Small Firms Spark Growth When They Plug Into Business Networks Digital business networks introduce small firms to a universe of companies that otherwise wouldn't know they exist.
By Chakib Bouhdary •
Opinions expressed by Entrepreneur contributors are their own.
In today's hyper-connected, always-on economy, ecommerce isn't just a faster, more convenient way for consumers to get the things they need to manage their personal lives. It's fast becoming the de facto standard for businesses to secure the goods and services necessary to run their operations. Business networks are fueling this trend.
Social networks have made it easier than ever to drive conversations, gather intelligence and manage relationships. Business networks provide an equally easy way for companies to link and coordinate a virtual "extraprise' of partners into a shared community and execute key processes in a more informed and efficient way than in the past.
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Through business networks, companies can:
- Receive active leads from a global community of qualified buyers rather than simply tracking them.
- Manage orders and statuses in real time rather than chasing paper.
- Accelerate payments for goods and services and optimize cash by making early payments.
- Gain new community-based intelligence and insights to make better decisions.
That's just a handful of ways businesses can quickly realize value. Take cSubs, a woman-owned knowledge resource management provider whose business is helping companies procure, manage and analyze their subscriptions, books, memberships, software licenses and other knowledge resources. Nearly a decade ago, the company set up ecommerce operations primarily to meet the demands of its customers.
Leveraging a business network, cSubs created catalogs through which its customers could effectively manage the increasingly complex flow of content entering their organizations. Within two years, 25 percent of the company's business was coming from this new community channel.
Then cSubs took things to the next level and launched a solution that leverages the workflow capabilities of the network to provide customers with centralized control of electronic content tasks and analytics, including pricing, contracts, access rights, renewals, usage statistics, and terms and conditions. This has given the company a tremendous leg up in competing with much larger companies and a new revenue stream that has been a great growth driver.
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In their initial phase, business networks were all about connecting companies to more efficiently perform discreet processes such as buying, selling and invoicing. But companies are beginning to move beyond simply transacting on networks and tapping the insights and intelligence they provide to break down the barriers to collaboration and enable new processes that drive innovation and competitive advantage.
For instance, many small businesses have found that joining a business network has given them a leg up in competing with larger companies, which in turn drives growth and company expansion. Others are using business networks to implement capabilities that allow buyers to accelerate payments to them in return for a discount – an initiative that President Obama himself recently announced as critical for the small business sector and economic growth.
Before joining a network, cSubs had little visibility into whether invoices had been received or checks had been sent, when dealing with large companies. Being on a network has helped them close the loop, increasing visibility and confidence into when they will actually get paid.
Then, there is the unprecedented value businesses are seeing from data-driven insights that are gleaned from digital communities. Just as consumer networks like Facebook mine data to improve the experience for its users, business networks let companies mine data from suppliers and customer transactions to improve processes and ROI.
Business networks are taking lead generation to a whole new level, connecting suppliers with new buyers they wouldn't have otherwise had access to. They also enable enhanced customer retention by allowing more collaboration and better visibility into transactions.
A decade ago, there was serious debate about the viability of the Internet as a channel for business, or even a tool to power it. Today, it is clearly a driving force of innovation and growth. Leading enterprises are already on the bandwagon. And more will surely join. Yes, business has gone social. And there's no turning back.
