The Business Development Executive: Strategic, Customer-Focused, & Driving Growth through Sustained Action
The term business development is ambiguous. Does it mean to “develop a business” by helping it define its marketing and product development strategies or does it mean to “develop business for a business” by increasing its sales, revenue, and profitability? If the answer is all these things, as it in fact is, how does the Business Development executive go about making this happen? The answer to this last question is multifaceted.
A Finger in Every Pie
Most senior executives, directors, and managers largely concentrate on a single business function, such as Finance, Operations, Product Development, Sales, or Marketing. The Business Development executive’s responsibilities, however, span several, and, most often, it is the three latter. Depending on the industry and business model of the company and on the executive’s professional background, a greater emphasis might be placed on one over another, e.g., Marketing over Product Development or Sales over Marketing. Whatever the mix, Business Development leaders are generally focused on three things: the company’s products or services, its customers, and how its offerings might best meet customer needs.
This is because Business Development’s primary mandate is to grow the business by the most effective means possible. Usually, the optimal ways to do this are by increasing sales of existing products and services to current customers, initiating sales of the same to new customers, or developing new offerings for sale to both. This formula is a basic of business. However, like much common knowledge, it’s one thing to be aware of it and another thing to have the capacity to act on it and reap the benefits. Having such capacity entails truly knowing one’s customers and how to sell to them. Typically, Marketing acquires such knowledge on a macro level, through secondary market research, whereas Business Development acquires it on a micro level, through personal interaction. To do this, a company’s Business Development team must be adept at both qualitative and quantitative analysis. What’s more, its members’ backgrounds should include significant exposure to the sales process. Finally, the team’s leader should be at once tactical and strategic, a rigorous performer who is nonetheless flexible enough to be opportunistic when circumstances warrant.
Jack of All Trades as Well as Master of Many
Perhaps more so than the head of any other customer-facing function, the leader of Business Development needs to have a strong handle on multiple aspects of the business. Ideally, he or she must have or develop a deep familiarity with his or her company’s industry, in-depth knowledge of the features and benefits of its offerings compared to those of its competitors, a thorough understanding of its customer’s needs, and the ability to transform all this into a plan that outlines what products and services are optimal for what customers in the present competitive environment and which might need to be evolved or newly developed to meet likely future requirements.
Depending on the complexity of a company’s products, e.g., industrial machinery or enterprise-wide software versus professional services or consumer products, fulfilling the above responsibilities calls for an individual who feels equally comfortable in the Sales and Product Development spheres as in the areas of Market Research and Marketing Communications, since Business Development must draw upon all of these functions in order to fulfill its own mission. For instance, in order to keep a finger on the pulse of the market, Business Development in a manufacturing company typically reviews secondary research and conducts its own primary research via contact with select customers or prospects, and then acts upon its findings to influence the modification of existing products, spur the development of new offerings, and help shape the company’s product messaging. Just as importantly, Business Development uses the customer and prospect relationships that it builds in the course of these activities to increase sales and grow the company’s top-line numbers.
Sales Versus Business Development
Business Development’s role in the sales process bears further discussion, since the function is not really part of Sales but certainly of it. This means what, exactly? Simply, that, as its name implies, a large part of Business Development’s role is to secure and to develop new business that will have a significant, positive impact on the company’s long-term growth prospects. The Business Development leader and his or her direct reports pursue this objective via a variety of methods. For example, in capital-equipment manufacturing companies, they do so by working with Sales to identify key customers for participation in Product Development’s Voice of the Customer initiatives, a process whereby customer input influences modifications to existing products and the development of new ones and that frequently leads to additional sales to the participating customers. In professional service firms, Business Development is not much involved in defining service offerings but instead in business prospecting. For example, targeting high-value clients and nurturing relationships with their decision makers, such as a Marketing vice president responsible for hiring ad agencies, and key influencers such as a Corporate Counsel who weighs in on the selection of strategic service providers such as management consultants or executive search services.
While the above-described responsibilities often overlap with Sales activities, particularly key-account initiatives, they differ in one very important aspect: Business Development’s customer-relationship and market development work usually has both a long- and short-term horizon (i.e., a focus on immediate and future sales potential) and is also global rather than regional in nature. By contrast, Sales usually concentrates on making its monthly, quarterly, and annual sales targets and is often more focused on territory sales growth rather than on specific account penetration and expansion, a difference that sometimes renders the function more tactical than strategic.
Does My Company Really Need Business Development?
