passions, purposes and energy resound in the same frequency and move in the same direction?

All of those points are important, but in the opinion of the author, the key is resonance. Resonance is music, love, passion, one's own mission and purpose in life. That is fundamental to the construction of confidence between partners.

Sometimes you may already feel that you do not like someone, but you don't know the why? Is it the absence of resonance? At other times, you feel that the song is pleasant in the beginning, but after some time something changes and you discover that your basic ideals are not aligned as you expected.

That can happen even with long term friends who have been very close in the past. To the degree that we are conscious of that fact, it may be better terminate that relationship. Sometimes, if the relationship is really important for the organization, it is best to appoint another person for manage that partnership.

draft by Octavio Pitaluga 6/22/07

quinta-feira, 13 de setembro de 2007

1.8. Categories of tools

A) Discussion Forums – Lists

Discussion Forums are virtual spaces that allow groups of people to converse on topics of their choice. Forums rely on the presence of a moderator who is usually the person who established and therefore “owns” the group. The forum owner decides the purpose of the group and invites other people to join in the discussion.

Popular places for these forums are Yahoo, Google and MSN? Many Universities and non-government organisations also host forums. They permit the creation of groups or communities, closed or open to the public, according to the choice of the owner. Lists or forums are basic tools and with few of the functionality of social networking sites. Generally they offer a discussion forum with options for surveys, databases and opportunity to post interesting articles or publications for the other members interest.

No Profile:

In groups like this, little may be known about who else is in the group. People may only be identified by email without a more complete identification, even a real name. That factor limits tremendously the interaction between the partners. It may at first feel like speaking in a dark room without the ability to see the faces of the participants. Some groups allow users to fill in a profile, but very often these are not completed.


Forums tend to have specific objectives and to be confined to a topic area defined originally by the owner, but extended by the members as they make posts.

Interesting content:

Some forums excel by providing for everybody a solid bibliography about the subject in question. They function like a repository of knowledge and methodologies for the subject matter of the forum. The ability to search past posts by topic is a valuable feature, particularly because many well qualified specialists may be members and have stated their opinion freely for all those who choose to be interested.

Some of these groups may be described as “communities of practice”.

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B) Social Communities

Social Communities are intended primarily for sharing personal and family information with others – particularly with those defined as “friends”. You would expect few business contacts in that kind of environment. The more popular social networks in the present market are: Orkut, Gazzag, Clubão, Friendster, Tribe, Hi5, Multiply and MySpace. They tend to be rich in pictures, offering space to place photo albums, music and text.

On these sites we be able to get an idea of the lifestyle of that person and their more special moments, often with family members.

Reunion of old friends:

There are many existing communities that can be searched to re-discover a network of old friends. It is possible renew the contact with people who we have not maintained contact with for a long time.


Searching the networks of friends and the friends of friends, is a relatively easy way to find available persons for a new relationship. There are many sites that now specialize in matching people for dating and relationship development. For a fee someone will make a special effort to search the available profiles to suggest suitable matches.

On your personal page you reveal some aspects of your personality and your preferences.
Visitors to your profile can ask for direct contact or for more information.


There is a big potential for entertainment in these communities if they were developed more. For example, a partnership with financial institutions would permit the sale of events via your own platform with electronic payment.

Sleep Walking:

The administrators of many social networking platforms still do not understand the real value of a community of around 10 million people. It is possible to create value inside the community as the members recognize the opportunity. But some of the questions we have are still not answered by the market. Therefore, we see opportunity but the business model is still uncertain.

Absence of controls:

Unfortunately, all systems that are excessively open and without clear ethics, strongly communicated and without corresponding moderation tends to self destruct. Some communities that are sinning in this sense are destroying their value. We believe that a business network management team would be able to bring big results more quickly.

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C) Business Directories

Business Directories are a powerful tool that stores the self designed profiles of executives, entrepreneurs, investors and head-hunters. Like a "virtual yellow pages", a directory permits the people to be connected among themselves, but without facilitating the interaction between the members. (In contrast to Facebook, which is a social network where lots of effort is made th help people engage with each other.) At present, the main actors in that setting are LinkedIn, Spoke and ZeroDegrees. All are international tools.


