Talking Networks: Between Rhetoric and Reality

There is little doubt that in this age of globalization, speed and digital distance, the effectiveness of a trade support institution (TSI) is relative to its ability to participate actively in formal and informal networks. Without networks and their related industries, such as information and communications, the modern economy would be much diminished, and the TSI fundamentally altered.

The very attributes of a TSI mean that there is a need to network, perhaps more so than for any other kind of organization. Apart from the relationships that business firms usually have with suppliers, customers and other industry players, the complex environment within which TSIs operate requires an equally complicated network of partners. Networks can thus ultimately shape the reach and range of a TSI's scope of activities, and can delimit a country's modes of participating in the global industrial fabric. TSIs can also affect macroeconomic policy and economic performance, and they shape the incentives facing firms in their market activities. It is clear then that a successful trade support network can bring about comparative economic advantages.

However, the export strategy-maker is faced with a daunting task, since fostering a trade support network and maintaining its momentum is not easy. There is often a void between rhetoric and reality. Achieving a holistic approach to the trade support environment is a challenge that requires time, resources, reconciliation, ability and leadership.

At the national level, significant advantages can be achieved through coherent and consistent efforts among the various players involved in international trade. Whether national institutional networking aims to project the country's image as a trading partner, provide support services to industry, enhance SMEs' international business opportunity capabilities, or to create a suitable macroeconomic policy, the results can be productive and include:

• a better flow of ideas from an enhanced skills-base, leading to better results;
• greater achievement due to pooled resources, competencies and cost-sharing;
• reduced duplication which cuts down waste and increases resource use;
• holistic coverage which satisfies a greater number of end-users' needs;
• a unified, consistent vision which reduces the risk of confusing the target beneficiaries; and
• a more credible end product.

Leading the network: public or private sector?

The question of which sector is best qualified to handle the task is not about the issue of more or less government involvement, it is about different governance - characterized by private sector dynamism, efficiency and effectiveness. The export strategy-maker may also consider a participatory approach. This presumes an integrated effort of all stakeholders involved. It also depends on many sources for initiatives and decision-making, allowing access to a wide range of alternative institutions and funding mechanisms in the network. In this way, participatory governance can be the key to ensuring the network continues to serve the unifying purpose. Network leadership can be provided by a public-private advisory group or steering committee which defines its agenda, plans cooperatively using shared resources, and fosters a climate of trust.

No matter which approach is chosen, strong and resourceful leadership is fundamental. The export strategy-maker also needs to feel the pulse of industry; a consultative approach is, therefore, more likely to render better results in a shorter time. Joint ownership is commendable; but it must produce an integration of assets, communication and command in an efficient and flexible manner. Rules need to be broadly defined up-front, in terms of inputs and rewards to be expected. At the same time, care must be taken that momentum is not lost through excessive formality.

The need for evaluation

Performance measurement involves making judgements about the merit or worth of an activity during or after implementation. Evaluation needs to become an intrinsic part of the process of the network's programme design and implementation. The reason for this is simple - there is always room for improvement. A trade support network can only be said to be completely successful when it makes itself redundant - when business firms no longer need trade support services.

Anton J. Said (anton.said@metco.net) is Manager, Business Information and Technology Division, Malta External Trade Corporation Ltd. This is an abstract from a paper which can be found on the Executive Forum web site.