The term business development has spread in recent years, and there is a section dedicated to startups that assumes this role, with the aim of developing corporate business and taking it to a better level. And what exactly does that mean? How do you manage business development?
What is Business Development?
Business development can be defined as an ongoing process aimed at discovering favorable opportunities for companies to achieve both growth and profitability, whether through acquiring new customers or retaining existing customers.
The importance of the development process is that it helps business continuity, especially with the constant and intense competition, and the need for strong strategies to overcome this competition. Business development tasks intersect with the tasks of several other departments within the company, given that the primary goal is to improve the overall performance of the company. Therefore, the Business Development Department cooperates with the rest of the departments to implement this goal.
For example, the sales department focuses on selling to a specific market or targeting a specific customer segment. The Business Development Department uses a sales improvement strategy, but focuses more on the pre-sale process, with the aim of creating opportunities to generate more sales.
Business development strategies
There are no restrictions on the methods that are used in the development of the work, it depends on the team responsible for this task, and what ideas they have to use in the development within the company. These methods can be grouped into 4 main strategies as follows:
1- Sales Development
The sales development strategy is one of the most widely used business development strategies because it can be relied upon to achieve quick results in the near term. In this case, the business development department works in conjunction with the sales department within the company and presents proposals that focus mainly on increasing sales.
In this strategy, previous sales reports are reviewed, in order to look at the activities that have proven effective within the company, and then work on investing them in a way that leads to maximizing sales. The development process here focuses on finding more potential customers for the company, with the aim of acquiring new customers and then keeping them.
The company can also go back to the list of existing customers who are currently in the company, and then try to sell more products to them, taking advantage of their previous experience with the company. They can be influenced and persuaded to complete new purchases, using appropriate strategies such as cross-selling and alternative selling.
2- Strategic partnerships
Strategic partnerships are one of the most important ways to develop business, and at the same time, they require a great effort to implement them, in order to discover opportunities in partnerships and to create strong alliances that are beneficial to both parties. Strategic partnerships achieve several company goals, the most important of which are:
- Reducing both risks and the possibility of failure in new activities, by cooperating with another party and benefiting from its capabilities and resources.
- Accelerate growth and expected success by doubling the effort in partnership.
- Building confidence in your company as a result of a good partner reputation.
- Control costs and the ability to reduce them by adopting the partner.
There are two main types of strategic partnerships: the first is the limited-term partnership to implement one goal within an agreed period of time, and the second is the long-term partnership to cooperate on several common goals. Regardless of the duration of the partnership, it is based on mutual benefit between the two parties.
Therefore, establishing strategic partnerships requires an effort to build trust with other parties, and it may take time to reach the appropriate agreement. In the meantime, it is necessary to deal with each partner separately in the appropriate way for him and to think about the benefit he is looking for, and then build the agreement on what gives him this benefit, and achieves the interests you are looking for from this partnership.
3- Entering new markets
Business development is related to looking for opportunities for growth and expansion. So, this can be achieved with a new market entry strategy, with the aim of reaching entirely new customers. Of course, there is some risk in this strategy, so it can be mixed with the strategy of strategic partnerships to reduce the risk. New markets can be entered in three different ways:
a. Waterfall strategy
Al-Shallal’s strategy is based on expanding in foreign markets in a sequential manner, as the expansion begins with choosing only one market from the neighboring markets. After completing the expansion in this market, the experience can be used to improve the expansion process in the next market.
B. Sprinkler strategy
This strategy is based on the principle of diversification, so that expansion occurs in several markets at the same time. Instead of concentrating the effort on just one market, expansion occurs in a uniform way in as many markets as possible.
c. Wave strategy
This strategy is an intermediate between the two previous strategies, as it relies on entering a group of markets at the same time, but this happens in an appropriate and specific way for each market, while trying to target a specific number of markets that are similar to the current market in which you operate.
- Whatever the method used to enter into new markets, things must be studied well in two respects.
- finance; So that growth does not negatively affect your company and cause you financial problems as a result of the cost of growth.
legal; So that you are not surprised that your activities will be disrupted due to the difference in laws.
It is also important to make sure that there is a real need for the products or services you sell, then analyze the market to understand the nature of customers and the competition that exists in each market.
4- Product development
Product development strategy occurs in two ways, either by introducing updates and improvements to the product you are currently selling or by creating new products for customers. This strategy helps attract new customers to your company, as well as the possibility of increasing revenue from existing customers.
