Virtual Communities of Practice for Regional Small Businesses: Bringing Informal Networks Online

Virtual communities of practice (VCoPs) are online business networks which are increasingly used by large organisations as a key strategy for creating value in the knowledge-based economy of the 21 st Century. This paper examines the applicability of VCoPs to cross-industry regionally clustered small business networks. Interviews conducted with government and industry informants in two regional areas of Australia indicate that these strategies used for establishing VCoPs are applicable to such small business networks. Both regions had regional networks with active member involvement displaying CoP characteristics. Significant social capital existed on which VCoPs could be built, and there were viable alternatives to satisfy the roles of sponsors and leaders. There were, however, significant impediments that will have to be addressed before VCoPs can be implemented such as the apparent reluctance of many SME owners to use the Internet and ICT generally, and the preference for informal networking. Funding to ensure that VCoPs are sustainable was also an issue. VCoPs appear to be extremely useful in linking small businesses in regional areas and in the development of viable regional clusters.