Advantages & Disadvantages of Networking in Business

Business is an inherently social field of human endeavor. Tasks are accomplished through organizations and people working together and applying their different talents and skills. Business networking involves the intentional cultivation of relationships with other people in order to advance in the business world. The practice has many advocates and critics. Regardless, the phenomenon is likely to continue as the social nature of most business practices makes it a clear route to advancement.


Many economists advocate economic egalitarianism as an end where those in lower income brackets are able to advance through effort into higher income brackets. This has many advantages as people are motivated to work after seeing the rewards for their efforts. Business networking can be a way to increase egalitarianism by allowing more avenues for advancement than would otherwise exist. On the other hand, too much advancement through networking may block other avenues of success.


Most businesses strive to achieve a meritocracy where employees are rewarded based upon their effort and performance. Networking is often a disadvantage in this context as it allows for a way around more meritocratic routes of advancement. The many advantages of networking for individuals are often at odds with the many disadvantages for organizations at large. This conflict often has to be managed by skilled executives in business and elsewhere in society.

Social Networks

With the incentives to network so prevalent in most conventional business environments, the creation of social networks is a common phenomenon. Groups of people who know each other through networking tend to associate among themselves and promote each other's interests. As an advantage for a business this may aid in creating a positive corporate culture. As a disadvantage it may tend to create a culture of exclusion that outsiders find hard to penetrate.

Digital Networking

Developing a facility in the more old-fashioned form of networking gives an employee a key advantage in the new areas of the digital economy. Networking seems to be a key part of Internet commerce as self-promotion through personal relationships is a major driver of traffic. Negotiating and making deals in the digital economy often involve heavy use of deals. Often in the digital economy it is who you know that matters most.