LinkedIn is the present leader of this market, with more of 12 million users including 246.000 + Brazilians. However, the big majority of Brazilians are still asleep and havn't yet used LinkedIn to expand their business network. We see a big potential of better utilization of LinkedIn.

Upload of mail addresses:

We recommend that the user builds an email address book to include everybody they contact. We also recommend that you upload to LinkedIn the emails of all your known contacts and, even, some of those people who are still not known. The tool will compare email addresses, and indicate the presence of those people who are members of LinkedIn. That will facilitate sending invitations to people you know requesting direct contact. This is a great help in the expansion of your business network.

Expansion of your reach:

In the virtual world it's much easier to connect with professionals based elsewhere in the world. If you take the time to build your international network, there will be many hidden opportunities among those connections. You can builds routes to access the people of most interest. Occasionally, luck will reward us and we will discover that our partners in business close to us are already connected with new professionals with whom our future business growth depends.

Who knows who:

By searching the visible network of your connections, it is possible to uncover who knows who and request the contact on the basis of a reference. Between the Brazilians, that should the main method of encouraging acceptance of a contact via LinkedIn. Brazilians can help each other to grow their networks if we understand why that is important.

RH x Head-hunters:

Human Resources professionals still show a reluctant presence on these platforms. Head-hunters on the other hand are strongly represented and very active.

Jobs Finding:

In the majority of the successful cases head-hunters or employers have discovered talented new staff by searching the profiles of ordinary members. There is also a specialist are for job postings.

Capital Finance:

Internationally, we hear stories of people who have found investors through the LinkedIn platform.


The LinkedIn platform offers the opportunity to ask your network questions.

In a survey, LinkedIn members were asked, “What was the main decision criterion when connecting or rejecting an invitation from someone on LinkedIn.

The following graphic represents the opinion of 303 people, the majority based in the England. People were instructed to only choose ONE response.

Introduction by a person known to me 23%
I have have met that person previously22%
Have worked with or done business with before 14%

Polite and personalized introduction 26%
Number of contacts 9%
Number of testimonies 2%
We belong to the same organization 5%

In the experience of the author, there are some differences to the above data in practice. In the chart above 59% suggest that previous contact was important to making a decision to connect or not. [23% + 22% + 14% ] We tried to test that idea, and found it false.

This work produced the following data:

1. You can increase in the rate of acceptance of invitations by making the invitation personal, and by offering something useful to your new contact. In comparison with standard invitations acceptance rose 20% (90% versus 70%).

2. About 50% of the new contacts were kind enough to thank us for the contact and showed an interest in knowing more about the business we are in and were looking for win/win opportunities.

3. Some said they were impressed by the broad number of contacts and testimonies in our profiles.

4. Around 10% of the persons that rejected the invitation confirmed that they only connect in LinkedIn with people that they have personally met before, or to people who have been introduced by a person who they know well.


We conclude that despite the survey result above, most people are happy to connect to people they don't know .Despite of the importance of the prior personal contact and of the representations made by dependable persons, it looks like a polite invitation to connect which is personalized really does make a noticeable difference.

Understanding that simple fact improves your awareness of the value of a virtual connection with a person who has a profile on LinkedIn.

D) Business Communities

Online Business Communities are primarily meeting places for social activity first and business activity afterwards. The leaders in the present market are:Xing, successBC, Soflow and Ryze. In Brazil, we have the [ Community Defeat and the Club of the Salesperson.]

Complementary to Business Directories:

To some extent we be able to map the same contacts via the business directories and in business communities. We will find that the way we interact with the members of various communities is colored by the sort of leadership and discussion being offered in those communities.

Complete Profile:

Each member writes his or her own professional profile. These profiles can be very long and detailed, making it possible to have a very complete professional background that can be searched by a search engine. This should make you findable.

Readable Profile:

Making a personal profile readable is a different problem. Someone reading your profile wants to know in a few sentences in plain language why they should pay attention to you. But they don't want to read 10 or more pages of detail. Offer a short, succinct, and readable summary.

Permission to contact:

The ability to contact people is always permission based. If you request contact with someone they have every right to refuse your approach. To avoid annoying people we should only make invitations to people where we have researched who they are and there is some win/win potential in the contact that you can make clear.


