The changing face of business relationships

superfastbrit

1PKsyXF

The changing

face of business

relationships.


From networking to

net-working.

them. It’s hard to convey any emotion in it – unless I pepper

it with emoji or emoticons ;). Plus those rather strange

millennials (a.k.a. young people) existing amongst us think

email is “so last year”. Chat and social media is often where

it’s at with them. They may have a point.

Entrepreneurs

at ease with

connections.

Snapshot of a changing world.

The world is changing faster than it ever has. This

extraordinary pace of change is especially evident in the

way we do business.

“People buy from people” is something that is frequently

quoted at me. And yet the evidence is that we’re becoming

increasingly comfortable buying a lot of things from a

faceless online retailer who we never speak to and may not

even be located on the same continent.

As a psychologist,

I have to ask “why?”

Has our diet of Apple, Blackberry, Raspberry or other

selected fruit based technologies changed our business

appetites? Geography has, especially, become less relevant

as we are able to extend our trade networks from Bognor

to Boston and beyond and collaborate with anyone and

everyone in real time.

However, there is one sophisticated piece of technology

that hasn’t been updated recently – and that’s our brains.

Our inner caveman still dictates a lot of our behaviour. That’s

why, despite thousands of technologies out there that

will kill distance, we do often still default to face-to-face

meetings.

As we virtualise, there is a huge need to understand the

dynamics of collaboration better – especially since this

research suggests that less and less of us are meeting

in person, although we would like to. Email is often the

collaboration tool of choice in the digital space – even

though it is objectively an exceptionally bad collaboration

mechanism. For a start, email collaboration requires me to

know WHO I need to collaborate with before I can contact

When is email appropriate? When is it better to pick up the

phone? Does social networking really work and why is

face-to-face sometimes worth the effort?

All of these questions are things we need to understand,

and quantify, as our digital future beckons.

By understanding how we can collaborate better in both

the real and virtual world, we can move from “networking”

to “net-working” for future business success.

Dr Nicola Millard, Head of Customer Insight & Futures

BT Global Innovation Team.

Technology has been a key enabler in connecting startups

and growing businesses to each other, to suppliers,

and to potential customers in the UK and across the

globe.

This report shows entrepreneurs increasingly at ease

in making connections and doing business with people

they haven’t met (whilst still placing a high value on

face-to-face communication). It shows technology

has made the world a smaller and more connected

place, and one that makes the working life of the

self-employed so much easier. For instance, we can

see social media is being embraced for promotion,

cloud computing for key business functions and digital

marketplaces for international trade.

Each day I see modern small businesses growing

through outsourcing, and sub-contracting work to

partners and fellow professionals. They are building

profitable and nimble businesses, and realise the ability

to form and manage partnerships is a key factor in

commercial success. Powerful partnerships equals

profitable business has become a mantra in the world

of small business.

This report makes a significant contribution in

making the case for collaboration, connections and

partnerships. I’m sure it will be embraced and acted

upon by small businesses, from all types of sectors and

various stages of growth.

Emma Jones MBE,

Founder, Enterprise Nation.

When you’re caught in the middle of change, it’s sometimes

hard to understand what impact it’s having on you. But the

more you understand, the better you can adapt. And the

better you can exploit the new opportunities that change

throws your way.

That’s why we’ve commissioned a major new research

project by market research and strategy consultancy

Populus into exactly how our business relationships are

changing. This report is a summary of their findings.

The methodology.

WHO:

HOW:

Populus interviewed 1,001 senior

decision makers at businesses

with 0-500 employees. We chose

the interviewees carefully to

represent companies of different sizes

(0-9, 10-99, 100-249 and over 250

employees).

The interviews were conducted via an

online panel.

WHEN: The fieldwork took place between the

5th and 16th of June, 2015.

1


Collaboration is still the key, but the way we collaborate is changing.

Virtually normal.

We’ve always placed a high value on business relationships.

We know how critical they can be to our success.

That basic principle hasn’t changed. But what has changed

is the way we collaborate with our partners in business, be

they customers, colleagues or suppliers.

Nowadays the first connection between businesses is often

made virtually, through social media networks. And highly

effective business relationships can be maintained without

anyone ever meeting face-to-face. None of this could

have been possible without the internet, a technological

advance that has had a major impact on the way we work

together.

For all that, we believe that face-to-face communication

remains absolutely invaluable in the world of business.

But technology has the power to bring about exciting new

collaborations, to forge unexpected connections, and to

make great teamwork a possibility for every business, no

matter where the teams are based.

As this report shows, relationships are everything to

businesses. When you collaborate, you can never know

where it will take you. But you can be sure you’ll achieve

more than you could on your own. The challenge –

and the adventure - is to connect with others and see

what happens.

