How Important is Networking?
Networking is a crucial skill for a long and successful career in finance. Your network is the product of the interactions and personal relationships made on an ongoing basis. You can then leverage this network for recommendations, business development or just advice. But be proactive; invest your time in building networks before you need them.
Why Do I Need to Network?
As you progress in your career, you’ll see that networking has a direct impact on earnings potential and job security. Networking offers major opportunities. Every person you meet represents a potential customer, a referral, new employment opportunity or a business service partner. A strong network also enhances job security and earnings potential. When you start thinking with this mindset, the bigger picture of networking becomes apparent.
Even if you don’t directly provide the service you can refer them to someone else. The person or organization that received the referral will likely return the favor. Over time, you’ll have built up a strong resource network directing new business to you or your firm.
Perhaps you are a financial advisor who provides services for high-net worth clients or family offices. There are some services you simply can’t provide yourself. This may range from accounting complexities, certain insurance services to writing trusts and wills. Referring these out to trusted and competent members of your resource network allows you to fully cater to your client’s needs and should bring you new business as your network reciprocates.
The odds are you’ll be at a few jobs in your career as the practice of remaining at the same company is becoming scarce. Having a strong network of co-workers is also important if you ever leave your job as they can provide quality recommendations to new openings and opportunities in the industry. Many people become consultants for former employers or related companies in that field so it can also mean new business if you ever strike out on your own. For example, many consultants to the pension industry are former employees of the funds themselves.
Finally, networking is extremely important if you decide to switch careers entirely. Since your prior work experience won’t be directly applicable to finance, you’ll be a blank slate in a highly competitive industry. Your network is what’ll probably get you in the door.
So How Do I Network?
A great place to start networking is within your own company. Getting to know everyone at the office a little better will pay big dividends down the road. Supporting the causes of co-workers is also a great way to engender you to them. Attend or donate to a charity walk for co-worker is involved with.
Introduce yourself to someone from a different department in the elevator or when you’re in line for coffee downstairs. Don’t always eat lunch with the same people; get out of your comfort zone a little. A network of employees in different areas of the company can be a real asset and boost work performance.
For example, maybe you’re working on a large real estate deal at the office, with many different entities involved in the process. You may need a good contact in the compliance department to get you around some red tape, an associate to coordinate with their friend at the bank, someone in the accounting department to sign-off on official documents or even the I.T. guy to put your laptop issue at the top of their list.
Working strongly within a team is some of the best internal networking you can do. It shows you can be “trusted” to play well with others and get the job done. And be appreciative of help you received by giving credit to others often. And a hand written thank you note for small favors received still works wonders, too. Demonstrating that you’re a ‘team player’ with a positive attitude, you’ll quickly gain a good reputation around the company which often leads to advancement within the organization.
You should also network outside your company. Go to places where you know finance professionals frequent. This could be upscale athletic clubs, charity events or alumni and industry associations. The membership lists of many of these associations are accessible and can be great tools for networking.
One of the best ways to network in business is attending industry events. For example, attending local Chartered Financial Analyst (CFA) society functions is a great way to meet local financial professionals. The events are typically not expensive, usually around $25, which you can pay at the door. And you don’t have to have your CFA charter (or even be enrolled in the CFA program) to attend most events. This often includes dinner, a presentation and most importantly, networking. Analysts and money managers are staple attendees but there are people there from different areas of finance-accounting, legal and business development. MBA students from area colleges also attend many of these functions.
All of these people are really there for the networking, which presents a great opportunity to meet new people entering or already in the industry. After you make a contact and exchange cards, invite them to connect with you on LinkedIn with a message, “Enjoyed meeting you at the event the other night”. Your end goal should be to build relationships.
If you’re in school, meet recruiters that come to campus, or virtually, tap career services and socialize with other students. This starts your networking campaign. After school, tapping your alumni base is a great way to network because you’ll automatically have something in common. Many alumni are very proud of their university’s brand and are more than happy to help you. Attend alumni gatherings in your city and join alumni social media groups. Years after graduation, you can usually still use career services from your school as an alumnus.
What’s ‘Network Management’?
Making new contacts is only the beginning; you must reconnect with them often to maximize results. People are busy and may forget about you. Send them updates on your situation, a link to any new publications you may have written or if you’ve been featured in the news. You can mention something that directly pertains to your contact such as “Saw you were quoted in the online journal”. And always end with “if there’s anything I can do for you, please don’t hesitate to ask”. One benefit of professional social media sites like LinkedIn is it will automatically update these things in your news feed to all your contacts. But don’t rely on social media sites as a crutch for all of your networking. Nothing benefits your networking efforts like actually meeting new people through real social interaction.
Being a good networker is a valuable skill to have, not overlooked by people in a position to hire you. It is a leadership quality that should add value to the company in different ways. But networking doesn’t come naturally to many; it’s an acquired skill that gets easier with time. Don’t think of it as practice makes perfect, but practice makes progress.