One of the greatest phenomena of this century both for businesses and society has been “The Network Effect.”

It is a simple externality (mostly positive effect) that one consumer, user or member of a network has on the value of product to the other members in the network.

When we apply the basics of this network effect to our Mason School of Business alumni it exposes a whole new dimension and a way of thinking towards this delicate relationship and maximizing the returns and values from it. Two sub-concepts within the network effect caught my attention.

Bandwagon: People often do and believe things because many other people believe and do the same things. New and innovative ways to reach and involve our alumni to be part of this bandwagon was the challenge that we were facing for the past few years. But new media tools like this blog, LinkedIn and Facebook are proving to be a great vehicle for getting people to “hop on the bandwagon.”

Network Value: If you believe in Metcalfe’s, Reed’s or Sarnoff’s law you know that how valuable a network can be. Currently of the 12000 Mason School of Business alums approximately 1,200 have offered to devote their time and energy towards mentoring and development of current students and alumni. We have just exploited 10 percent of the available base and if you apply any of the network laws, we have an additional 8100% (according to Metcalfe’s law) of value still to be unlocked.

The point is that Alma – Alumni is a mutually benefitting relationship. If Alumni connect back to school they not only provide value to the school and “network” but also harness greater value for themselves and their investments (education from Mason School of Business).

Creating stakeholder value is a basic business principal that we learnt at B-school, plugging-back and increasing the value of network for your community and yourself seems to be the right business decision.