16 Oct
Business development professionals work to develop a company by evaluating their performance and looking for areas to improve.
Improvement may come in the form of building and maintaining relationships with allies and partners, or it may involve identifying opportunities for growth in other channels. Working in business development offers growth potential and the option to have a fulfilling career.
Business development encompasses a wide scope of ideas, activities, and initiatives that a business owner and management implement with the goal of making the business better. It can include many objectives, such as sales growth, business expansion, the formation of strategic partnerships, and increased profitability.
Business developers should be aware of new market opportunities, possibilities for expansion, competitor developments, and the current sources of the company’s revenue.
Let’s walk through the breakdown of what business development exactly means, go over how it differs from other similar roles in a company, and show you the skills you’ll need to succeed.
What is business development?
Business development is the identification of long-term methods to increase value through the development of relationships, markets and customers. The core responsibility of a business developer is growing a business. Depending on the industry, the day-to-day tasks and strategies to achieve this goal will vary, but the overall mission remains the same.
While many business development roles require a degree, it depends on the company and position. In most cases, you’ll need experience in sales, marketing or business management. Certain skills are also vital to your success in this field, including those in sales, communication, negotiation, marketing, data analysis and project management. By building these skills, you can increase your chances of success in the field of business development.
In order to understand how business developers can achieve this feat, here’s a breakdown of the key areas that make up their role:
1. Find growth opportunities
A business needs to be able to grow steadily to be able to compete successfully against others. Business development will focus on pinpointing specific growth opportunities.
For instance, a biz dev team might look at how a company can expand into different markets and conduct research into developing new products or services. These changes, in turn, can help them access more clients down the line. Business developers may also be involved in finding smart ways to market a small business, or working with marketing experts on campaigns that’ll drive the desired growth.
2. Increase profitability
When talking about a company increasing its value, we’re usually talking about profits. While there are many things in a customer’s eye that might make a company valuable, for a business the value is intrinsically tied to the profits it’s bringing in.
That’s why biz dev teams will often focus on concentrating sales efforts. This can include expanding to new audiences and looking for ways to find more clients while keeping costs low. While this isn’t the same as sales itself, which we’ll get into soon, it’s similar to the formation of strategies that help increase sales.
3. Build long-lasting relationships
In the field of business development, the focus should also shift to creating bonds with both customers and strategic business partners. Above all is, business development is done with people not
When talking about relationships with customers, business developers look for ways to bridge the gap between what customers want or need and what the business is actually offering them.
They will look for ways to make a product or service more appealing to clients based on feedback or market research, and then liaise with other departments, like marketing, product development or sales, to make it happen.
Likewise, relationships can also be external. For example, during the growth stage, a small business might need to foster strong partnerships with other companies in order to get started. Alternatively a larger company can help a newer one with guidance, capital, or even infrastructure if that’s not yet in place.
Sales vs. business development: What’s the difference?
In the simplest terms, sales is tactical, whereas business development is primarily about developing a strategy. When trying to define business development, people may not know how to differentiate between their roles and the roles of salespeople. However, understanding business development involves looking at how the company can grow effectively. Although the sales team works to expand the company as well, business developers work with other potential partners and businesses, rather than direct customers.
If a company is seeking to expand and grow in other ways, business development opportunities may be the best solution. A skilled business developer can form and nurture long-term partnerships that lead to additional leads and closed deals. As a result, the business may be able to grow without the need for a massive increase in sales staff.
Business development focuses on the long-term success of a business and finding the best ways to achieve that success. By identifying and creating business development opportunities, companies can form relationships with partners that will help them through referrals for a longer period of time. For some companies, business development is the means that create long-term value.
You can think of marketing, sales, and business development as a cycle of lead generation and treatment. Each one handles a different aspect of the buyer’s journey:
- Awareness: This is when a buyer recognizes they have a problem and knows they need a solution, but they’re not sure what it is yet. In order to get a better understanding of what that could be, they research the consumer market.
- Consideration: At this stage, a buyer has a better understanding of their problem and is committed to finding a solution. They might be considering a few different approaches or answers, but haven’t settled on one.
- Decision: The buyer knows the solution they need, based on their research, and might be looking at multiple options from various companies or vendors, before ultimately settling on one option.