People who make references can be freely searched within the network. You can map who the contacts are and who made professional testimonials about the person of interest. You might also find that the people who made those testimonials have credibility, or as is too often the case that they are clear “jack-ups”.

Forums and blogs:

There are thousands of forums for discussion of the topics which interest you. You may also choose to maintain a blog in which you can sustain a detailed dialog on topics that interest you. Both these tools allow you to reinforce who you are and what concerns you. They also permit the community to know and recognize the unique professional qualities of each active member.


You may create clubs or groups based on topics of interest and recruit other people who are interested in online debates


When you organize an event in the real world, both offline and online contacts can be invited. As you invite the existing people in your day to day world, you can also invite them to join you online network. You can invite that part of your online network that lives in your region, and you can reach out into the local online world and invite people you know about but have still not met.

White Label:

Some organizations are acquiring “white label” rights on social network platforms. They choose to market themselves as a distinctly separate “brand”. The "white label" owner develops a clone of the main platform with distinct branding and features creating a community that is closed or semi-closed. The biggest objective is to make available exclusive private spaces for ones client or business partner and to promote clear communication options.

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E) Management of Contacts

Contact Management can be enhanced with free software from the Internet on the computer.

This can be integrated with your email programme permitting and facilitating the management of a broad base of contacts. The Plaxo is positioned as the leader in that market. More recently we have the launch of UNIK. We believe that tools of [and-CRM ] also facilitate the management of the contacts. We have experience with the ICS Online in that. · ????

Virtual Business Cards:

Your email system allows you to create a virtual business card. This permits the easy exchange of business cards and/or personal information with other people

Updating of facts with automatic notification:

When you make changes to you Plaxo address or information the service asks you if you want to notify all your contacts. If it's only a minor change, that's un-necessary. If you ask for you contacts to be notified the updating of the record of your changes,will be automatically be notified to all your contacts.

Signature in email:

You can pre-programme a signature in HTML to appear on you email. that can be modified to any moment through the bar installed in the email programme.

Birthday Cards:

You don't need to remember the birthday of the people you are connected to, the software allows birthday card sending since most the contacts have mentioned the date of their birthday in their personal information.


[by an anualidade modest, is possible to sincronização of the platform online with devices furniture and periodic updating of based on facts. ]

Corporate solutions:

There is still no dominant actor in this market.

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F) Communicators

Instant Communicators are free software (freeware) that can be downloaded from the Internet but, they require that another user to possess the same product for communication to occur. How much broadband capacity you have affects the quality of the communication. It is possible to open free international and long distance connections since in the communication is between computers.

IMs (Instant Messengers) : MSN, Yahoo, AIM, ICQ:

Functionalities offered include text chat, audio and some video with use of webcams.

Telephone technology VOIP: Skype, Google Talk, VOIP Cheap, Gismo and Ligme:
An alternative, to using Skype, is a telephone using an internet telephone of modest value.

Skype permits the communication between four users in the maximum prior agreement via a chat:window. [ something as hit the door virtually before of do the phone call. ]

Tools for Collaboration:

Unyte is coupled to Skype and permits remote collaboration with up to four persons [ without that for that the need of sending exist of the file in question.] The host opens Skype, Unyte and [ file it to be shared.] Through the chat window on Skype, after selection of the contact, the host sends a link. Upon clicking in the link, the Skype "client" will open a browser across than which will be able to see the file (s) in question. Skype offers you complete control over who can participate

Virtual/webconference Rooms:

These offer some more powerful as multiple functionalities webcams bigger security, unlimited number of users, privacy of application already integrated, white chart, survey, private conversation, engraving of the session and of the audio between other. Still without a leader of market despite of the diverse offerings

draft by Octavio Pitaluga net weight 6/22/07

quarta-feira, 5 de setembro de 2007

1.3. Formula for Wealth

Wealth = Value x Leverage

As in any multiplication, the factor values that we insert on either side of the multiplier alter the final result. It is common for companies and professionals to claim development success by changing one factor in the equation. They tend to forget to work on the other factor at the same time.

