Business Development Requires a Multitude of Skills

Business development is one of the functions that every company, from inception to exit, performs at one time or another. It’s also one of the most “unbounded” roles within a company. For some companies, business development means acquiring new customers. Others, it means raising capital. And, for yet another set of people, it means to build alliances and partnerships.

Whatever the term ultimately means to anyone, it is a function that clearly requires a multitude of skills. Let’s take for example, raising money. A business development person in a small startup company would be responsible for building relationships to raise venture capital and/or general financing for startup operations. Oftentimes, the reason this function falls under business development is because the business developer is building strategic partner relationships. Some of these strategic partners deem the relationship critical to grow new business opportunities. In that respect, the strategic partner will then invest money in return for an equity stake in the startup company.

In the case of building and managing partnerships, the business development team is often called Alliances. In this example, business development or Alliance is responsible for recruiting, managing, and supporting partner companies. In addition to this, the Alliances organization would also have a responsibility for driving a certain amount of revenue through the partners, as well. This alliance function essentially builds a core ecosystem around the host company. The ecosystem effectively allows the host company to be in more markets, capture certain geographic territories, or even drive more revenue than it could on its own.

Building joint ventures is also a form of business development activity. There are times when a company needs to work together on a specific business opportunity. The opportunity could be related to driving new business in a specific country or perhaps in a particular industry. The two companies would develop an operating agreement under which they will work together. Shared revenue and expenses, team alignment and sales targets are examples of agreements created as part of this joint venture relationship.

Driving sales is another function where business development is often categorized. This is especially true when a company is first starting off in business. Many small companies categorize their sales efforts as business development rather than sales. One of the reasons for this is because the territory is new or perhaps the product line is untested with customers. The business development group is responsible then for selling new business in an uncharted environment.

Corporate development is another function often interrelated with business development. In general, though, a corporate development function handles aspects of mergers and acquisitions for a company. Their role is to identify companies that have synergistic business models and would complement the host company. In many aspects, a corporate development officer for a company has similar skill sets and experience as all of the above organizational roles.

As one can ascertain, business development is a “catch-all” term that can encompass many different roles within an organization. That said, the skill set and experience for a business development executive is fairly broad. He/she must be versed in areas, such as building partnerships, strategy, technology, geographic markets, sales, and, of course, finance. In addition, understanding the specific industry in which the company operates is icing on the proverbial cake.

The business development executive is a key contributor to the success of a company. This individual, if used properly, can help create the very foundation on which a company operates.

5 Business Development Don’ts

5 Business Development Don’ts

In my over 25 years experience in business development for Financial institutions, IT enterprises, Law Firms and Medical Practices there is an unfortunate, common repetitive pattern/tendency that costs unnecessary money and reduces efficiencies considerably.

This tendency can simply be defined as “unproductive” business development practices. While it can be stated simply it is NOT a straightforward problem in the least. Not appropriately, consistently and diligently creating and implementing a business development plan can and does cause significant financial and productive leakages to a business entity. For a small or growing company, business or practice, such a business development oversight can and often is very detrimental in many ways.

I have identified 5 of the most common unproductive business development practices. I hope that, if you can identify any or all of these within your business entity, you recognize the red flag and take heed.

The 5 Major Business Development Don’ts are the Following:

1) Don’t Randomly Advertise. Sounds weird, but it is NOT. One of the most common mistakes and seemingly harmless ones is to advertise a company, product or service without a clear target.

Unless you are a large entity, advertising expenditures should be seriously confined for specific targeted campaigns. Brand recognition advertising for smaller and or new practices is NOT an optimum use of resources.

2) Don’t Just “Get” Business- Instead Get the Right Business.

A common mistake in small to medium size companies is to “accept” any client even if the fit is not perfect, i.e. a client project that is not cost effective or a “difficult problematic client” or a client whose request is out of the range of expertise.

This can be a seemingly difficult situation, especially, if there are cash flow issues within a company. However, ultimately, saying no to these clients is the most cost effective solution.