On its face, this might seem like a rhetorical question, since just about every company needs to develop its business. However, less literally interpreted, it’s a valid query, since the true question here is “Does every company truly require a Business Development function?” If yours is a B2B company whose business is characterized by high-dollar sales to identifiable corporate entities with significant lifetime value, the answer is yes. If, on the other hand, you’re in the retail business and sell to large swathes of the general public, additional resources dedicated to mass and segment marketing would probably be a better investment. Potential exceptions to this last advice are businesses in which third-party influencers/endorsers have great sway over the final decision makers. A B2B example would be a manufacturer whose external legal counsel recommends an accounting firm that has worked for other of his or her clients or an IT services provider that vets a proposed marketing software purchase for compatibility with a company’s other software solutions and its network. In the consumer space, third-parties with sway range from celebrity endorsers in broadcast and print media to “influencers” with large followings on social media platforms such as Twitter and Facebook.
What Does the Ideal Business Development Executive Look Like?
As the above suggests, the background of the ideal Business Development leader should likely include a stint in Sales, significant exposure to Marketing, an understanding of Product Development, and, depending on the nature of your business, possibly industry experience. He or she should be sufficiently analytical to understand and act on market data. He or she should also be intuitive and polished enough to know how to develop and manage one-on-one relationships with high-potential prospects and to effectively interact with the leaders of peer company functions such as Sales, Marketing, and Product Development, as well as top management. Perhaps just as importantly, the Business Development executive should be highly personable and proficient at making new contacts, cultivating relationships with prospects, and general networking, since a good part of the role has to do with pursuing and capitalizing on referral-based business. Finally, the Business Development leader should be good at public speaking, as he or she will likely have to make company capabilities presentations before customers and prospects as well as speak at trade shows and industry conferences.
How Can I Find a Skilled Business Development Executive to Help Grow my Business?
There are probably as many ways to find a Business Development Executive as there are different sorts of professionals from Sales and Marketing backgrounds who have the talent and skills to be one—which is to say, enough ways, but, in the end, maybe not all that many. The principal ones include the following:
- Internal promotion
- Talent acquisition on the part of your internal HR function
- Informal recruiting by executive and senior management among their business connections and circles of acquaintance
- The use of executive search services experienced in filling such positions
The first course of action is likely to result in candidates who have the advantage of being familiar with your business but whose frame of reference might also be limited by it. The second way might well be effective but adds to the workload of the HR function, particularly if, as in many small- to medium-sized companies, the department does not often have to fill executive-level vacancies. The third method will doubtless surface interesting candidates, but the task might distract executive team members from other pressing responsibilities and, worse yet, runs the risk of tipping off the competition. The fourth method, the use of an executive search consultancy, might at first glance seem more expensive than the other options, but, when one pokes beneath the surface, this initial impression might prove inaccurate. There are a number of reasons for this.
A reputable executive search firm typically has access to third-party databases of potential “passive” candidates (i.e., qualified leaders who are not actively seeking new employment) and extensive executive contacts, as well as a proven, repeatable search process. The best search consultants will employ competency-based behavioral interviewing to assess candidates’ functional knowledge and, if they themselves have worked in Business Development or a related area like Sales or Marketing, will also draw upon their own past work knowledge to evaluate candidates. Finally, such firms will carefully vet candidates to determine whether they share your company’s core values and are a good fit with your company’s culture. So, in the last analysis, the out-of-pocket cost of hiring executive search experts will probably be outweighed by the benefits. The Business Development leader that you hire will likely play an important role in your company’s future growth and, in the end, it’s hard to think of a better investment than one in your organization’s future.
This is the latest entry in a series of articles that examines the characteristics and experience that employers should expect to find in candidates for executive and senior leadership positions in mission-critical functions such as corporate communications, marketing communications, business development, digital marketing, product marketing, loyalty marketing, direct marketing, and public relations, as well as sales and other types of channel management.
To learn more about Torch Group’s Sales & Business Development Executive Recruiting practice click here.
For comments or for more information, please contact:
Customer and prospect contact: Ronald S. Torch, Founder, Chief Executive Officer, and President, the Torch Group, email@example.com, www.torchgroup.com, 440.519.1822 x101. Media contact: Ronald-Stéphane Gilbért, Senior Consultant & Global Managing Director, Gilbért, Flossmann & Zhang Worldwide, firstname.lastname@example.org, www.globalmarcomm.com, 216.816.4947
- Posted by Stuart Glassman
- On December 7, 2017
- 0 Comments