Once you understand how the buyer’s journey works, you’ll also have a better grasp of the roles of each department during different stages. In our case, business development is responsible for reaching customers in the awareness stage as well as in the consideration stage. They will look closely at the buyer’s problem and try to figure out how their own products can act as a solution.
Moreover, Marketing also works in the awareness and consideration stages, with some changes. Marketers will try to present their brand directly to the buyer during the buyer’s research phase. Finally, the sales team is responsible for guiding the buyer through the decision stage and getting them to choose their product or service, thus closing the deal.
Skills you need in business development
1. Strong leadership and management skills
Since your goal is to help the company grow and be more profitable, you’ll need to create new ways to accomplish that. The position requires you to find and think outside of the box to improve business processes, increase sales, and make the company more valuable. Other departments will look to you for guidance and to set expectations, so you’ll need to possess entrepreneurial and leadership skills to design your own projects and manage them accordingly.
2. Goal setter
The ultimate goal is growth, but in order to get there, you’ll need to set a whole collection of smaller goals along the way. When you work in business dev, it’s rare that others will set goals for you. Upper management might tell you what they want or need, but ultimately, it’s up to you to organize your work. It’s also key to have a good grasp on how to create SMART goals, which will set expectations for other departments, namely sales and marketing.
3. Curiosity
You might not have expected this one, but being curious can open the door to so much more when you work in business development. A good business developer is inquisitive about everything, from how to improve the sales funnel to why some partnerships are stronger than others.
With curiosity comes a drive for research, which can help you understand your brand’s shortcomings and fix them so that it may grow. Curiosity also breeds creativity since you’ll be constantly looking for new solutions to ongoing challenges.
4. Acute attention to detail
Whether it’s a metric or a communication from a client or a potential partner, business developers require a lot of focus to pay attention to all the details, and there are a lot of them. When you’re working on a few different projects with various teams, it’s easy to let things fall through the cracks, but a good business developer will pay attention to small details to try and understand how they affect the big picture.
5. Boot-strapper
As a business developer, you’ll have to roll up your sleeves when it comes to breaking new ground. You’ll quickly find out that in order to grow a business, you’ll need to identify and bootstrap new paths to travel on.
Being a self-starter will get you far in business development and help you achieve bigger goals by nurturing your entrepreneurial drive. This sense of ownership can inspire you to take on more initiative, as well as study new concepts and do anything you can to bring more value to the business.
6. Team player
By now it seems like a cliche to see “team player” as a requirement on a job posting, but working in a team is an essential skill in business development. We’ve already seen how biz dev works hand-in-hand with other departments, so interpersonal skills and the ability to work collaboratively are necessary.
More than that, though, is having the understanding that in biz dev, there’s nearly nothing that comes across your desk that you can pass off or ignore. “That’s not my job” just doesn’t work when you’re working towards such large company goals and you need to have your finger on the pulse of what’s going on in the entire business.
7. Self -motivated
If it wasn’t clear by now, business developers need to have a ton of motivation. Truckloads of motivation, in fact. It may seem like there’s too much work in business development to handle, but a successful business developer will know how to prioritize tasks while also self-motivating themselves to complete work and even seek out work.
It’s true, the workload can be a lot, but when you’re able to get your own projects off the ground and see the success of your team and your business as a result of your own hard work, then all the work is worth it and can motivate you to aim even higher.
What should a business developer know?
Since business development involves high-level decision making, the business developer should remain informed about the following:
- The current state of the business in terms of SWOT analysis (strengths, weaknesses, opportunities, and threats)
- The current state of the overall industry and growth projections
- Competitor developments
- Primary sources of sales/revenues of current business and dependencies
- The customer profile
- New and unexplored market opportunities
- New domains/products/sectors eligible for business expansion, which may complement the existing business
- The long-term view, especially with regards to the initiatives being proposed
- The cost areas and the possible options for cost-savings
Understanding the basics of business development
Business development activities extend across different departments, including sales, marketing, project management, product management, and vendor management. Networking, negotiations, partnerships, and cost-savings efforts are also involved. All of these different departments and activities are driven by and aligned with the business development goals.
For instance, a business has a product or service which is successful in one region, such as the United States. The business development team assesses further expansion potential. After all due diligence, research, and studies, it finds that the product or service can be expanded to a new region.
1. Sales
Sales personnel focus on a particular market or a particular set of clients, often for a targeted revenue number. In this case, business development assesses the markets and concludes that sales worth $1.5 billion can be achieved in three years. With such set goals, the sales department targets the customer base in the new market with their sales strategies.
