Business Planning – A Good Business Development Strategy is Crucial for Success

As part of my consulting practice, I read and review business plans written both for venture capitalists and for grant applications. The weakest part of every business plan is always how will the company get from today to “the dream” five years out.

Usually, there is a pretty good description of what will happen in the next six months and a decent description of what will happen in five years, but there is nothing in between.

Technical entrepreneurs have a good handle on what product development they need to do to get the product into a usable form. They understand the costs and the time involved. However, once the product is developed, they seem to be at a loss as to what to do next.

The lack of a business development executive early in the process often leads to the product being developed in a vacuum. There is a bit of a chicken and egg problem here: start-ups don’t feel like they can afford a business development person until they sell product and they can’t figure out how to sell a product without business development.

Also, I’ve noted that a number of engineer or scientist CEOs tend to discount the role of business development, as if the science behind the product is really what sells the product. This is just not true – if it was true, universities would be a lot richer.

A company is a machine, each part is equally as important as every other part. For instance, you may have the hottest, top of the line engine in your car, but without tires, the car isn’t going anywhere. And continuing on with the car analogy, you can purchase cheap, junky tires. If you do, your car won’t perform at its best and will eventually crash and burn.

A good business development executive will plot each step of the way how your product will go from prototype to dollars in the bank account. At the early stages of your company, if you cannot afford to hire a business development exec, look for an adviser who has performed the role for other companies and listen to him or her carefully. Your business development plan should include

  • An Assessment of the Market Opportunities – Who is it who might want to buy your product? What do they have now? What is their purchasing cycle? Who at that company actually makes the purchasing decision?
  • Competitive Analysis – Who is trying to sell into the same space? Why is their product worse? Why is it better? Don’t forget inertia as a competitor. As an example, everyone should have a will, but many people do not because they just don’t get around to it.
  • Lead Generation – Once the market is narrowed down, you need a good strategy for how you are going to find the people who want your product.
  • Follow-up Sales Activity – This is broken into two categories, one pre-sale, one post-sale. You should have a strategy for how to deal with potential clients who have been contacted, but are not interested at this time. You also need a strategy for reconnecting with the customers once the sale is complete. Even if you do not think they will need another product from you, they may be able to give you a referral.
  • Pipeline Development – There should always be another customer in the pipeline. Without a strong pipeline of continuous customers, you will be unable to forecast sales and are likely to get caught short on cashflow.

Don’t neglect the business development strategy when building your business plan. If you are planning for five years out, know what you will be doing over the next six months, year, two years, three years, and so forth.

9 Ways Performance Appraisals Promote Business Development

Employee performance is an essential ingredient in any company’s ability to achieve its goals. Therefore managing employee performance is integral to business success. A well managed performance appraisal assists managers to assess and provide feedback to increase the competency of their team members. Developing skills, knowledge, attitudes and increasing team member capability are key objective of performance appraisals. For many businesses performance appraisals results in spending ‘time on the business’ to build capability.

Performance appraisals promote business development in the following ways:

1. Drive business performance

Facilitating performance appraisals means managers making an effort to communicate with their employees. Managers who care about the performance of their people and business will recognise the importance of providing feedback and assisting their team members to grow and develop. The performance appraisal is a proactive HR solution in driving business performance.

2. Improve employee productivity

Assessing employee performance against job expectations provides the opportunity to improve capability and productivity This is achieved by communicating how the person has performed and identifying key result areas (KRA’s) and behaviors s which with improvement will increase capability, productivity and profitability.

3. Identify specific areas for improvement

An effective performance review process will consist of a plan specifically aimed at improving KRA’s and behaviours that have been identified as requiring improvement.

4. Address poor performance

Conducting performance appraisals enables you to talk about performance and behaviour that has been previously identified where improvement has been required.

5. Identify future development requirements

Performance appraisals help confirm employees’ strengths and weaknesses and identify future competency requirements to perform their current or another role. Through targeted development, team members will increase their value to the business as they increase in capability.

6. Make informed employee decisions

Employee decisions regarding improvement, promotion, job changes, and termination can be achieved through the performance appraisal process. The process provides managers with the opportunity to empower and delegate responsibilities to team members.

7. Increase the organisations capability

Performed organisation wide the performance appraisal process increases the organisations overall capability resulting in a competitive advantage – your people.

8. Recognise, retain and reward high performers

Having a strong link between effort performance and reward will motivate team members. Performance appraisals provide a HR solution which can be linked with intrinsic and extrinsic motivation methods, resulting in increased team member engagement and capability.

9. Improve profitability

Having a more capable, competent and motivated team will improve communication, productivity and ultimately profitability.

Businesses that see performance appraisals as a strategic method to develop employees benefit because the added competence further develops the organisations capability, competitiveness and sustainability.

Facebook Role in Business Development – The New Face of Business Marketing

Business and community since ancient times, have correlated on a common platform, which has given way to collaborations, conglomerates and the corporate. From old-time barter to trade, the link to business was through communities. Tapping the same potential in the internet world are social networking sites such as Facebook.

What is Facebook’s role in business development?

The internet has helped business to assume global dimensions in the initial stages itself. What would have traditionally cost a colossus in terms of over-the-sea advertising, or trans-border marketing has now become much cheaper, with the evolution of the internet technology. It is not only the cost effectiveness but also time-zone-transcendental phenomenon of the “I” power, which helps you remain ‘connected’ always.