As consequence, business development activities seldom achieve their full potential. We understand that the richest countries are more easily able to achieve wealth objectives. To the extent that the value factor is increased and also maximizes the factor of leverage, the generation of wealth is a natural consequence. The commercial partners sharing the same culture possess a stronger identification with the business. This solid confidence within the partnership permits more business be concluded more quickly. Specially sophisticated and tempting is the new opportunity to increase the existing value shared between the partners in online business networks. Where more value can be created there will be bigger profits and benefits for all of the partners involved, and more wealth generated.

Value can be expressed in diverse ways. These are some of the main concepts:

1. Leadership: There is a clear crisis of leadership across the entire world. Leaders are needed everywhere in the world, but few professionals are really prepared for the challenges of a leadership position. However, we see the germination of new models of leadership. Among these are, the visionary leader and the leadership coach both of which are helping to produce better leadership.

The visionary leader inspires and motivates his team [to itself pawn to the maximum one in the reach of the goals in the measure in that each member of the same one understands clearly the benefits offered to everybody. ]???

The leader coach is that serves to his team and the team for the inherent challenge to everybody.

Both of these leaders work for each other in the first place and believe firmly that positive results will be a natural consequence of that work. [ Of ours breaks,] we glimpse the presence of the CNO – Chief Networking Officer – that manages not only a personal business network but is also the network agent for building on the existing relationships of all of the partners inside the network (internal and external).

2. Time: "Time is money" is a maxim in business. The majority of wealthy persons are more efficient in the management of time and the investment of their time than those who have still not achieved such wealth. When we respect the time and the terms established with the members of the network, we add value to the network. We shouldn't shift the burden that is fairly ours, onto other people.

3. Respect: All the times when a company or professional disregards a client or commercial partner, a real loss of value in the partnership occurs. The reputation of the company and/or name of the professional can lose value very quickly. That can be measured by the loss of market share or even of professional status depending on the judgment of the competent authority and superiors in the corporate hierarchy. Sometimes, it is possible to reestablish confidence and good will towards the future with a change of personnel. Unfortunately, often, the mischief is so deep that the change is irreparable. Normally, our competition thanks us for those mistakes.

4. Knowledge: In the information society that we have become, knowledge is put to work. Yet, people choose to ignore established facts, in favor of political or religious prejudices, despite the unfavorable results. Sometimes the most capable persons technical skills are disregarded for personal, racial, religious and/or political reasons. There are numerous cases where highly qualified professionals, especially those who qualified overseas, who cannot find a niche to do work compatible with his /her expertise in the domestic market? Meanwhile, India is the country with the greatest number of professionals holding doctorates in the world. The Chinese are growing the number of professionals with international qualifications at an astounding speed. These societies understand the value of professionals with first class knowledge. Sustainable economic growth depends on the development of intellectual capital, and first class scholars are indispensable agents of that change.

As a country, Brazil must learn to value fairly the professionals who possess a level of advanced knowledge and allow them to use and develop and transfer their knowledge, thus becoming agents of change and enrichment in the community.

5. Creativity: Brazilian people are among the most creative peoples of the world. We are even envied and respected for this natural ability so clearly expressed in soccer, music, dances, fashion and all forms of art. However, we still do not translate that creativity into commercial activity that plays strongly in the world of international commerce. With the exception of the traditional mineral and agricultural commodities, usually, the international buyers uncover our "diamonds" to be resold internationally at a much bigger value than the price [ I pay by the even. ] The first stage in the trial of internationalization, we should be able to use of our creativity to negotiate and establish long term partnerships with channels of distribution to world markets.

6. Commitment: Commitment can be defined as an agreement to achieve a time bound goal to work within the agreement to both exercise right and to share rewards that clearly were discussed and defined in the beginning. Any loss of commitment brings harmful consequences. [Obviously that how much bigger will go the purpose of the break, worse will be the worthy loss. Therefore, all the commitment I assume should be fulfilled or quickly renegotiated case the basic premises for the even suffer deep modifications altering of excessively the equilibrium formerly established. ]

7. Ethics: We all remember the cases of Andersen, Enron and MCI WorldCom to only cite some of the most recent financial scandals of the modern western world? The first two were off the business map in a matter of months whereas to last survives as a shadow of the firm that previously existed. These cases, verify a sad black zone of business behavior, a breakdown of business ethics and morality. The most sacred code of corporate identity, trust, was destroyed. And with loss of trust, all the value of the corporation evaporated.