Business revolves around relationships. People connecting

with people. In the past, these connections have largely

been made face-to-face in real time.

Our research shows that the virtual business relationship is

now becoming increasingly the norm. We believe this will

become even more prevalent in the future, due to the fact

that younger business managers are far more likely to have

customers or clients that they have never met in person

compared to older managers.

What do we mean by a virtual business relationship? It’s

one where two or more people in business interact and deal

with each other mostly, if not exclusively, via technology.

97% of business managers aged 18-34

are more likely to accept contacts they have

never met in person, compared to

72% of managers

aged over 35.

This is a trend that’s set to grow as the next generation of

business managers takes over. These Generation Y business

managers (those born between 1980 and 1992) have

grown up as digital natives. They are more at ease with

forming and maintaining virtual business relationships

using social media and email. In contrast, their older

counterparts place a higher value on the power of

face-to-face meetings.

“You may not be checking your emails out of hours, but

with mobile apps and Facebook you are just constantly

connected to the client.”

Nick Telson, DesignMyNight.com

56% of businesses have

clients they’ve only ever

contacted by email.

82% of business managers aged 18-34 are more likely

to have customers or clients they have never met in person,

compared to 60% of managers aged over 35.

42% of businesses

communicate with

each other by email.

26% of people

use the phone on a

daily basis.

85% have suppliers or clients they haven’t met.

The main reasons they haven’t met a client or supplier.

62% of businesses have clients they’ve never met.

Geographical distance is given as one of the main reasons

for a lack of face-to-face contact. Look at it another way

and you could say that technology is enabling meaningful

and productive relationships to be forged, regardless of the

distances involved. You don’t have to be in the same room

to collaborate with someone any more. You don’t even have

to be on the same continent.

31%

say it’s because they are

based in a different country.

59%

say it’s because they are based

elsewhere in the country.

3

4


Face-to-face facts.

Even though virtual business relationships are booming,

face-to-face contact still has its place. Many senior

managers continue to value it highly, and say they prefer

it for communicating with both colleagues and people

outside their business.

29%

of managers say they prefer a face-to-face meeting

when they need to communicate with someone outside

their business about a specific project or work situation.

Fewer than 50%

of interactions with

their colleagues is

face-to-face.

Only 13%

use face-to-face meetings

as the most common way

of communicating.

There are some things that are best done face-to-face, but

it may not always be possible for business people to meet

in person. As people get more comfortable interacting

virtually, we predict that this will become less of an issue.

Certainly, evidence suggests that the next generation

of business managers will use technology such as video

conferencing as a substitute for face-to-face meetings,

using technology to maintain a personal connection with

their business partners.

We’ve also found that younger managers are already willing

to invest a similar level of trust in remote relationships, as

their older colleagues invest in face-to-face meetings.

56%

of business

managers aged

18-34 have

used video

conferencing,

compared to 30%

of managers aged

over 35.

30%

Performing under pressure.

Today’s business environment is highly complex and

demanding, placing incredible pressures on business people

to perform. Somehow we need to find a way to equip

ourselves with a wider set of skills than ever before.

One way of meeting these demands is to embrace

collaboration and partnership as a way of working. Our

research shows people in business are increasingly relying

on partnerships with other businesses to help them meet

this demand. It will be interesting to see whether this trend

continues. Given that younger managers are just as likely

as older managers to believe in the benefits of partnership,

we predict that it will.

81% of businesses say

that to succeed in business

today you need a wider

range of skills than ever

before.

82% of businesses have had to seek

help from another business when

attempting a new or unfamiliar

task at work.

Teams don’t necessarily need to have all the expertise

in-house, provided they know how to access it quickly.

Our research shows that reciprocal arrangements where

knowledge is shared equally can lead to benefits and

opportunities for everyone involved.

By connecting people with people, we can create a free

flow of ideas and more fluid, agile working practices. We

can even beat deadlines by connecting with collaborators

in a different time zone on the other side of the world.

Typically, a business will work

with other companies.

30

42% of businesses say

they need help from other

businesses to fill skills gaps.

“Phone calls and emails are fantastic for work but you

tend to treat them quite formally…when meeting

face-to-face, you’ll ask that same list of questions but

also build a relationship with that person.”

Adam Sopher, Joe & Seph’s

“Meeting a client face-to-face shows a sense of

commitment from both sides, and adds value to

the relationship.”

Mark Spoors, Esportif International

37% of businesses

are working with more

businesses than five

years ago.

Why businesses agree to partnerships

76% helping them succeed

33% gaining new business

opportunities

21% extending their

services and capabilities

17% sharing knowledge.

5

6


The power of networking.

