Ivan Misner the master of Business Networking shares how he took an idea and built it into the worlds largest referral organisation .
How did you g et the idea of starting BNI?
BNI is a perfect example of "Necessity being the mother of invention." I had lost a large customer in my Management Consulting business and was looking for ways to get new customers. I wanted to help friends and get them to help me.
I did not know how to get referrals, earlier to BNI the way I used to get new business was by participating at speaking engagements, and asking existing clients for business referrals. I noticed that there were so many business associates of mine whom I gave business to, my vendors and suppliers for instance, whom I made regular payments to but they were not referring business to me, and I knew that they had clients who could be useful to me. The question in my mind was "How do I get them to refer clients to me?"
Did you have an idea how large BNI would become? Did you have a grander vision?
I only hand an idea of how BNI will be at a micro level. How this group would interact and participate. I did not have a vision at a macro level. When we started, the name was "The Network" and it was a division of the Consulting Business. So I did have an agenda of what we need to do at the meeting, and what the value of joining this network was. So I told people about what we could do together through The Network, get trusted friends, customers, vendors to meet regularly, get to know each other well, and refer business to each other. People were eager to join and willing to pay for it. I had one condition, only one person representing a particular business or profession could join the Chapter. Soon we were so successful that other friends of mine who could not join this chapter, wanted me to start chapters for them. By the end of the first year we had 20 Chapters.
What is your key message for entrepreneurs starting their ventures?
When you are starting you might not have all the answers, but don't worry about this. This is how I look at leadership, Imagine you are in Business of making a path through the forest. So you take an axe to cut down trees. You get successful at this and then hire people to cut down more trees, then you get trucks and people to coordinate this. All this activity is not leadership, this is Good Management. Leadership is climbing the tallest tree and looking around the forest and then saying, "That way", "This is why we need to go that way".
Early on in the venture you cannot see too far. Every year in December, I have my way of climbing the tree. I look back at the year gone by and think through what I need to do in the future. At the end 1985 the first year of BNI, I had 20 Chapters and I realized that I had struck a chord. "The Network" had grown a lot bigger than I thought it could be, and thought that it could go National. I also realised that in a lot of Chapters things were not going the way I had originally planned. So the need for a structure, manuals, systems etc. There is a nice book I read called E-Myth, the author Michael E. Gerber says that you should write down information about your business as if you want to franchise it, or sell it. Even if you do not want to franchise at that time. This gets you to start thinking deeply about your business. I had no inkling of franchising at the time, but decided to do the hard work needed to document everything, including how to train directors. Entrepreneurs when they are starting a new business don't know what they don't know, so just climb the closest tree and see as far as you can see.
So I created an organisation chart with 15 positions when I had just 2 employees and they too were doing half a days work each. So in effect we were only 2. So in the 15 boxes in the chart I put down our names against whichever activities each one was doing, and every time I hired someone I removed my name from one of the boxes. Over the years I have removed my name from most of the boxes, and new positions also emerged. For instance after 1996 the Internet became big and there were a lot of activities based on this and a new box was created for this.
How did you grow initially and when did you start franchising?
We are located in Southern California, and the further we went from here the more difficulty I had in managing the chapters. At first I thought of licensing the concept, and it worked well, and I decided to do all the work needed to make it a franchise. Earlier I would get calls from different locations, "Ivan we have this problem that I want you to fix." when I started franchising it changed to "Ivan we have this problem how do I fix it." I just loved it. When they owned it they needed help and did not expect me to fix it.
What happened to your Business Consulting Practice?
3 to 4 years into BNI, I sold my Business Consulting Practice. I still was not earning as much from BNI but I could see where it was going. When introducing myself to people I used to say "BNI is my Avocation and Management Consulting my Profession." This bothered me, since I used to always tell people, "Do what you love." So I decided to sell my Consulting Practice and Mortgaged my House to get through those days.
BNI depends a lot on volunteers, member participation is the key, any insights on how to get people to participate, is this similar to what might happen in a Rotary Club?
The key to this is education. In BNI, we take education very seriously, in a year we do more than 200,000 Hours of training worldwide. I think in BNI, there is a clear business motivation why people volunteer. By volunteering one gets visibility, and visibility is great for getting new business.