8. Confidence: Confidence is the cement that builds partnerships inside business networks. Without it, no relationship is strong enough to maintain itself in the long term. The more confidence, the shorter the business cycle is. The larger is the flow, frequency and purpose of the activity. When we do business with this partner, that confidence is able to make its mark on both products and service?

9. Boldness: Highly talented persons and companies with big potential do not always possess, the necessary boldness for challenges outside their comfort zone. They fail to assume new risks and expand theie activity [ Not always the more well it prepared defeats.] Usually, the winner is the most daring one, who will fight for victory with more determination.

10. Attitude: Remember the metaphor of the half of the full or empty cup? Which of those is your natural attitude when faced with challenges? There are diverse attitudes that one might choose. When faced with new situations and dilemmas: aggressive or conciliatory, passive or active, etc... or any combination of them. [In a thing we be able to wake up, the winning attitude without that for that be necessary the elimination of too members is to that really aggregates value the society. We go her then.]

Those are some of the intangible values that cannot be dissociated from business. They are the most valuable property that an organization can have. It is practically impossible to measure them, but they are essential elements for the prosperity and survival of the organization

The good news is that these intangibles can be changed although they cannot be bought. A good process of awareness and corporate education is necessary here. It is necessary that all members of the organization understand the ideal and the higher level thinking required for success. Some companies erroneously believe that moderately good product/service, price, local and promotion. [ 1 and., the 4, 5] or that the 8Ps of the Marketing are sufficient for assure to its competitiveness. [ Ledo I mislead. ] Of that ahead a product of quality itself the commitment is not fulfilled? If the partner is disregarded by the team of service powders-sell soon after adhesion? ] Obviously that those points are absolute conditions for be in the business and that the same also add value in the scale, but we should not forget that that which is easily copied or duplicated on a global scale today. However, the intangible values are the main spring for differentiation between the leading companies in the market.

Leverage can be represented by many strengths:

1. Stable Team: A team of professionals with complementary skills and mutually motivated to reach a goal. It is necessary that there is equilibrium and harmony inside the team. All business of success begins with the stable, certain team, focused on the business and motivated by the shared vision of the objective. The composition of the team is one of the first and more important factors it will be analyzed by the investors.

2. Business Contacts: A business network is extremely valuable in developing advanced training in the process of business. His purpose depends on the entity in itself be she a professional in search of better placement in the labor market, evolving for an enterprising one in the seeks by its ideal team, passing for not making an effort to sell our products by electronic means. Business that are expanding its activities in other cities inside and outside your own country.

3. Technology: Every business should have a minimum and, preferably, a good technology based tools for the management and acceleration of the business. We stand out for not processing many electronic transactions. We fail to do enough at a local level that permits that the clients acquire our products somewhere of the world while we sleep.

4. Franchises: A franchise is by definition an agreement in which the franchiser holds the trademark, the experience and the model of the business. The franchiser coaches and qualifies his franchisees to operate inside a methodology that has already demonstrated it's success. The franchisee helps the franchiser to multiply his geographical presence and pays a fee to use the franchisers valuable resources like time, knowledge, experience and energy. Obviously in this agreement both the franchiser and the franchisee benefit. An agreement pre-established between the partners in the last analysis permits the franchiser to continue the expansion of his own business.

5. Global Business: Businesses developed with a global vision have a bigger capacity for expansion than business with purely regional focus. Brazil can only participate effectively in globalization to the extent that our companies have a clear plan for internationalization conceived from the outset. It is fundamental that we have a team of qualified and experienced people to face that challenge. It begins with the founders

6. Mobility: We might define mobility as the capacity to open or close a business in any locality at any time. The more movable, more agile, more responsive and adaptable to the constant changes of the market, and modern society the better will be the chances of survive and prosper in business. [ Equip] furniture, flexible and using of powerful technological tools make an unequal difference in a global competition. The combination of those factors generates confidence that the business will perform and that wealth can be created. We can expect that an economy based on abilities to outweigh economies of scale.

We are speaking much more of interpersonal abilities (soft skills) than of technical abilities (hard skills). The good news is that these interpersonal abilities can be developed through a methodology of solid work [ since have the compromise on the part of the employers with the goals to be achieved. ] Therefore, before any Brazilian company engages in business internationally, it is necessary to align the formula of wealth with the expectation of our richer cousins. Then, we will be literally "speaking the same language" independently of the language used in the dialog in question.