‘Networking’ used to be just a buzzword. Now it’s the

cornerstone of how we all do business. Companies

use networking to get new business leads, to recruit

colleagues, to source suppliers, to share knowledge and to

influence potential advocates.

71%

of new business leads still

come from existing customers

and clients,

It’s still true that the majority of new clients and suppliers

are met through existing clients and suppliers. However,

smart businesses actively use networking as a way of

extending their reach and growing their business.

We predict that networking will become more and more

important in the world of business. That’s because a greater

proportion of younger business managers are turning to

networking events to secure new business partnerships.

38%

through mutual friends

and

31%

from attending

networking events.

A look at LinkedIn.

LinkedIn describes itself as ‘the world's largest professional

network with 300 million members in over 200 countries

and territories around the globe’.

Most senior managers who are on LinkedIn get a lot out

of the site. They see it as a great way to make new and

rewarding contacts.

Any risk involved in accepting and offering invitations to

connect with ‘strangers’ is far outweighed by the perceived

benefit – the chance to grasp a new business opportunity.

Today’s stranger may be tomorrow’s client, or even business

partner.

As we’ve seen, this trust in remote relationships is

becoming the new norm. Most senior managers on

LinkedIn are more than happy to accept connection

invitations from people they‘ve had no prior contact with.

A significant proportion claim that connecting on LinkedIn

has already led to new business opportunities.

The way managers use LinkedIn reveals a real generation

gap. The more digitally connected younger business

managers are far more likely to use sites like LinkedIn than

their older peers. We see this as a strong indication of what’s

to come. If the current behaviour of younger business

managers continues into the future, we expect more and

more business relationships to grow online.

73% have accepted a LinkedIn request from someone

they have never met.

54% have accepted a LinkedIn request from someone

they have never had any contact with at all.

39% say it has led to new business opportunities.

57%

of business managers aged 18-

34 meet potential new clients

through networking events,

compared to 29% of

managers aged over 35.

24%

of businesses find

potential new clients

in the virtual space via

online networking sites.

54%

of senior managers are on

LinkedIn.

Average number of LinkedIn

contacts is

243.

45% of business managers

aged 18-34 use sites like

LinkedIn, compared to

The reasons people

accept requests from

those they don’t know.

62% say it’s because

they see it as a new business

opportunity.

Networking events are especially

popular with larger companies, as over

50%

of business with more than 50 employees

use networking events to meet potential

clients or suppliers.

22%

of managers aged over 35.

57% say it’s because

they have a shared

contact.

70% say it’s because

they work in the same

industry.

7

8


Conclusion.

We predict collaboration will continue to be a big part

of British business in the future. In an increasingly

competitive business environment, having a greater range

of skills is more important than ever. Strong relationships

are crucial. And whether they are forged online or offline,

through existing connections or networking events,

partnerships are as relevant as they have ever been.

In this ever-changing world, technology will continue

to be a key enabler. It’s the glue that binds the business

community together. It has the power to connect people

and projects even beyond national boundaries. It can also

be a way of nurturing and protecting vital relationships.

Whatever else happens in the future, we can safely predict

that we will become ever more reliant on technology as

the medium through which we create and experience our

business relationships.

Case Study: Joe & Seph’s

His dad used to make fantastic flavoured popcorn, and four

years ago Adam Sopher, his mum Jackie and his brother

Paul decided to take a punt and see if the world was ready

for gourmet popcorn. With dad as Head Chef and mum in

charge of packing and logistics, Joe & Seph’s Popcorn was

born. They now produce 40 award winning flavours (they

have 24 Great Taste Awards).

Joe & Seph’s has collaborated with the likes of Laurent

Perrier, who they made a bespoke popcorn flavour

inspired by the LP’s Chelsea Flower Show garden. Their

partnerships are not limited to food and drink companies -

they were recently approached by a Covent Garden clothing

store. Adam probably has one or two partnerships at a

time, around 20 in total since the start of the business.

They’re not all permanent; they usually serve a specific

purpose.

Adam gets support and advice from an informal network

of other food businesses who are offering similar premium

products, and says “it’s great to bounce ideas off each

other. The food community is small so it’s easy to pick up

the phone and chat to someone”.

But social media also has its place. Adam finds that

LinkedIn is a great tool for finding the right contact within

a company he might want to approach, for example as a

potential stockist. It’s really useful, as category buyers in

the food industry are renowned for moving around a lot.

He also uses Facebook, Twitter, Instagram and Pinterest for

brand building and “loves pretty much all social media”.

And how is it working with his family? “We all get on really

well”, says Adam, “Of course there are challenging times,

but as we’re family we are able to 100% trust each other

which is so important”.

9

10


To find out more about BT Business

please visit bt.com/business

More magazines by this user
Similar magazines