Local Area Networks (LANs) are the network wires and devices that connect all of the computers together in an office. Do you want to have shared space on a hard drive so that everyone can get access to the same files? How about printing to the printer at the receptionists desk? Do you want to share Internet Access between multiple computers? Then a LAN is your solution.
Most small networks use Ethernet as a network medium. Ethernet is the least expensive, most common method of connecting all of the computers in the office together. Ethernet uses Category 5 (or better) wiring between all of the computers and a central location.
However, it doesn't have to be as ugly as most technicians install it. Ethernet wiring should NOT be hanging out of holes in the wall, or dangling out of ceiling tiles... or draped around the room. It should be installed properly, and run through wall cavities or surface mount conduit, installed in wall boxes and covered with an appropriate data jack and wall plate. It doesn't take that much more time and effort to do this in many situations, so there is no excuse to have ugly network wiring.
It's not just aesthetics, either. Network wiring that is protected inside walls and terminated properly prevents failure due to kinking of wires or other accidents that happen with wires that are draped around furniture or tangled and twisted up behind the desk.
Usually hubs or switches are used to connect all of the wires together in a network. There is a big difference between the performance of a hub and the performance of a switch. A hub "shares" the bandwidth between all of the computers on a network and usually runs at 10 Mbps. A switch can run at up to 100 Mbps and each computer gets a full chance at all 100 Mbps between it and the switch. Truthfully, though, most small office networks can run on a 10 Mbps hub and usually don't notice a significant difference between that speed and a switch. However, switches can prevent errors on one part of the network from bringing down the whole network at the same time. If you have a choice, a switch is the better network device.
Routers and Firewalls are usually connected to the hub or switch, and also connected to the Internet. Common small office Router/Firewalls are made by Linksys and NetGear.
Internet access sharing is based on the technology that you use to connect to the Internet. If you use a Cable Modem or DSL, installing a Router/Firewall (as described above) can do the trick. If you use dial-up Internet Access, there are modem sharing devices or Internet sharing via software. There is no "right" way to do this, but there are several ways that make it easier or more reliable than others.
If you have more than one computer in the office, you probably want to share a folder on a hard drive or share printers. You can invest in one good printer and allow multiple people to be able to print to it. For slightly larger networks, there are printers with their own network interface cards. These printers do not have to be connected to a computer directly, and also do not need a specific computer to be turned on in order for other computers to be able to print to them.
Many people ask about wireless networking technologies. Wireless technology pricing is falling and is now within reason for small offices to implement. If you have a choice, a wired network is always more reliable and faster than wireless, but wireless does have its benefits in portability and eliminates the cost of wiring.