1.4. Win/win

1.4. To Form a balanced partnership and by negotiating a win/win deal.

In business network management it is fundamental to establish a win/win relationship with your partners. This alone will create the balance and indispensable harmony for a useful partnership in the long term. The definition of profits and/or benefits should be carefully negotiated and defined between the parters. Occasionally, over time there is a need to revise the agreement. will exist of the profits in the measure in the the setting goes altering. It's self evident that to always maintain the good will in the agreement we should seek a fair distribution of profits in the perception of both partners.

Each partnership should create a concept win/win. When one party is earning much more than another, we have only two options:

(A) equilibrium should be achieved soon or

(b) the relationship will chill and, occasionally, it will break down at some time, what will play for land all the previous effort.

It is always prudent to value and respect properly all the successes of the organization. It's worth remembering that a partnership always exists for the exchange of knowledge between the partners. That same knowledge can favor the competitors once it is available in the market.

draft by Octavio Pitaluga net weight 6/22/07

quarta-feira, 29 de agosto de 2007

Network Formulas

1.2. The Network of John x Network of Mary

Simple Formula of Networking: My Net X Your Net

Bob Metcalfe, inventor of the Ethernet, is known for pointing out that the total value of a communications network grows with the square of the number of devices or people it connects. (Metcalfe's square law ) This rule applied to telephone companies as they extended the number of subscribers to the telephone network, and now applies to the Internet in the same way. The global interconnection of networks we call the Internet has created huge and increasing value to all its participants.

The mean number of connections on LinkedIn is 5.

Three people with five connections make a network of 125 possible pathways.

5 x 5 x 5 = 125 (Metcalfe's Law)

David Read has identified another factor, the ability of people to choose the groups they belong to, and that people with similar interests will choose join similar groups. Read's Law applies to group forming behaviors in some networks. A group forming network has functionality that directly enables and supports affiliations (such as interest groups, clubs, meetings, communities) among subsets of its customers. Group tools and technologies (also called community tools) such as user-defined mailing lists, chat rooms, discussion groups, buddy lists, team rooms, trading rooms, user groups, market makers, and auction hosts, allow small or large groups of network users to coalesce and to organize their communications around a common interest, issue, or goal.

5 x 5 x 5 = 125+ a group forming value multiplier (Read's Law)

When we establish personal and professional relationships in LinkedIn, we are in the reality establishing a relationship between our network of contacts and the network of contacts of the potential partner. Obviously how well that network will be used will depend on factors such as the establishment of confidence, frequency of communication, experience of useful outcomes and cases of successful collaboration between the partners.

The relationship is not limited barely to that person specifically. The connection is much broader. Linking not only the individuals, but also the groups those individuals have joined, making the flow of information through the network possible.

The size of the group forming value multiplier depends quality, duration, confidence and reputation of members, and this value is consolidated through diverse experience of useful collaboration between the members.

Depending on the interests and needs of group members, is possible to discuss experiences with a newcomer and accelerate the relationship with that person since we already share group membership. Membership has expectation and responsibilities attached. To some extent these “rules” are made explicit by written statements, but far more powerful is the unwritten social expectation that all group members will offer support for each other. This is usually defined as being helpful to others where you can and “paying forward” meaning that you offer help not expecting anything in return, but believing that what goes around comes around. If you create positive results for others that effect will be experienced by those directly involved, that connection will be strengthened and the whole network will enhanced.

Using the force, quality and experience of that connectivity, we be able to mutually work like a catalyst or an accelerator of business inside ours respective networks. It is so important to understand the existence of the wider network behind each simple contact.

The mean number of connections on LinkedIn is 5.
If each person here had only 30 connections that would build a much bigger and stronger network. Consider the following networks of 5 people each with only 5 unique connections using Metcalfe's Law.
5 x 5 x 5 x 5 x 5 = 3125 potential pathways

If we have one very well connected person with 3000 unique connections we get:
5 x 5 x 5 x 5 x 3000 = 1,875,000 potential pathways

But if we have 5 people with 30 unique connections we get:
30 x 30 x 30 x 30 x 30 = 24,300,000 potential pathways

Notice that we have unique connections in this example. The more your network has connections that are not common to other people in the network the more value you bring to the system. So we have three principles to consider. Metcalfe's Law, the raw number of unique connections. Read's Law the quality of the connections is improved by group forming choices. Finally the way people choose to engage in the network, their willingness to pay it forward, and their willingness to develop new relationships.