One of the things I got from the Rotary Club was "The Code of Ethics." We had Member Advisory Board think through the BNI code of Ethics and they had come up with 2 to 3 pages of it. I then thought of the Rotary "Four Way Test" and we decided to make the "BNI code of Ethics" as simple and finally we came up with 6 codes of ethics.
One thing very unique about BNI is that it is so focused on Business Referrals, why did you not expand on the value to members, how and why did you stay so focused?
It is very important to have a Vision where your business is going, and what your role is in that. This is what I call a "Mission Orientation." For instance, a lot of people have told me that we should teach our members to Close Sales, "is this not what members finally want?". They might get referrals but this is wasted if they do not know how to close the sale. My answer to that is we are not experts in closing techniques. For that you have people like Brian Tracy, so just take a seminar with them. By taking up closing techniques we are not on a mission. My message is stay on the mission and put on "Mission Blinders" when looking at opportunities, even when you are so excited about it. If you try being everything to everyone, then you are nothing to anyone.
So if you see an opportunity, ask "does this carry your vision", and also ask who does it better. If the answer is "That organisation does it better." don't do it.
There is an interesting blog I wrote on The “Butterfly Effect of Networking" I am sitting in Richard Branson's private island, and wondering at the series of events that brought me here. It all started when a woman I did not know asked me to help her with Networking Content for her Training Organisation. I put on my Mission Blinders, writing on networking was there in my plan but 6 months too early. However since it was there in the plan I said OK. This led to a series of events, the end of which was me sitting with Richard Branson in his Private Island.
The butterfly effect drives home a key point about Networking, it is so powerful, but feels so random. It is a good idea to sometimes look back on how a key connection happened, this will drive home the value of Networking and keep you at it.
The world is changing, with online social networks, how is BNI going to evolve in the future?
Face to face physical meetings, is very important for communication, trust and relationships to develop. The reason why we are having this interview face to face is because this cannot be easily done online. However there is a need to leverage the Internet, and there is a big demographic shift which is happening. By the end of next year, 50% of our members will be from a generation which is non-baby-boomers. They will be from the GenX and GenY. So there is a need to integrate with this online technology. The change is also from looking at BNI as a Network of Local Businesses, to a Local Business with a Global Network. I asked a Dentist, if he would like to network with another Local Dentist, and he said, "No because this person would be competition." "What about networking with a dentist from another country?" I asked him. "Sure" he said, "because then he can share knowledge with him."
Also when people visit other countries they would like to connect with professionals there and visit chapters. So the New BNI-Connect will facilitate all this.
For an organization with so many members and so much of interaction and involvement required from people, what is your key message regarding dealing with people?
You cannot motivate people, all you can do is create an environment where people motivate themselves. So by focusing on creating healthy chapters we can help people motivate themselves.
I notice that there are certain aspects of BNI, like the meeting agenda that you just do not allow any deviation, and others like running a region that you allow a lot of flexibility? How do you make these trade-offs?
You might know what works best and have rules, but don't be overbearing with them. There is a fine balancing act. The BNI Agenda is proven to work, we have made changes to it over the years, the Agenda is the essence of BNI and how a BNI meeting is conducted, so it is followed in the same manner every where in the world. We have brought in changes over the years to it, but we do it very carefully and only if the change is proven to work on an experimental basis.
Regarding running the Franchise, I can tell you how to run the business, but it may not fit the strengths and weaknesses of the owners. So we allow them the flexibility to figure out what works best for them. So we create a broad framework and people do work within that framework the way they want. If we allowed for no change and laid it out exactly how we want it done, people would just refuse to do it.
People behave in different ways. You could look up the DISC model which was developed by the Psychologist William Moulton Marston. His model is very useful in understanding how different "normal" people behave.
So many members, so many chapters, so many countries, any key takeaways on dealing with people?
People don't care how much you know, if they don't know how much you care. This reminds me about my visit with Richard Branson, he took us to a new island he had bought called the Mosquito Island. There two workers, where breaking down an old building with sledge hammers. Richard Branson went up to them and started talking to them. Imagine Richard Branson a billionaire talking to two workers earning minimum wage. Out of curiosity I went closer to listen in. Richard Branson was tell them about what was going to come up in the spot where they were tearing down the old building. He was sharing with them what would happen next because of their work now.
All these concepts are simple but not easy. If it was easy everyone would be doing it all the time.
(The Author Balaji Pasumarthy, the Chief Catalyst of Businessgyan is also the Executive Director of BNI in Bangalore.)