What does business development mean to you and your organization? If you say sales or marketing you probably join a majority of people that respond with one of those functions.
I’ve had a couple of clients over the years that had a business development department headed by a Vice President of BD. There are jobs posted on LinkedIn advertising jobs with that title.
I don’t believe value building business development is a department or a standalone function.
I think it’s much more than either or them or even the combination of sales and marketing.
I ran across an article in Forbes dated 3/21/12 by Scott Pollack with the following definition.
Business development is the creation of long-term value for an organization from customers, markets, and relationships.
Developing your business should be an internal function long before sales and marketing are involved. It should also be a joint effort with shared responsibility and accountability.
The role of business development is not simply to grow revenue and market share, it’s to grow value for shareholders. A repeatable model that provides profitable growth year-over-year builds value. It is not built by roller coaster sales and profit performance.
I just published an eBook entitled “11Barriers to Repeatable Business Development”, that lists the most common impediments to development that I’ve seen in my experiences. Some of those barriers are related to the misconceptions below.
These three focus on sales and marketing effectiveness and where responsibility lies.
Marketing has to have a strategy and a message to communicate. Sales has to have something to sell that meets market needs and is priced competitively. Call it vision, a road map, whatever; you need a clear direction for the organization, defining as a minimum:
- What markets you’ll serve
- What products or services you’ll provide them
- A value proposition that your market understands
- What you won’t do as well as what you’ll do in those markets
- A strategy to compete
- Key performance indicators to measure progress
Absent this strategy your marketing and sales staff are struggling to develop a message that resonates with your market and a selling proposition. Top management can’t just assign a number to the sales organization, and tell marketing to get the word out. Since an estimated 50% of small and mid-tier companies don’t do an annual strategy review, that’s exactly what happens in some cases.
You cannot grow sales year over year if you can’t execute. If you haven’t done the work to define, document and refine internal processes so that you can deliver quality every time, you are throwing up barriers to your sales operation. While execution may not seem to be a part of sales and marketing, and part of traditional business development, try and grow your business without it. This is also a senior staff responsibility. The message throughout the organization should be, “everybody sells”.
Both of the misconceptions above are the responsibility or the owner or CEO. You many have a Vice President of Marketing, or Sales or even Business Development, but the ultimate accountability rests with you. You pick the team and set the expectations, but you can’t simply delegate accountability to your staff. Regular review of sales and marketing performance must include more than sales numbers. Your strategic assumptions should be reviewed on a regular basis and revised as needed.