3) Don’t Leave Your Business Growth to “Chance”

Many small businesses and medical practices get “caught up” in servicing clients when ample clientele is at hand, thus, ignoring future business needs. For small to medium size businesses this is one of the major causes of cash- flow problems. There should always be a consistent everyday effort to bring in new clients. This ensures a constant source of new clients as they progress through the customer life cycle.

4) Don’t Ignore Your Previous Clients

One of the biggest sources of potential revenue for any business, medical practice or law firm is satisfied past clients. There are three ways that these clients can generate new revenue for a business: firstly, by cross-selling other products or services that are complementary to what they bought last time; secondly, by up-selling services or products that enhance their growth or customer satisfaction; thirdly, referrals. Satisfied customers are one of the greatest sources of new business. However, in order for this to be successful you must cultivate a “relationship” with your clients via warm calling, holiday cards, emails, gift certificates etc and you must ASK! Previous Clients are the quickest most effective way to gain new clients… do not ignore this financial resource at your fingertip!

5) Don’t Confuse Business Development/Sales/Marketing

Sales and Marketing are quite distinct from Business Development. Simply put Sales represents the completion of a client prospecting stage, Marketing is the means to communicate value and awareness of a product or service, while Business Development represents the holistic/big picture for business growth. More specifically, business development concerns the tasks, processes and preparation for business/opportunity growth. Business Development is in essence the means to obtain the plan and targeting for growth. Having this plan/bigger picture helps to refine the client/service/product penetration and thus expedites and streamlines the sales and marketing efforts.

Ironically, most sophisticated and large companies have well funded business development departments, however, it is the start-ups, small and medium size enterprises that actually need a business development team or process the most.

It is my sincere expectation and desire that should you identify any of these “red flags” in your business it will start a thinking process and adjustment of your entity’s activities and strategies.

Services Provided By Business Development Consultants

Before a business goes public, it must create for itself an identity. To effectively accomplish this, many businesses turn to the help of business development consultants. These professionals are able to help businesses create business plans, brands and much more. Sometimes, they help with development expansion as well as the day-to-day operations that companies carry out. Because of the services these types of consultants provide, they tend to be experienced in an assortment of business-related topics. From brand marketing to start-up budgets to brand development, there are many areas in which the consultants can be of great value.

Brand Development

There is much involved in creating a brand. From a logo to a catchy slogan, a business development consultant will be able to help with the many different brand-related aspects. By creating an effective brand, a business will be sure to establish itself as a trusting company that consumers consistently turn to when they need particular products and/or services. Many times, a business will already have an established brand, but will turn to a business development consultant to help enhance the brand. In doing this, the business is able to reach a wider audience, which helps in boosting profit levels.

Marketing Techniques and Strategies

No matter the industry a business is operating in, it will need to effectively market its products and/or services. For businesses who struggle with this aspect of running a company, it can be of the utmost value to turn to the services offered by business development consultants. From social media marketing to print marketing, the consultants can make sure that a wide variety of marketing outlets are used to increase the brand awareness of a business. Businesses that have yet to create a company website for their selves will definitely benefit from obtaining website development services from a business development consultant.

Business Expansion

Once a business has implemented an effective business plan, it is then time to attract clients and customers. To do this, the business will need to generate and follow through with leads. Generating leads can sometimes be quite difficult; however, with the help of an experience business development consultant, attracting, finding and retaining leads can be much simpler. From identifying target markets to gathering contact information, there is much involved with generating new leads, but a business development consultant can carry out a wide range of processes to ensure new leads are obtained on a consistent basis.

A successful business entrepreneur doesn’t have to possess a formal college degree; however, he or she will need a wide range of expertise knowledge relating to the business world. For some entrepreneurs, the best way to obtain this knowledge is by hiring a business development consultant. This type of consultant can be very resourceful in many business situations, including the development of effective marketing strategies and much more. For many businesses, their success is determined by the consultants that they partner with, making it very important for a professional consulting firm to be hired.