Now with such a scenario presented in the internet space, social networking sites such as Facebook helps you connect to serve your business interests. With a user-base of more than 61 million, there is a wider reach to business-profiles, entrepreneurs (budding and established), whom you can reach through the site.

In a way, social networking sites can give a jumpstart to your business if you have the directions and pointers right, and such as the ones like Facebook, can play a strategic role in business development in length, breadth and depth.

The first step is that of creating a profile for your business. Before you go about launching your business profile on Facebook, you need to frame your key marketing strategies, as to what are the objectives you desire to achieve for your business, and the scope of your business performance and your business viability in the online medium of marketing. Once you have these parameters defined, you have the foundation of a business profile, which you can build by employing some of the custom tools in Facebook. Some apps can also be downloaded as according to your business requirement. When you have the framework ready, you need to establish links/contacts for this framework, so that your business community expands or links to other businesses. There are sophisticated features and advanced search criteria in Facebook through which you can search for business contacts or get in touch with hi-profile business people. As the key to expanding your Facebook base it is imperative to create a profile which is attractive, authentic and achieving. As the first impression to a prospective business partner or a customer, your business profile is the first window of opportunity within the community of Facebook users and outside the boundary of the site as well. Your profile can be projected as a business badge in other networking sites, blogs etc.

From being the ‘face’ of your business profile, Facebook role in business development can be substantiated through various apps such as MyBox, Business cards which can be downloaded from the site. Apart from these, features and tools such as creating events, or writing notes or announcements about strategic business developments will help in maximizing your business potential; by being a medium of advertising and a platform for joint-ventures with other business of common interests.

Facebook has features to list out priorities for your business. You could categorize your friends’ list as top friends, blog friends, with socialistic apps, interactive friends graph, and apps for free conference calls. In view of establishing a communication interface and therefrom a platform for interaction, association and partnership, Facebook’s role in business development is significant. Additionally, there are also RSS feeds and email alerts utilities which you can customize for your business purpose.

Business is all about brand building. The techniques and ethics you would employ in real-time scenarios namely credibility, authenticity, commitment, a die-hard passion for growth, ambition is what you would need to project in sites such as Facebook, with the apps and utilities available. You need to translate projections into performance and make trust a very much existent element, in the extensive yet vulnerable web medium.

Business Development Strategy for Managers

Senior Managers have different contacts and networks from the rest of the company. Their contacts are of a higher level. It is important that Senior Managers build their profile and have a planned strategy to work their network in order to get more business. Even Managers in Accounts and HR will have, or should have, a network of counterparts within other companies. Every Manager should see it as a part of their role to be proactive in working their network and contacts to build stronger relationships or gain market intelligence that could lead to new business.

This can not be delegated to someone in a lower level within the company as their contacts and network will be at a lower level of authority.

A strong network with regular contact within client or joint-venture companies, will ensure:

  • You learn market intelligence early
  • You learn about changes within the client company
  • You learn about new projects earlier
  • You learn about on-going problems which you may have solutions for
  • You are up to date with arrivals of new people or replacements
  • Your relationships will strengthen

When you have a planned strategy, you leave nothing to chance and do not have to rely on memory, skill or inclination. You will be in the right place at the right time to offer ongoing support and create added value to the client.

There should also be a budget allocated for Managers to take clients to functions, lunches or coffees. Plus there should be KPI’s to measure the networking activities and the annual results.

How Is this Done?

Each Manager makes a list of clients and segments them by priority such as Gold, Silver and Bronze. The goal is to strengthen the relationship and get more work from Gold.

Gold would be an existing active relationship and a significant amount of work. The goal with Silver is to move it to Gold, and move Bronze to Silver.

Occasionally, you will drop clients from your Bronze status and put new clients into this segment. Companies grow and change either through natural growth or through merger and acquisition.

Once a client has been allocated into a segment, each Manager must make a decision about the frequency of the contact, the type of contact and the manner that suits them. The company may set a Matrix with set frequency for each segment. If the contact is decided to be monthly, then within a quarter, you may have a coffee meeting one month, contact by email another month and invite them to be your guest at a business breakfast the next month.

Functions ideal for inviting clients

I recommend that you subscribe to a paper with a strong focus on business. They will promote breakfasts and functions that would make great opportunities to invite clients to attend as your guests. Other opportunities are charities which have business breakfasts or speakers and Chamber of Commerce functions.

Networking

The ultimate objective of networking is to meet new people with the intention of either converting them into potential clients or to establish ongoing relationship. So, simply meeting them is not enough, you have to know firstly how to meet them and how to start a new relationship and how to keep it going.

It is important that all Managers learn how to network effectively. Therefore, they either need training or operations manual modules that cover the following:

How to network effectively when you know no one in the room

How to work a room, how to approach a group of people you don’t know, what to say, how to move on and how to connect quickly and be remembered.

The business card system

How to follow-up by email or phone call.

What to do prior, during and after the function to create new relationships

Making Contact

How to make a call when you have nothing to say

How to make a ‘cold’ call where the person willingly agrees to meet

How To Build and Maximise your Profile

Strategies to build, maximise and extend your network

Shared Information

The final part of this strategy is the sharing of the information gained. This can be an informal process but this is often not shared with all the people who could take advantage of the information. Managers should share in their weekly Management meetings, any market intelligence or change in the companies they are in contact with. This would then be filtered down to other levels where they could use this information as a reason to make contact with their network. Again, this works best as a formalized process.