2. Marketing
Marketing involves promotion and advertising aimed towards the successful sale of products to end-customers. Marketing plays a complementary role in achieving sales targets. Business development initiatives may allocate an estimated marketing budget. Higher budgets allow aggressive marketing strategies like cold calling, personal visits, roadshows, and free sample distribution. Lower budgets tend to result in passive marketing strategies, such as limited online ads, print ads, social media ads, and billboards.
3. Strategic Initiatives or Partnerships
To enter a new market, will it be worth going solo by clearing all required formalities, or will it be more sensible to form a strategic alliance or partnership with local firms already operating in the region? Assisted by legal and finance teams, the business development team weighs all of the pros and cons of the available options and selects the one that best serves the business.
4. Project Management/Business Planning
Does the business expansion require a new facility in the new market, or will all the products be manufactured in the base country and then imported into the targeted market? Will the latter option require an additional facility in the base country? Such decisions are finalized by the business development team based on their cost- and time-related assessments. Then, the project management/implementation team swings into action to work towards the desired goal.
5. Product Management
Regulatory standards and market requirements vary across countries. A medicine of a certain composition may be allowed in one country but not in the other, for example. Does the new market require a customized—or altogether new—version of the product?
These requirements drive the work of product management and manufacturing departments, as decided by the business strategy. Cost consideration, legal approvals, and regulatory adherence are all assessed as a part of a business development plan.
6. Vendor Management
Will the new business need external vendors? For example, will the shipping of a product need a dedicated courier service? Will the firm partner with any established retail chain for retail sales? What are the costs associated with these engagements? The business development team works through these questions.
7. Negotiations, Networking, and Lobbying
A few business initiatives may need expertise in soft skills. For example, lobbying is legal in some locales and may become necessary for penetrating the market. Other soft skills like networking and negotiating may be needed with different third-parties, such as vendors, agencies, government authorities, and regulators. All such initiatives are part of business development.
8. Cost Savings
Business development is not just about increasing sales, products, and market reach. Strategic decisions are also needed to improve the bottom line, which includes cost-cutting measures. An internal assessment revealing high spending on travel, for instance, may lead to travel policy changes, such as hosting video conference calls instead of on-site meetings, or opting for less expensive transportation modes.
Management can implement similar cost-saving initiatives by outsourcing non-core work, such as billing, accounting, financials, technology operations, and customer service. Strategic partnerships needed for these initiatives are a part of business development.
Business development tools you’ll absolutely need
Aside from your colleagues and assistance from other departments, there are a few tools that are especially helpful for the day-to-day tasks of business development. These tools will help you manage your workload, stay on top of tasks, or organize projects with ease:
- Marketing automation tools: It lets you run specific tasks automatically without your intervention. For example, you can automate emails, pop-ups, invoices, and a number of other things to save time. This is especially helpful if you’re in the phase of collecting information about your audience and you want to engage with them but you don’t have the resources to do it on the spot.
- CRM tools: Since relationships are so important in business development, you’ll want to invest in a good CRM (customer relationship management) tool. This will allow you to keep track of both clients and potential partners. You can collect all their contact details in one place, track communications across multiple channels, run reports and gain analytical insights, view their spot in a sales funnel, and more. Ascend by Wix is a great CRM tool for small businesses that can integrate with your website to help you capture leads and reach your goals.
- Task management tools: Aside from tracking your customers, you also need help keeping on top of all your tasks. Use a workflow planner or task management tool to stay on top of all your tasks, organize them, and communicate with your team to see where everyone’s at. You might want to consider tools like Trello, Asana, or Slack.
- Networking tools: Before you add new partners or clients to your CRM, you need to first make an initial connection. Don’t underestimate the power of social media in order to network. Twitter and LinkedIn are great places to make professional connections with others in your industry.
Wrap up
Business development may be difficult to define concisely, but it can be easily understood using a working concept. An open mindset, willingness for an honest and realistic self-assessment, and the ability to accept failures are a few of the skills needed for successful business development. Beyond the ideation, implementation, and execution of a business development idea, the end results matter the most.
The brightest minds in business development should be ready to accommodate a change in order to achieve the best results. Every approval or disapproval is a learning experience, better preparing these professionals for the next challenge.