Why Some Network Groups Flounder

CREATED BY JACKY SHERMAN Published: 15/05/2026 @ 09:00AM #Networking #SmallBusiness #NetworkGroups #Entrepreneur #BusinessGrowth

If you're running your own small business, sooner or later, you will go networking. And when you do, you will quite quickly discover that some network groups thrive whilst others flounder ...

Network groups can often flounder due to a lack of clear goals and communication among members

You will also discover that some thrive and then suddenly nose-dive. Let me share a psychological experiment that offers one reason for that happening. David McRaney explains it in his book You Are Not So Smart.

It's called The Public Good Game!

A group of people sit around a table, and each person is given a few pounds. The group is told they can put as much money as they want into the community pot. An experimenter then doubles the pot, and everyone receives an equal share.

If it's 10 people, everyone puts in £2, so the pot would be £20. It's doubled and then divided among everyone. They all get back £4. The game then continues in rounds. You would think that everyone would just put the maximum amount in the pot each time, but they don't.

Someone usually gets the gist of the game and realises that one can put in very little, or nothing at all, and still start making more money than everyone else. If everyone but you puts in £2, the pot will be £18, doubled to £36, and everyone gets £3.60 ... including you ... the one who put in nothing at all.

Even though this is a thought experiment, everyone
can see what is happening!

The pot initially increases and then decreases due to someone in the group freeloading. Although the others are still winning and could keep winning if they continue, they begin to imitate the free-rider's behaviour to avoid being exploited. Ultimately, this leads to the game stalling entirely.

This behaviour changes only if the group applies sanctions (punishment for the cheater). Just rewarding the good players doesn't work. What people are reacting to is their innate sense of fairness. Psychologically, as part of the tribe, you know that one cheater will ruin everything and that most people will cheat if they think the system is cheating them.

Now, apply that to a networking group!

Everyone is motivated to help everyone else win business. If only one person in the group is taking without contributing, that behaviour spreads. Existing members may not realise that it's happening because high givers will continue to give, but not so much.

New visitors will pick up a reticence amongst existing members to be generous. Slowly at first, but people will start to drift away. At some stage, a few members will form a breakaway group.

The group disintegrates and only strong and, often painful, action will save it .... applying some sanctions to the transgressors. More often than not, the group breaks apart. So, how can you stop this from happening?

Here are my three tips:

• Have clear expectations for the group. What is the purpose? If the purpose is to generate business through referrals, many groups expect you to bring referrals and will monitor members' contributions to that endeavour.
• Other groups may have softer expectations around what counts as giving. Make sure you choose one that fits with your own expectations.
• Give strong leadership that is aware of the group's dynamics, spots people who are floundering or not contributing, and, most importantly, takes action.

Whilst I would always advocate encouraging first, listen to the conversations and be prepared to support the leader in tackling blatant and not-so-blatant free loaders.

And be conscious of your own behaviours too. Are you slipping into destructive behaviours without even realising it? If this group is valuable to you, be prepared to put in the extra effort required to turn this around. Find your allies in the group and start making a difference.

As Gandhi said, "Be the change you want to see in the world".

Until next time ...

JACKY SHERMAN
Join my mailing list! Click here and be one of the first to know when I publish a new blog post!

Share the blog love ...

Buffer Facebook Twitter Linkedin Pinterest WhatsApp #Networking #SmallBusiness #NetworkGroups #Entrepreneur #BusinessGrowth

More blog posts for you to enjoy ...
		The Art Of Bowing Out Gracefully Conceived on your kitchen table, down the pub, after a particularly frustrating meeting with your boss, or that awful moment when you were told you were being made redundant, your business became your baby ......
		How to be happy retiring from your consultancy, without losing yourself What makes a happy retirement when you've been in consultancy for years? It's less about stopping work and more about designing your identity, boundaries and next mission. Here's a clear, friendly way to exit well without bec...
		Preparing to retire: practical advice for small business owners Thinking about retiring from your business can feel a bit surreal. For many small business owners in the UK, the line between 'work' and 'life' has been blurry for years - so stepping back takes more than just choosing a date...
		Why human agency matters more than AI systems As Artificial Intelligence continues to reshape the workplace, many organisations are focusing heavily on technology itself. Discussions around AI often centre on automation, efficiency and productivity, with businesses racin...
		Networking Skills: The Benefits Of Focus In Your Networking Once again this week, I was drawn into a debate about whether to appeal to a wide range of clients or focus on a tight target market. It's a fundamental networking skill to know what you want ......
		The art of outsourcing your visibility so you can get on with running your business After years of working as a coach, mentor, and referral marketing specialist, one of the most common conversations I've had with my clients has been about visibility. Not the flashy kind, not ''look at me'' marketing. Just th...
		What keeps you going in your business? Over the weekend, someone shared with me a poster that compared running a business with an iceberg. The author wanted to make the point that all other people saw was the success ......
		Why is it never too late to think like an entrepreneur Over the past few years, I've noticed a clear shift in how people talk about business, work and financial security. More people than ever are exploring self-employment, side hustles and small business ideas, and it's not just...

Other bloggers you may like ...
		Because someone should notice if you don't check in Posted by Steffi Lewis on https://www.yourping.uk The phrase "Because someone should notice if you don't check in” is far more than just a tagline. It is the core belief behind everything we do. Our d ...
		Lessons I've learned from investment property viewings Posted by Sarah Hannaford on https://blog.sarahpasolutions.co.uk As I keep building my knowledge and experience in property investment, I'm learning that there's a big difference between looking around a house as a ...
		7 Compelling Reasons Why Blogging Should Be the Heart of Your Online World Posted by Steffi Lewis on https://www.sblogit.com Blogging is more than a mere trend; it is a proven, vital component of a successful marketing strategy for businesses of all sizes. By offering regula ...
		How multiple income streams give me time for what matters Posted by Davina Farrer on https://blog.joindavina.co.uk I'm back at my caravan, SeaScape in Bude, and this visit has felt wonderfully different. Last time, I was dealing with the stress of my cleaners sudde ...