Kiwi businesses slow to network properly

03:45, Dec 10 2012

New Zealand small and medium-sized businesses underestimate the importance of building strong and varied networks in the development of export products, says a Massey University lecturer.

Loren Stangl said our SMEs are entrepreneurial and innovative but few successfully internationalise their products. 

''We need to quit being a country of independent operators if we are going to grow this economy,'' she said. ''No SME has the resources to do it all themselves - they need to collaborate.''

A strong network might include suppliers, customers, government agencies, universities, Crown Research institutes and even competitors, said Stangl.

She became interested in the topic of SME networks because of the difference in performance between New Zealand and Scandinavian firms.

''When I spoke with New Zealand companies I found that, in fact, they didn't develop the breadth of networks the Nordic firms do, and especially not with organisations that could potentially be competitors.''

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Scandinavian firms are used to thinking as a team, with a long-term strategy about building their industries, she said. In New Zealand, being a small independent operator is part of our culture.

In a study of 50 countries, Stangl found SME's exposure to international people and products had the greatest impact on their ability to export innovative products.

This was more significant than institutional support for innovation and international commercialisation.

That's not to say government doesn't have a role to play, said Stangl, citing the good work of New Zealand Trade & Enterprise and local economic development agencies.

BusinessDay