business development manager 101

Business Development is a mysterious title for a little discussed function or department in most larger companies. It’s also a great way for an entrepreneur or small business to have fun, create value and make money. Good business development allows businesses to profit by doing something that is tangential to their core mission. Sometimes the profit is so good, it becomes part of their core mission, other times it supports the brand and sometimes it just makes money. And often it’s a little guy who can be flexible enough to make things happen.

Seth Godin also highlighted:

The thing that makes business development fascinating is that the best deals have never been done before. There’s no template, no cookie cutter grind it out approach to making it work. This is why most organizations are so astonishingly bad at it. They don’t have the confidence to make decisions or believe they have the ability to make mistakes.

Those words resonated with me as I found myself in the position of leading the business development of a tech startup.

If a proper deal is found, business development can make your organization successful overnight.

But searching and finding deals and executing them successfully feels like a gold rush.

Therefore, to make business development work, it is necessary to make it a process.

The process needs to be focused on understanding how to drive value for your organization by leveraging partnerships that can bring your business to the next level.

Business development is also about leveraging and tweaking your existing business model to make it scalable.

When Google closed the deal with AOL overnight Google, a rising star, could be featured on the largest online portal.

Before moving forward, it is essential to understand the difference between business development and sales.

Business Development vs. sales

Thinking about the business developer as the sales guy, it’s limiting. Not that a business developer doesn’t sell, but it does so by creating a distribution .

In other words, rather than looking at a single sale, the business developers try to find sales channels to tap into to speed up a company’s scaling.

If that means selling a product or a service directly, the business development person will temporarily become a sales guy.

Imagine the scenario of a company that has no clients. In that context, a business developer must find the first clients as quickly as possible.

Those clients will serve to launch the company’s growth, while the business developer will look strategically at ways to have those clients become partners.

Therefore, all of a sudden, a few clients become your distribution channel.

Even though the business developer acted as a sales guy from the outside, he never lost sight of the long-term strategy .

The successful business developer thinks like a marketer but acts like a salesman

Business development is a mixture of sales and marketing .

In many cases, a business developer will use marketing and PR activities to establish critical relationships for the business.

Those relationships will become partnerships to generate new distribution channels .

business-development-mixture-marketing-and-sales

Business development is about nurturing the right relationships with partners that can become distribution channels

Where the sales process ends up with a closed deal.

The business development relationship starts with a closed deal.

The business developer knows that a deal closed is just the starting point of a long-term relationship that can impact the business in the long run.

Therefore, the business developer will translate that paying customer into a trusted partner and an advocate for your business.

Thus, a sales person thinks in terms of the client by client basis. The business developer must switch the thinking to what sales enable a snowball effect on the company’s bottom line.

For instance, some clients will refer to other clients, enabling word-of-mouth.

In another case yet, closing a deal with a known player also means having that publicity that is necessary to bring in other customers.

Thus, the business developer understands that to succeed, it’s critical to have a long-term view of each deal.

Where you don’t want to optimize for short-term gains on a single client but rather create a strong position in the market.

That is why the business developer is a sales person at the core, yet she/he also needs to deeply understand the product and how to talk with technical teams while aligning marketing teams.

All while making sure to keep these teams aligned with the customers’ business goals.

That is what a top-performer business developer does.

She/he aligns the technical/product team, with the marketing team, while relentlessly working on making sure product and marketing are in line with the customer’s business goals.

When you master the above as a business developer you become one of the most valuable people in the organization.

Business development guides marketing automation

Marketing automation is a powerful tool for any business. However, marketing automation is also risky.

Indeed, automating processes requires a deep understanding of your customers.

Thus, before you can automate the marketing processes, you’ll need the business developers to help the marketing team structure those processes.

Indeed with unique insight into the company’s customers, the industry, and competitors, the business developer will advise the marketing department on how to structure and set up automation processes that fit long-term organizational growth .

In fact, one of the greatest pitfalls, especially for startups, which try to automate processes very early on is premature optimization .

The business developer is the person within the organization that understands how valuable is the interaction with the customer, especially in the early days.

Therefore, the business developer will know that, over time, business processes must be – in part – automated.

But she/he will be the guardian of the interactions with customers, making sure that the company doesn’t fall into the trap of premature optimization.

Indeed, initially, to be able to grow, the company must leverage, as much as possible, interactions with customers.

Therefore, part of the organization, like customer support, rather than being automated, or optimized, should be highly expensive (meaning the top people should be devoted to it), as, from these interactions, you will get a wide range of feedback that will be critical to speed up growth, through iterations.

Business development scales up businesses

When Google closed its deal with AOL , it was a turning point for the tech company that would become a unicorn first and a tech giant then.

