What is Business Development?
What is your definition of business development? Ask seven people what it is and you are likely to wind up with seven different answers. My work with small and medium sized clients has shown that companies define business development based on the situation they are presently in including making a new sale, investing in advertising or offering a new product or service. Also, too many small and medium sized businesses believe that business development options or programs are only for large companies. This is not so.
Clients are often surprised and pleased when they learn that there are at least ten business development options that they can choose from to help solve a problem or accelerate an already successful situation. But you need to consider a few key points critical to a successful outcome.
What problem or acceleration point(s) do you want business development to improve?
Business development options can be used for a wide variety of reasons. To make longer term strategic improvements or the much needed tactical “quick-win”.
Here is a list of the challenges and acceleration points that are most often addressed:
- Reduce time-to-market and time-to-revenue
- Improve the scalability of your company
- Strengthen the go-to-market model for better targeting and ROI
- Expand product and service reach while reducing costs
- Leverage your brand or someone else’s
- Lift your brand
- Target a previously unreachable customer
For instance, I was contacted by a client who said they wanted to discuss increasing sales with advertising. I wanted to understand how they came to the conclusion advertising was the answer. After a two hour session with them it was very apparent that they did not need more advertising. They needed to sort out their sales process since they were unable to work half of the 75 qualified leads already coming in each month. I recommended they sort out their sales process and then, when they have additional capacity to address about 125 leads each month, we can work on a specific business development program (such as a lead agent program) to efficiently generate the additional 50 leads.
Why Will My Company Do Business Development
Understanding why you need to do business development, beyond saying that you want to increase sales and revenues, brings you much closer to defining what the problem or acceleration point is and its successful solution. In order to do this, you must understand what defines good businesses development and what problem(s) you would like business development to solve for you.
A case in point: A 20 person financial services firm had invested in having a very nice logo developed after being assured that this was the next logical step to their growth. While the logo developer was satisfied, the business results were disappointing to the client. After this, the financial services company and I met through a referral. I applied the business development considerations (above) to how they were going to market. It turned out that they did not need a logo, they had a distribution challenge in reaching the correct propsects. We then proceeded to select the best business development option. In this case, it was to form distribution alliances to solve for their distribution problem. Together, we obtained the results the CEO wanted within 120 days.
Define What Business Development Means for Your Business. The most effective business development definition includes these key points:
- The business development program or activity is well defined.
- There will be ramp-up and wind-down time.
- Business development is used to solve specific business challenges or used to accelerate selected parts of the business.
- The business development activity is reasonably sustainable.
- Outside relationships such as referral sources and alliances are two-way activities in benefit (not vendor-client relationships)
- There are measures of success such as revenue, number of clients, reduced cost, increased profitability and more.
Between now and the time we meet again in this space, think about business development options and the challenges you have that may be solved with them. Also, how do you want to accelerate your business? What are your next steps?