The implementation of this strategy requires an opportunity that can be exploited, by observing the market well, with the aim of making sure that there is a real need for your product, and then developing the product. It is important not to rely on personal assumptions here, but rather to research the market and communicate with potential customers to find out their opinions, to ensure that there is a real opportunity to sell the product after its development.
A prototype of the product can be created to test it first, then develop it and reach the final product. This will help you save money, especially if this product is not well received by customers after development. The business development role here focuses on how to build the ideal product, which captures a real opportunity in the market, and then work with the marketing department to try to promote this product in an effective way.
How do you develop the appropriate business development plan for your startup?
The success of business development in companies requires the presence of a solid plan with practical steps that can be implemented, with the need to have sufficient flexibility to deal with any emergency, as the work of the development department is based primarily on seizing opportunities. The development plan includes the following steps:
1- Conduct a SWOT analysis
The SWOT analysis is one of the most important tools for the business development department, as it helps to understand everything related to the company internally and externally. By performing this analysis, you will have a proper understanding of the development practices that you need in your company. SWOT analysis includes the following factors:
- Your company’s internal strengths. For example, your brand is known to a large segment of the public.
- Weaknesses and internal problems in your company. For example, a decline in sales of a particular product line.
- External Opportunities in the market that can be invested. For example, the presence of certain markets that need your products.
- External Threats that affect the company’s performance. For example, the high costs of some of the materials that you use in your work.
2- Analyze the market well
The success of business development depends on seizing the available opportunities, and for this to happen, it is necessary to analyze the market well, with the aim of discovering these opportunities. The market analysis includes the following points:
It is necessary to study everything related to the personality of the company’s ideal customer, specifically knowing: the best-selling products and services, customer proposals for the development of existing products, and customer needs that are not yet satisfied. This leads to finding out which development strategies your company needs and which works for your customers.
Competition affects business survival, so a business development manager needs to study everything related to competition such as products and services offered, customer segments they target, their unique selling points USP, sales methods, and customer access.
Partnerships are an essential component of the business development process. Therefore, during the market analysis, it is necessary to search for potential partnerships, and what are the possible aspects of cooperation with each partner.
Understanding the current state of the industry helps predict potential opportunities or threats, for example, is there saturation in the current market? Or are there other markets to enter? Is the industry still popular and has a future, or are there alternative products that threaten its survival?
3- Determine appropriate business development strategies
After completing the above two steps, you will have clearer perceptions of the most appropriate business development strategies that you need. Of course, it is possible to rely on more than one strategy at the same time, according to the current situation of your company, in addition to the resources available to you.
For example, if you find that there is saturation in the current market, this means that you can rely on the strategy of entering new markets. If you find unsatisfied customer needs, this means that you can rely on the product development strategy.
4- Choosing the most appropriate business development practices
There are many practices that can be used to implement business development strategies. Among these practices:
Networking is one of the best business development practices, as it allows you to build diverse relationships, and access potential partnerships to benefit from in the company. Networking can be done by attending events related to your industry or joining specialized digital communities
Public relations is used to build long-term relationships with various institutions in society, through which several useful activities can be carried out for the company, such as organizing promotional conferences and sponsoring various events.
Content marketing helps advertise the company’s experience and enables it to lead thought leadership in the market, in case of providing really strong and useful content, which is beneficial for strategic partnerships, as well as for growth and expansion.
A large part of business development depends on working with companies. Therefore, e-mail can be used to communicate with these companies, try to build relationships with them, and develop successful partnerships in the future.
The cold calling method is one of the most difficult business development practices because it relies on communicating with potential customers without prior planning or agreement. Thus, the possibility of rejection increases in this case, so the call must be managed in a correct manner, to ensure that the desired goal is achieved.
If you do not have enough business development experience, you can hire a business development consultant from Fiverr, the largest independent network, choose the development strategies and practices most appropriate for your company, and develop and implement a business development plan in a more primitive and practical way.
5- Determine KPIs and the appropriate budget
It is important to identify key performance indicators (KPIs), to help you know if these practices have actually succeeded in achieving the desired goals or not, and accordingly, to determine the extent to which the business development plan has succeeded in its objectives, or if you need to make further improvements.
These indicators can include sales numbers, customer growth rates, conversion rates, or even the number of partnerships. After that, it is necessary to set the budget for the implementation of these activities, while making sure that you have the ability to bear this budget in the company so that your plan is not negatively affected during implementation.
