Referral networking and Dunbar’s number

Six degrees of separation.
Image via Wikipedia

I have been thinking more about the networking butterflies and why I believe there is a need to concentrate on just a couple or so referral groups. We know that it is important to see our network contacts, who are of course people, on a regular basis. It is only because we see them often enough that we can be comfortable with them and trust them with our reputation when we refer them.

I think we can only have so many people in our trusted social networking community and beyond that we may have contacts we could suggest and but probably not have the certainty to recommend. Our close referral group is probably restricted to Dunbar’s number. Robin Dunbar, who came up with this number is a British Anthropologist and Wikipedia explains “Dunbar’s number is a theoretical cognitive limit to the number of people with whom one can maintain stable social relationships. These are relationships in which an individual knows who each person is, and how each person relates to every other person”. It is best you read the Wiki article, but many of you will have come across this theory before. The number is 148, rounded up to 150 and I can buy into that.

I don’t think we need to get confused with having large numbers of contacts on-line. Thomas Power, chairman of Ecademy, believes we should have as many as we can. That does of course give rise to the “you never know” factor based on the theory that we all have only six degrees of separation from anyone else on the planet. I don’t really buy that one, but we can get lucky, and it allows the random possibility which recently found me a client in Australia via Twitter, from where I am certainly separated by a considerable distance. Thomas has an exceptional memory for people, has met more than nearly all of us, and the random process gives rise to great connections. However, my more modest but large number of network connections would not allow me to recommend without checking the provenance of any offer and ability of any person or company to deliver.

So, back to off-line referral networking, and into my special area which is breakfast networking. I am not comfortable in trusting and recommending huge numbers of people because I am still rooted in the tribe or village size of about 150. Furthermore, in any village there are going to be a few villagers we are not so keen on and don’t like to be with. Of course, some people leave our network village, and some join, but if I go to too many networking communities I feel I will get confused as to who to refer to whom.

What do you think?

© Jon Stow 2010

Related post: Networking, hunting and butterflies

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Value Billing v Distress Billing

If I am going to compare value billing to what I mean by distress billing, I suppose I should define the first and tell you about the second.

Value billing is charging a client based on the value of the information or service provided rather than invoicing based on time spent. So, if a negotiator gets a client a deal which saves that client a million dollars, it might be seen as reasonable to charge $50,000 because of the huge value of the deal to the client, even if the work of the negotiator only amounted to a couple of days work. After all, the client is happy to pay for something very valuable which she could not have done herself. Happy client, happy negotiator.

I define distress billing as a charge made to a desperate client which takes advantage of the client and leaves him feeling ripped off; indeed knowing he has been. One example might be an emergency call to a plumber in the middle of the night to stop a leak causing further damage. In the daytime, a fair charge in the UK might be £100 for an hour’s work and the stress relief. At night, it might seem reasonable out of hours to be charged £200 to £250 for the inconvenience of the call out. A distress-billing plumber might however get the customer to agree to £500 to £750 for the hours work because “you won’t get anyone else out at this hour mate” as the customer imagines the entire house being destroyed by the flood. Effectively the fee is being blackmailed out of the customer. The customer will feel very unhappy later on.

However, this piece is not about plumbers and if you are a plumber whose sensibilities have been ruffled, I apologise.

A few weeks ago one of our cats was taken very ill. We took the cat during normal working hours to our veterinary surgery which is now part of a chain. They pronounced the cat to be in critical condition, of which there was no doubt, and prescribed various blood tests to detect organ problems and for a viral infection. Of course my wife and I agreed, in our distressed state, and the tests were done. The results were very bad and the outcome for our cat was, alas, that it was his last trip to the vet. We paid the bill, which was enormous, and went home shattered.

Because of the virus diagnosis we needed to get the other cats the same tests to see if they were infected. We had started to smart at the bill, having recovered our wits, and telephoned other vets for some quotes. It turned out that we had been charged double the going rate for our sick cat’s tests. Of course at the time we would have been prepared to agree to almost anything. You cannot say this was value billing; it was taking advantage of our distress. Anyway, there was no value in paying a large bill in advance of losing our cat especially as the outcome was poor anyway.

It is unlikely we will return to the vet practice we have been going to for so long. There appears to have been a detachment from the caring vet practice as far as the animals are concerned and the morality of over-charging or blackmailing of their owners. This is not a way to run a professional practice.

What do you think?

