Business development is a very common term we hear in business organisations. When people claim that they do business development, what do they actually mean? Some say it is sales, some say it is building relationships with customers, market development or business expansion. We just get a vague picture with these assorted words.
But what exactly is this business development?
It can be described as a set of business strategies, tasks and processes that aim at developing the business. The Grand Unified Theory of Business Development defines it as “the creation of long-term value for an organisation from customers, markets and relationships”. Business development leads to increased growth of the business, increase in revenue and profitability as a result of strategic business decisions and partnerships.
Is it the same as sales?
Sales and business development are being used interchangeably in many organisations these days. The previously used Job roles of Sales are being improvised as Business Development Executive. But these are two different terms . It is more of a marketing function that a sales function. The sales function is directly reaching out to your customers, but like already mentioned, business development is going through partnerships to reach out to your customers. Sales and Business development are regarded as two faces of business, that need to function alongside for the growth of the business.
What are the areas that business development covers?
Generally speaking, Business development is an umbrella term that covers a large number of business activities like new product development, channel sales, exploring a new business like, strategic marketing, mergers and acquisitions, Partnership development etc. Any function that will create a long-term value to the business is actually a business development function.
What makes business development all the more interesting as well as difficult is the fact that there’s no template or a formula to make it work! You need the perfect ‘Biz Dev’ team to actually come out well. This is one of the reasons why many organisations are so bad at business development! They just don’t have the confidence to make concrete strategic decisions in the fear of committing mistakes.
Either the business owner or employees can be business developers. They should be people who can make or suggest a strategic business change for a value-add to the business.
It may seem vague in the description because it is more of a practical function. Having an open mind, willingness to accept and learn from mistakes, clarity of thought, versatility are some important elements for successful business development. The final output of the business development is what matters in the end. There are no pre-defined procedures involved . Be ready to experiment with various approaches to see which one actually leads to long term value addition to your business.