Beer (1979) and Checkland (1981) have written extensively on how organisations and networks exist within complex environments, which generate emergent demands upon them (Anderson, 1999, p. 218). In order to remain viable these networks have to be able to fulfill these demands but as Haeckel and Nolan (1996) pointed out: emergence cannot be forecasted and so a sense and respond capability is required. The object of the study is to understand how unforecastable, unplanned for and potentially devastating exogenous shocks to businesses can be mitigated by the benefits of being part of a Smart Network. The contributions of our article apply both to academics and business practitioners and are in its investigation of the concept of Smart Business Networks. In one such network, an electricity market, we illustrate how the smart capability functions at a strategic, business process and technical levels using Beer's Viable System Model (VSM) to analyze it. © Springer Berlin · Heidelberg 2005.