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Special offers to be taken with a pinch of salt

Obverse of the Series 2006 $20 bill
Image via Wikipedia

Do you receive at least daily loads of emails offering you the secret of how to make vast amounts of money a day for working only four hours a week? Do you get telephone calls from overseas suggesting you invest in some penny stock that is about to make it big? Are you sometimes approached by quite good business friends with the offer of some wonderful moneymaking scheme they have heard about and are gullible enough to try to rope others into?

These are all penalties of being in business and having a web presence. We give the world opportunities to contact us, but we are in business and cannot filter out the chancers except the serial spammers.

Now, I don’t doubt that some of the tales that are woven have some basis in truth. An experienced day trader may make a lot of money in four hours though it won’t be without investing a lot of time in watching the markets even when not dealing. There is a risk of losing of course, but that is just glossed over in the sales patter.

The penny stock offers are known as “boiler-room scams”. I don’t know about boiler-room, but most of these people sound as though they are calling from the bottom of a well or a Chilean mine, no doubt due to roundabout routing of their calls to avoid being traced.

The other week I had occasion to examine an apparent way of saving large amounts of tax. In this case there was an outside chance it could work before the tax authorities leaped on it, but it would have required a very bullish taxpayer to try it and you could bet your bottom dollar that the offshore providers would have disappeared long before the angry taxpayer turned on them.

The truth is that all these “opportunities” pander to the greed of those drawn in. There will always be money and probably quite a lot of it to be paid up front. That is money which most likely will never be seen again.

Take care out there, and remember that if something sounds too good to be true…

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Don’t repeat costly business mistakes

Mistakes. We all make them. In the early years of a business, inexperience may lead us to make quite a few. Don’t worry about that. It is important to learn from mistakes and move on.

Starting out we are going to be telephoned by the business directories such as Yellow Pages and Thomson. If we have a plumbing business or a car repair shop that may be just the way to get business in the early years before our good reputation gets to spread around. What we don’t need to do is persist with paying large amounts of money for directory listings which don’t work. A couple of years is quite enough and if there is no result, move on.

There are people who keep trying things in the hope that somehow things will change and something will start working. This reminds me of one of my colleagues who had once been my boss. He tried hard with his IT which was to his credit, but I remember over about a week he was trying to do something in Word 97 or with Windows 2000 and it didn’t work. Of course that was because he was making the same error over and over again. The software didn’t know what he was trying to do, so it just didn’t work. My colleague should have asked someone what he was doing wrong, but he was just too proud to until a staff member just happened to notice his predicament. Yes, it was comical, but demonstrated the need to get help, and how stubbornly some people resist asking for it.

We must not beat ourselves up over our mistakes. We must learn and move on and know when we need help, and the value of that for which we pay.

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Riding the wave

So if we move with the times, let’s enjoy ourselves. If you are reading this you probably know that I have quite a significant on-line presence. I cannot claim to be one of the big hitters like Chris Brogan or Guy Kawasaki or even one of the biggest in the county where I am based, but I do try hard. Of course I do that because I know that on-line marketing is absolutely vital, and that includes all the social media stuff, but to tell the truth I also do it because it is fun.

It is fun, isn’t it? We have to keep reading, absorbing, learning and trying every new thing. Some innovative ideas never really get of the ground (like Google Wave) but we give it a go and see what happens. Even the stuff that comes to naught keeps us sharp.

In the past year or so I have moved from just using the on-line websites and having a static website to being a serious blogger (because I like it and it works), to learning a lot about WordPress though I need to learn a lot more. I have tried many different platforms and some I like and some I don’t. We just need to understand what works for business and if that brings some fun, it is just great.

The on-line marketing has made business so much more exciting and for me so much less isolated, because with Twitter and the various forums we have so much worthwhile conversation. Do you think I am getting carried away? Well, I am riding the wave or one of them, and if I fall off there is another right behind.

It is all so exhilarating isn’t it, and all the better when the money comes in? What do you think?

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Move with the times!

I was writing the other day about the business directories not really delivering for many small businesses. One of the reason for that is that our customer and clients tend to look elsewhere for their services. Compared with even five years ago, so many more people search on-line for the stuff they want, whether it is for a chimney sweep (yes, we employ one) or for an EBay offering or for a courier service or an accountant. There is always the possibility that even the on-line searchers will go with a recommendation but we have to be alive to the need to be found on-line when someone looks.

