When I tell people I’ve just written Business Development for Dummies, I get a range of reactions from “Wow” through “That must have been a lot of work” to “It is any good?” The question that interest me the most, though, is “What is business development – I’m not at all clear about that?” That’s my door opener.
Dispelling the myth
People often equate “business development” with “selling”. It’s a common misconception. You see jobs advertised for a VP/Director/Manager of Business Development, but the job description is all about getting new sales. This view shortchanges business development – it’s so much more than selling. Like the piece of the iceberg under the surface of the water.
There’s lots of ways of defining business development, but as someone who’s worked in B2B services for decades, here is mine:
Business development is the discipline required to achieve growth through the acquisition of profitable net new customers and expansion of existing customers.
Sales is the art and science of presenting a solution to a prospective customer’s need and getting to a transaction, where the customer ‘buys’ your solution.
By contrast, business development is much broader. To develop a business, you have to create solutions to the problems or pains that are common enough in the marketplace for you to build a viable business. Then you have to figure out how to take that offer to the marketplace and generate some results.
Business development encompasses:
• Your offer: Creating the solution you have or the reason your business exists.
• Marketing: Making the market aware of your offer.
• Selling: Acquiring new customers.
• Customer management: Delivering your solution so that you retain, expand and leverage your customer base and successfully manage your customer relationships.
• Partnerships: Joining with other firms to expand your opportunities.
• Feedback: Using opinions to improve your offer (in other words, quality assurance). Feedback can come from customers, from your staff and from the delivery department, respectively.
You can see that business development is cyclical ? a feedback loop, with the potential to improve, recreate and enhance your performance. The power of business development lies within that cyclical nature.
People always buy because they have a need. Even a ‘want’, such as ‘I want a diamond ring for my 25th anniversary’, is a need. I need to show myself, and everyone else, that my husband still loves me. I need to look good to the neighbors (‘Did you see that ring he bought her?’). Businesses experience needs as problems or pains that need to be solved. So the purpose of selling is the same whatever the context – fulfilling customer needs.
Businesses that think of business development as only sales often have big gaps in their business-development cycle that lose them money. Closing those gaps is one way you can boost your results – often dramatically.
Getting those spectacular results takes more than one person. It takes a village, or in a small company, a few key people pretending to be a village (also known as wearing multiple hats). Growth is dependent on creating the vision for business development and then dealing with the reality in your business as it is today.
Next blog: Need growth? Stop and consider before you hire a salesperson.