June 17th, 2019
Top management does not always recognize the importance of Business Development (BD). When your resources are scarce you need to prioritize whether to spend most of your time and effort on direct sales or on “indirect” slower channels that eventually drive top lines.
The perception behind the BD efforts are sometimes justified:
· It requires expensive, skilled, resources and traveling
· It takes time to build the proper relationship and the supporting operations
· It requires a certain level of maturity and referenceable track-record (As any future partner will expect)
Once you’ve decided to invest in business development you need to be attentive and avoid the classic pitfalls:
1. Define your strategy – the process of allocating the right partner takes time, so start by defining the strategy and goals of your business development.
You really need to get to know the real interests and DNA of any kind of partnership. Years ago, I was naïve enough to believe that having one of the big four consultancies would be a game changer. Later on, I learned that in large consultancies, every geography had different decision makers, agendas and focus, and there is typically no central decision making unit to drive forth my company’s proposition and position it, as in “we need to push this product to market as if it were our own offering.” Consequently, the efforts in moving such a big player towards tangible business results are enormous. Conversely, smaller boutique firms are generally far more eager and accessible, and thus can provide quicker wins.
Take a deep breath, understand your expectations (and set stakeholder expectations accordingly)
2. Create the demand – WIFM (What’s in it for me) must be aligned with your partner’s goals. By presenting demand (actual prospects that may benefit), not only will you achieve a quicker business understanding with a partner, you will also have a better chance of improving your business terms once the partnership is formulated.
3. Timing is of great essence – agreeing to and then executing partnerships is a costly and time-consuming challenge - you need to sell together, sign contracts and deliver together. This requires considerable maturity and stance to withstand the investment mutually taken and achieve a joint offering.
4. Top down – Always make sure you have your partner decision maker’s buy-in.
5. It’s all about the people / person – eventually it will all boil down to one or two champions who have really tied their personal success with yours. Invest and empower them, and at the same time reduce the risk of losing them by expanding your brand awareness across your partner’s management team
6. Win-Win business model – if you really want your partner to invest in your mutual success, make sure you really understand your partner’s business model and try to build the compensation model and value proposition in a way that benefits their business (This is more than just the share of revenue they get from the deal).
7. Size matters – as you grow you may find that the major large players with broad existing customer bases are much harder to achieve and maintain. Sometimes smaller and “hungrier” partners work better. Remember we are all human, part of an organization that has its own goals and KPIs. Choose your partners wisely and fine-tune your approach accordingly.
Remember that if done correctly, the potential direct value delivered by full time business development professionals can eventually be multiple times higher than that generated by direct sales professionals.