We were talking about this at a breakfast meeting, when our resident SEO expert commented how the search engines change their game all the time and he has to be on top of it as far as possible. This then brought us on to the changes even with Twitter and two of us who subscribe to Jim Connolly’s Marketing Blog remembered Jim’s comment concerning the person who wrote a paperback about Twitter which was bound to be instantly out-of-date. Incidentally I recommend you subscribe to Jim’s blog which is excellent. He is a top marketer.

It is most important to keep up with what is going on now. Traditional sales and marketing in print was indeed traditional for two hundred years or more, but now we all need to think on our feet and indeed listen to the buzz of the internet. Otherwise the business world will leave us trailing behind, and that means all of us including the dress shop and the hardware store.

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On-line personas and future job seekers

Facebook logo
Image via Wikipedia

Most of us who run our own businesses and have an on-line presence are very much aware of the need to stay professional. This means that we are careful with our language at all times including when talking to each other on Twitter and Facebook. I do have some friends, especially on Facebook who are not in business on their own account, but employees and to be fair to them they are pretty sensible. However, I have noticed that some of their friends on Facebook, who are not my friends or connections, are much less careful. I see bad language and some pretty stupid comments.

I am not a prude. I have been round the block, been down the pub, and travelled all over the country supporting a well-known football team, so I have heard everything. None of this bothers me.

I just wonder what is going to happen when some of these whose careless remarks are there for all to see on Facebook are looking for a job. People talk to other people, and it doesn’t matter if privacy controls are very tight, word will get out. Also, imagine a person who is foul-mouthed on-line or even criticises their boss is asked by that boss to add them on Facebook. Either they do so to avoid embarrassment or they ignore the request, and the boss cannot understand why. There is going to be a difficulty.

It is important for those who wish to work until retirement that they realise that more than ever, walls have ears, and especially in the digital age. Be sure your sins will find you out. You can be more sure than ever that they will.

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Lasting impressions

I went to our local corner shop for some milk. The shop is what is known as a convenience store, but I don’t go there unless it is absolutely necessary because it is not generally a pleasant experience. Why? Because the owner-shopkeeper is such a sullen fellow.

On this occasion he ignored my “hello”, and when I took my purchase to the counter to pay he only told me how much I had to pay him, didn’t say “thank you”, looked annoyed when I asked for a receipt, and ignored my “goodbye”. I knew not to expect any conversation in between.

Going in that shop is not a pleasurable experience. How much would it cost to smile? I have never seen this guy smile in a couple of dozen visits over three or four years, but if I had seen a smile I would have been in the shop many more times; in other words if I had felt welcome. I can’t imagine I am the only person to be put off visiting the shop.

How much difference it makes to welcome a customer or client and make them feel valued. Even if we have had a rough day we should still make an effort to make our customers feel comfortable. Otherwise we won’t have so many and those we have won’t visit so often, because a bad attitude makes for a lasting impression.

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Loss of status issues for the newly self-employed

Signpost at the Cape of Good Hope

I remember well what it was like to find myself without a job, not able to get one and with the prospect of “getting on my bike” and earning a living as a self-employed person. I had not planned to be self-employed; it was a matter of survival, which I have discussed before.

In the corporate world of larger organizations we have the concept of status. We know our place, and we have worked hard to get there. I had various titles such as “Manager”, Senior Manager” and “Senior Consultant”. Once I thought these had some sort of cachet; I guess the main purpose was to define our roles, and so that we knew who to report to and others knew that they had to report to us. There are other reasons for titles of course. In the accountancy world, especially in larger partnerships, the title of “Director” is dished out to those who think they should be partners but haven’t been offered this status; it helps them feel better than being a senior manager but really doesn’t have any other meaning.

In the small business area titles are irrelevant to the clients and customers, and one has to get on with building a business. Just the same, if someone had been made redundant it takes a while to recover the self-esteem had when he or she had a designated title. It is bad enough feeling unwanted when made redundant, but not even knowing by what title to call yourself is very hard indeed.

Strangely, many people find it very hard to see themselves as the boss and in charge, and it may be a completely new experience. Of course being in charge has a lot of responsibility, not least in earning a crust to live on, but new business owners amongst those who have lost their jobs need to recognise the freedom they have to make their own decisions. It should be liberating and invigorating, and even if we make the wrong decisions sometimes at least we can change our minds. In the corporate world it can be very frustrating implementing someone else’s wrong decisions.

Running one’s own business can be so much more satisfying than being an employee in someone else’s business. We just have to throw away the conditioning and forget the grand titles we used to have. Just call yourself the Boss. Don’t you agree?

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