First things first, what is business development?
There are many definitions out there. To sum it up, business development comes to revenue generation. To reach that goal, there are many hats contributing to the task directly or indirectly.
There are five key elements: Marketing, Sales, Customer Retention, Product evolution, and New business opportunities.
The direct impact comes from marketing and sales hats.
Marketing is responsible to create attention to the product in the big market jungle. Doing branding, organizing events, creating campaigns, announcing your presence in the digital world, doing a press release etc…
This attention is followed up by sales, not mindless but intelligent sales. Sales cycle depends on the product or the service but this can be quite long. First, there is pre-sales time where you qualify your opportunities. Not every opportunity is to be pursued blindly. Some can be a waste of your time. You want to chase the ones that have high probabilities of bringing your business. After the qualification, you need to demonstrate the value of your product/services to your potential clients.
For the clients who are convinced by the value of your product, you will be entering into the negotiation and final closure that should be handled delicately and proficiently especially if you are dealing with medium to large scale customers, typically B2B cases. Attention not to mess up things at the last minute, prepare, rehearse… When the deal is signed with the client, revenue generation goal is achieved at this stage.
But you are far from the end because there comes the post-sales period where you continue to support your client through customer support and professional services. This is still part of business development because you need to prove that what you promised is what you will deliver. You strengthen your relations and build partnerships.
Many mistakenly think that by signing the deal or by getting the customer, you are done. Yet, this is where true customer retention is to be gained with customer loyalty. Retention brings sales repeatability, which is a big axis for business stability and growth. How responsive is your customer support, how helpful are you to customer issues, how do you handle billing and commercial terms?
These activities also have very close ties with product development. The post-sales operations help to evaluate the product in a more profound manner. We are talking about customer feedback and satisfaction from a continuous product or service utilization.
Some features will demand more product stability, some features will be abandoned and new ones will emerge from the field use. It is a real brainteaser to give the right priorities and to ensure healthy product evolution.This product evolution gives birth to new business opportunities and hopefully tones your existing business.
Who does business development do?
Not a clear answer to this question. This depends on the company’s needs and organizational structure. I have seen many different forms of organizations when it comes to BizDev. Mostly salespeople but it can be a team of mixed skills such as sales, marketing, and services. There can be one specific entity called Business Development who is in charge of the overall task or it can be distributed to different entities. One’s BizDev may mean a slightly different thing in another company. For some, it can be pure hunting and going after leads but then they hand the rest to sales teams, and sales to post-sales. This interpretative difference is often driven by company sizes. Small – medium – large size companies have different needs to accommodate when it comes to growing their revenue. See also this post on using WordPress.
For start-ups, you definitely need a Business Partner or Associate, whatever you name it but somebody who is purely focusing on building a customer base and growing your business. As always, there are many scenarios how you can integrate business development to your company depending what stage you are at. In any case, you can find entities specialized in getting you help to set-up and ramp-up your activities.
For early start-ups, if this person is not in your founding team (which is often the case especially for techie start-ups), then ensure getting external help while launching your product and preparing for market readiness. If you manage to secure early adapters, think of getting someone more dedicated to this activity.
Ensure to address the five phases of business development. :
- Customer retention
- Product evolution
- New business opportunities
Even though it would be wise to have separate entities for each of these phases, you may not afford this if you are at early stages of building your business. However, this does not prevent of executing the phases, possibly with a scenario of some entities carrying multiple hats.
Also, ensure to have a dedicated person keeping an eye on the global vision of what is happening on the business development side.