It started with a business development activity that allowed Google to build a partnership with AOL and kill its competitors!

A successful business development person is a quick learner and a renaissance man.

He will be able to learn about as many disciplines as needed to have a deep understanding of the industry that will drive the company’s growth.

For instance, if you think of a business developer in the digital marketing world, he’ll probably be someone that understands SEM, SEO, funnel optimization, content marketing , sales, and all the other channels available to grow a business .

But at the core, the business developer will remain a salesperson, thus, she/he understands that those channels are instrumental to building up distribution power.

Thus, creating options to scale .

Business development is about a growth mindset

The business development process could vary greatly based on the industry, business model , and stage of maturity of a company.

If you are called a business developer for a startup, most of the activities will be connected to growing the startup and bringing it to the next growth stage.

Therefore, the successful business developer needs to have a fine-tuned mindset for growth.

In business, it’s often called 10X mindset or moonshot thinking .

Yet, it doesn’t matter what you want to call it, what matters is you know that you need to work hard, extremely hard today, and do that consistently to build an incredible business.

In fact, one of the major misconceptions in the current business landscape is that of believing that you can build a successful business quickly.

While that might happen to a few, very lucky ones.

Developing an incredible business, takes time, hard work, consistency, and a five-ten years timeframe.

That is why it’s critical (if you want to become a top performer) to like what you’re doing.

From that standpoint, a tool like the Bud Caddel Diagram might work to assess whether you’ll make it on the other side, from amateur to top performer.

Business development requires a high level of understanding of a potential partner

To be able to build a relationship quickly, a business developer has to understand the business dynamics of a potential partner.

Indeed, just by tapping into the economics of a partner, the business developer can craft the perfect deal/solution.

For instance, when Google proposed the deal to AOL , it was so good for AOL, and it had no risk for them that they couldn’t say no to it.

Yet AOL was an established network, which allowed Google to get into the next stage of growth and scale.

Understanding what deal can build up distribution is critical. As it enables the company to build momentum and follow a flywheel model of growth .

And growth moves from linear to exponential, and that is how the business achieves scale.

What activities does business development imply?

Anything that helps build up a solid distribution strategy falls into the business development processes.

Tasks of a business developer can range from basic sales calls and LinkedIn/email outreach to closing major deals.

What tasks you will be performing daily will depend on whether you’re a top performer within the organization and at what stage of development the company is.

For instance, for a new company/startup, building a sales pipeline in the first place is critical.

And outreach becomes a key component of day-to-day activities.

You’ll spend most of your time identifying potential prospects and reaching out to them to build momentum in the sales pipeline.

For that matter, you can use methodologies like MEDDIC to identify the right prospects.

Or the BANT method .

Or yet the CHAMP method .

Whatever methodology you pick, what really matters is consistency and the understanding (as you ramp up the outreach) of the market’s landscape.

Once that is full, and you have enough deals coming through, you will focus on consolidating these deals and ensuring those reach the maximum potential.

Especially at an enterprise level, before the full sales cycle matures, it might take 1-3 years.

In that process, you’ll need to outreach, onboard, grow and consolidate the deal.

And depending on the deal size, the revenue you’ll be able to bring in from a customer will highly depend on your ability to consistently work to understand the changing business goals of your customers as their organizations change and evolve.

You will act almost as a valuable player within the customer’s team; only then you’ll be able to really grow the deal size and fully consolidate the potential contract value of the customer.

For instance, if you take organizations like Palantir , which work, on huge government contracts, to develop those fully, the enterprise salesperson will follow a 2-3 years journey of the development of the contract.

The sales pipeline is a basic tool for a business developer

A sales pipeline is as a visual representation of your sales process where all your potential customers are displayed and neatly arranged according to their phase in your sales cycle. Source : salespop.pipelinersales.com/sales-professionals/what-is-sales-pipeline

A business developer has to be able to build up predictable sales processes to generate continuous streams of leads for the organization.

The sales pipeline is a valuable tool for setting up those processes.

Also, being able to track your sales pipeline is a critical activity.

A sales pipeline is just a way to have a clear in which stage of the sales process you are with a potential client.

As shown by Sales POP , from the initial contact to closing a deal, it takes a few steps:

At each of those actions, we can assign a probability of closing a deal.

For instance, at the initial contact, you don’t have an idea whether the person you’re reaching out to would later become a customer.

Therefore, the more you move down the pipeline, the more the chances of closing the deal improve.

Sales POP research shows that each of those stages has a chance of success as follows:

Therefore, you have 1 in 10 chances of closing a lead after you have qualified.

Once you have met, defined the project, and sent a proposal, your chances will improve up to 60%.

The chances of closing a deal also depend on other factors. For instance, have you previously worked with this person?