The document provides recommendations for establishing a Business Development Group (BDG) within an organization to better coordinate efforts in developing new business opportunities. It discusses restructuring the organization to separate short-term sales from long-term strategic development. The BDG would focus on opportunities with a 2-3 year horizon, leveraging cross-functional virtual teams to improve information sharing and decision-making.
1. Best Practices in Business Development presented by David Fatlowitz July 2009
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4. Today’s Typical Sales Dept Structure (Company X) ‘ Military Style’ Top Down Command & Control “By Decree you will…” Add’l mngmt layers Little co-ordination with other depts, focus mainly on closing deals … VP ASM West ASM Southwest ASM North ASM Southeast ASM Northeast Regional Acct Execs Regional Acct Execs Regional Acct Execs Regional Acct Execs Regional Acct Execs Eastern Regional Sales Manager Western Regional Sales Manager
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7. Result: Projected Sales Revenue (Company X) Opportunity Cost = $ 57M Gap ! $ Millions Stretch Goal = $280M Based on current market opportunities alone falls short of the target…
8. Growth expected only in top market, otherwise little revenue growth or diversification expected over next 3 years … Example: Projected 3 Year Sales Trend Business Development Motivation (Company X)
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13. Business Development Group Guiding Mantra: Key Lever: Virtual teaming “ Everyone works in Business Development” Focus: Opportunities with 2-3 year horizon
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16. Creating Value in New Markets combining resources and capabilities creates new competencies and beneficial outcomes… Takeaway: Need to spend sufficient time on this ! A clear plan demonstrates strong commitment to customers in new markets not presently served… New Competencies Competitive Advantage Value Creation Above Average Returns Valuable Ex. save customers time to market Rare Ex. Industry expertise Costly to Imitate Ex. Highest production capacity Non-Substitutable Ex. Unique combination of products & services
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19. 1: ? 2: ? 3: ? 4: ? 5: ? BDG 2 3 4 5 The five key elements for successful organizational change… 1
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21. New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) Regional Sales Mngr Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept
22. New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) Regional Sales Mngr Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept entrepreneurs with alliance and deal building skills…
23. New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) Regional Sales Mngr Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept entrepreneurs with alliance and deal building skills… extensive market knowledge & BD experience
24. New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) Regional Sales Mngr Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept extensive market knowledge & BD experience well connected at CXO level with thought leaders & major industry players entrepreneurs with alliance and deal building skills…
25. BDG: Segments Sales Activity… President VP Finance VP IT VP Technology VP Sales Finance Dept IT Dept Technology Dept Sales Dept ISE’s, SE’s, ESE’s Regional Sales Mngr Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept PM’s, MarCom, Other Sales & Marketing focus on “mature” & tactical opportunities ready to bear fruit BDG concentrates on strategic “horizon” opportunities that need focus & nurturing… Key Message: EVERYONE works in business development, participation is thru BDG projects…
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27. PM, RM, BDM Roles PM POR M1 M2 M3 M4 M5 R2 R1 R3 R4 R5 PM’s WIG: Sell P roducts into as many markets & regions as possible… Finance Marketing Sales Products
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29. PM, RM, BDM Roles PL3 M1 M2 M3 M4 M5 ROR PL5 PL2 PL1 PL4 RM RM’s WIG: Grow sales in Region by selling all products into as many markets as possible… Finance Marketing Sales Products
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31. PM, RM, BDM Roles PL3 MOR PL5 PL2 PL1 PL4 R2 R1 R3 R4 R5 BDM BDM’s WIG: Grow sales in Market by selling all products into all regions… Finance Marketing Sales Products
32. requires embracing teamwork, sharing decision making & overlapping responsibilities… PM RM BDM Reaching the Pot of Gold… Opportunity Finance Marketing Sales Products
34. Business Development Group New Market Projects (near & long term targets) NM 9 NM 8 NM 7 NM 6 NM 5 NM 4 NM 3 NM 2 NM 1 BDG
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36. Company X: BDG Benefit Example (Projected Revenues) ~ On target $ Millions Stretch Goal = $280M Rev C = Today + Tomorrow + BDG Rev B = Today + Tomorrow’s Pipeline Rev A = Today’s Customers Only
37. STRATEGY: ? STRUCTURE: ? Collaboration and share responsibilities among subsidiaries on global accounts & opportunities INFO & DECISION MAKING PROCESSES: ? REWARDS: ? Outsourced Sales: revenue recognition for subsidiaries that initiate new business PEOPLE: ? BDG Future: Global BDG (networking with subsidiaries)
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39. BDG Implementation: Best practices in driving culture change… To UN-FREEZE… To EXECUTE CHANGE… To RE-FREEZE… 1 - Communicate need for change Redefine top metrics & rewards to establish credibility Monitor acceptance & make adjustments 2 – Implement change initiative 3 – Reinforce new culture thru symbolic actions