What The Hell Is Business Development?
Updated: Jan 20, 2020
Within start-up culture, it’s sexy to talk about Biz Dev. But within that same start-up culture, there isn’t much of a consensus on what “Biz Dev” actually means.
Lots of words have been written in an attempt to explain the process of business development. Some use it interchangeably with “sales.” Others refer to it as a function that relates to marketing. And the more progressive thinkers refer to business development hybrid between sales and marketing with a focus on growth, long-lasting value, and partnerships.
But I would argue that Biz Dev is best described as the organization's Moonshot Factory -- and the business development process is driven by the art of connecting the dots.
You’re probably thinking, “Great, let’s all just start making up different definitions by pasting meaningless words together…”
But it’s important to me that we remain friends. So let’s take a closer look.
Organic vs. Non-Organic Growth
The good news is that there’s a standardized, agreed-upon definition for business development: the creation of long-term value for an organization from customers, markets, and relationships.
Essentially, the business developer deals with achieving long-lasting and sustainable growth by non-organic means. Sales and marketing achieve growth organically and focus mostly (but not only) with the immediate value, while business development focuses on long-term value.
"Organic” growth is fueled by the product’s defined purpose and market fit; “non-organic” growth is fueled by the implementation of “growth engines” that create partnerships with tangent factors, facilitate the exploration of new markets, and keep the door open to the development of new possible purposes for the product or service.
Let’s take a cafe for example. To focus on organic growth, we would search the geographical market for places where the demand for coffee is unanswered (either by volume or by quality), open a new branch, launch a new beverage or flavor according to the local palate preferences, and use marketing to reach our target audience.
If we focused on non-organic growth, however, we would reach out to an ice-cream manufacturer, partner with them in order to produce a coffee-flavored ice-cream with our brand name on it, and distribute it through a supermarket chain that has a presence in markets we don’t.
The power of non-organic growth aka Biz Dev
If we’re AMAZON (back in the day when they dealt only in books), organic growth would be securing as many publishers as possible, forming a very efficient supply chain, and raising awareness for the possibility of ordering physical books through the internet through marketing. “Non-organic” growth would be the acquiring of Audible – allowing a new market, namely people who prefer listening to books instead of reading them, access to our primary product.
It’s clear: long-term, non-organic growth is where it’s at. Biz Dev builds empires.
It’s enough to look at the incentives organizations offer to the team members driving different growth strategies. It’s common that sales and marketing departments provide bonuses by quotas, a percentage of deals, and in general, will measure progress periodically.
But when an organization offers a business developer one of these incentive types, the organization misses the point entirely. In mature, established companies, the business development department should resemble a young and agile start-up, no matter how “corporate” the rest of the organization is. The Biz Dev manager should be the driving engine of the company's non-organic growth, continually searching for radical deviations in the product’s initial, stated function.
The Moonshot Factory
In order to explain the importance of treating your Biz Dev department like a start-up, let's talk about Google's "X - the moonshot factory.”
X’s moonshot factory mission is to invent and launch "moonshot" technologies that aim to make the world a radically better place. A moonshot is defined by X as the intersection of a big problem, a radical solution, and breakthrough technology.
The term “moonshot” is meant to describe the scope of the X team’s aspirations. It’s also derived from Norman Vincent Peale’s famous quote, “Shoot to the moon. Even if you miss, you’ll land among the stars”.
To fully understand the company’s mission, I strongly recommend watching a TED talk by X’s CEO, Astro Teller (also referred to as the “captain of moonshots”). From a bystander’s perspective, his team looks like a crazy scientist’s caricature. But they actually have a very effective validation process.
With a far-reaching vision and a rigorous validation process, the Moonshot Factory has the potential to produce some of the most ambitious (and profitable) projects the modern world has ever seen. The self-driving car as an example.
The business of BizDevness
Now let’s come back to the business of BizDevness (see what I did there?)
To provide an organization real competitive edge, produce substantial growth, and achieve the “creation of long-term value for an organization through customers, markets, and relationships,” the business developer must adopt the Moonshot Factory’s perspective. None of humanity’s significant breakthroughs came from conventional thinking - It’s a cliché, I know, but it is the truth. And it is vital for organizations that support a Biz Dev department to follow suit.
The thing is, achieving these “moonshots” is a creative process. It’s an art. And anyone who was ever engaged in a creative process knows that in order to produce good art, you can’t follow a defined procedure.
But there is a methodology.
The art of connecting the dots
Think about the times you had your greatest, craziest idea. It doesn’t matter if you acted upon it or forgot about it after five minutes. We all have these moments.
Where were you when you had this great idea?
For most of us, they come at a certain "Eureka!" moment. We aren’t sitting at our desk, performing our daily job; These moments happen when you're out on a run, taking a shower, trying to fall asleep, or even when you’re sitting on the toilet engaged in the art of pooping.
And then, when you least expect it, while you are busy thinking about something entirely unrelated, a line is stretched from one point to another point.
Two dots are connected.
This connection between two dots is only the beginning of the business development process. But this connection is the foundation on which moonshots are built. This is the first turn of the wheel that sets everything in motion. Without this moment, there is nothing. This is precisely why the greatest business development moves can't be duplicated. Because these moments are singular and unique.
And if this sounds like something you’ve read in a piece about entrepreneurship, that’s because the function of business development in an organization should have everything to do with fostering the entrepreneurial spirit.
Think about any business lifecycle; It’s that entrepreneurial endeavor that establishes the business. And then there’s the growth stage.
History shows us that competition will always arise (unless you are part of a business that relays on some kind of resource which you managed to monopolize), whether as a more innovative company or a company that manages to optimize its supply chain, thus offering a superior service or product. And it’s the same reality for your local coffee shop and the almighty Google.
The three stages of good Biz Dev
After a business captures its potential market and embarks on its growth stage, if it falls into stagnation, it will stay there until its inevitable slip into irrelevancy. Every company needs a business development function in order to complete the circle and to systematically execute initiatives that will ensure non-organic growth.
One-third of a good business developer’s day is dedicated to maximizing the factors the inspire these “connecting the dots” moments. And make no mistake, there is a way to immerse yourself in enough "dots" so the connections naturally happen, and we’ll discuss it in the next post. The other two-thirds are all about making these connections a reality by validating the assumptions behind these ideas and executing them.
Business development is a process that involves three different stages that are equal in importance, but are built one on top of the other:
1. Connecting the dots
And if one of these three bricks isn’t strong enough, the entire tower topples.
The good news is that 90% of the business developer’s work is based on a proven methodology for executing each of these stages. In upcoming posts, we’ll explore the ways to execute each step successfully. And in between, we’ll explore the magic 10% that differentiates good business developers from irreplaceable ones. Stay tuned.
In the meantime, I would love to hear from you!
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