Small World Theory

In fiction Hungarian writer Frigyes Karinthy (1929) and playwrite John Guare (1992) have suggested that the essential linkages between you and any other person in the world is a small number rather than a large one. Six degrees of separation is suggested. There have been attempts to build a mathematical and experimental proof of this idea, notably by American sociologist Stanley Milgram in 1967 and recently (2001) using email by Duncan Watts at Columbia University. There is quite a lot of evidence supporting the idea that the number of connections is indeed a small number like 5 or 7 and not a big number like 50 or 100.

If you have built your online connections in social networks like LinkedIn you extend your ability to quickly reach people you may need in the future. LinkedIn allows you to “reach” people within three degrees of yourself. The numbers below illustrate how the number of connections you have extends your total reach across the LinkedIn network.

5 Connections

First degree = 5 Second Degree = 248 Third Degree = 18904

30 Connections

First degree = 30 Second Degree = 1846 Third Degree = 180,908

100 Connections

First degree = 100 Second Degree = 34141 Third Degree = 3,332,000

Conclusion: Each of us can be connected many new people by online networks. We will be capable of reaching a significant population in many cities of the world. Because of the group forming behavior that occurs in these groups, if you are an established member, the people you most need to contact are quite likely already positioned within your reach.

Original by Octavio Pitaluga edited in English by John Veitch

The Importance of the Business Network Management

1.   The Importance of Business Network Management

Basic beginnings

In the vision of the author, four basic beginnings in the Business Network Management exist:

  • Expansion of your own Business Network

  • Network of John x Network of Mary

  • Formula for Wealth

  • Paying Forward

1.1. Expansion of the Business Network

By definition, all professionals, government, business and non-profit organizations in the same country belong to the Business Network. That's true whether or not the leadership is working with that understanding and applying the principles of networking or not.

All of the necessary resources for developing your business are within your reach inside the Business Network. If the business goals cannot not be reached, it is because the organization could not map to the network sufficiently. It's necessary to established an efficient and clear communication in which the relationships can develop and where the principle of paying forwards is understood and honored between the participants.

In a growing globalized economy such as this one, it makes sense to establish global connections, reaching out in a random way following the principle that from a larger number of connections many valuable people with expertise or business knowledge will be discovered.

We see ten good reasons for expand your network randomly:

  1. New job: We never know when we will need quick help for find another position in the market. It is likely that the opportunity we seek is waiting inside our existing network.

  2. Geographical Expansion of the business: The company will need competent and dependable persons to enable the growth of the business.

  3. Building teams: Where do we find those persons? How do we attract, retain and motivate our people?

  4. For new undertakings, partners, investors: who are the best qualified persons to help with my kind of business?

  5. A route can signify no route: On several occasions, if I had only a single route to someone I can't be sure that I can reach person I'm seeking. My access to that individual is blocked unless those who can link me to that person decide to act like catalysts and open the way. This may be so even if the reason for contact is advantageous to both parties.

  6. Geographical Change: Professionals today have a tendency to relocate more and more as careers develop. It is better to know someone in the neighborhood you are moving into, someone who can guide you around.

  7. Careers and unfortunate relationships: There exist moments when we need a general change in our lives. Who will bear us and will encourage us into a direction that offers a better future? We should be able to find emotional support in our network.

  8. Friends of friends: Remember, the simple connection to anyone is not as important as the extended connection with the friends of his friends.

  9. Future Generations: The connections we develop create a database for our own family to use. If they choose, they can begin to link between our contacts and their friends and reach out to the sons and daughters of those people. They will be able to build on our example and develop a lot business connections more easily and develop those over a longer period.

  10. New friends: Perhaps someone will appear in your network who shares a special understanding with you. One of the things we find most helpful is to share with people who are “like us”.

Original by Octavio Pitaluga edited in English by John Veitch