Duties of the Business Development Manager
The Business Development Manager is responsible for developing and implementing the business development plan and works hard with other teams within the company, such as the marketing and sales teams, to figure out how to develop the business in the company. Among the most important tasks of the Business Development Manager:
1- Identify business development opportunities
The business development management process is based on exploring the available opportunities, whether in the current market in which the company operates or in other markets that can be penetrated. Examples of business development opportunities include:
Potential Partnerships: Organizations or people with whom you can partner to develop your business.
Marketing Campaigns: Marketing ideas that can be implemented to contribute to increasing revenue or promoting a specific product.
Cost-saving mechanisms: Companies focus on ways to reduce costs, and one of the tasks of the business development manager is to discover opportunities for the company to do so.
Places to grow and expand: Startups seek growth, as this is one of the basic business development strategies. The Business Development Manager identifies appropriate growth opportunities for the company.
2- Building and developing partnerships
There is no dispute about the value of partnerships as one of the most important business development strategies. So, when potential partnership opportunities are discovered, the Business Development Manager builds them. You can search for partnership opportunities through various networking activities, prepare a list of potential partnerships, then communicate with them and present partnership offers.
The task of the Business Development Department does not end with building the partnership. It is important to maintain its continuity for as long as possible and to be keen to increase the aspects of the agreement by developing other forms of cooperation, such as implementing a joint marketing campaign or working together to launch a new product and others.
3- Get new clients
The primary goal of any company is to generate revenue, and getting new customers is one of the most important ways to do that. So, one of the tasks of the business development manager is to try to attract new customers to the company, and here the manager uses what he needs from different business development practices according to what suits the potential customer.
The task begins with compiling a list of potential clients, reaching out to them to offer your company’s services, and discussing the benefits that the client will receive. At this stage, each customer can be treated according to his capabilities, and appropriate quotations can be provided to him, as it is not a requirement to provide the same price to everyone. This increases the likelihood of a successful sale and includes the opportunity to generate more revenue.
4- Permanent follow-up
Constant follow-up is one of the most important tasks of the business development manager, as he needs it to ensure that work is progressing according to plan. Follow-up forms required by the Business Development Department vary, as they may include follow-up with:
- Potential customers: communicate with them after offering prices to find out their opinions, and answer any inquiries they have, with the aim of converting them into actual customers.
- Potential Partners: Discussing potential aspects of the partnership, and making sure to reach an agreement that suits both parties.
- Existing customers: ensuring that they are satisfied with the service provided, and discussing ways to develop sales to increase the profits achieved from them.
- Existing partners: Ensure the implementation of all the terms of the agreement with the partners, and try to find more opportunities for cooperation.
- Other work teams in the company: Coordinating work with other departments whose work intersects with the Business Development Department, such as marketing, sales, and customer service.
5- Constantly managing the company’s business development
The work of the Business Development Department is based primarily on continuous improvement. Therefore, the business development manager must keep abreast of the changes and developments that are taking place, whether in the industry as a whole, among competitors or even in the current or external markets; With the aim of discovering different development opportunities.
For example, by observing the industry and knowing potential growth prospects in some markets, growth can be directed towards it, to expand the company’s activity and generate more revenues. It is also possible to study recent technological trends, such as the development of marketing automation tools, to focus on switching to using these tools, to obtain higher effectiveness in marketing performance, and reduce costs for the company at the same time.
What are the most important skills of a business development manager?
A business development manager needs basic skills that help him work in this field and carry out the tasks assigned to him in order to successfully manage business development. Among the most important skills of a Business Development Manager:
- Project management to organize work and implement various development plans.
- Plan well to choose the most appropriate development strategies and practices.
- Effective negotiation to conclude appropriate partnerships, win more clients, and get the best deals for the company.
- Analysis to study customers, competitors, industry, and different markets.
- Business intelligence to seize opportunities at the right time.
- Predicting expected changes in the market according to data and information, not assumptions and personal opinions.
- Follow-up communication with all parties such as partners, customers, and the company’s work team.
- Networking to build strong relationships with various organizations and institutions.
- Problem-solving to address any potential challenges during the implementation of the business development plan.
In conclusion, business development can help you lead your company to discover various opportunities for growth and improvement. But it requires good planning, choosing the most appropriate business development strategies that your company needs, and then starting to implement these strategies on the ground with practical and deliberate steps that will lead you to the desired success.