If you’re like most organizations, several things are happening at a rapid pace during the first quarter of the year. For one, you may be into the weeds on completing the year-end process and reporting. However, you’re probably going to shift very quickly into activating your growth strategy for 2016, if you have one.
Within your growth strategy, perhaps you’ve identified a new market of growth opportunity for your brand or business in 2016?
If yes, let me pre-warn you – identifying new markets and accessing new markets are two vastly different challenges. As you move towards accessing and ultimately, activating a new market(s), there’s a very important capability you need in the arsenal.
It’s not only the difference maker in market expansion, but it’s simultaneously one of the most misunderstood areas of business. Many organizations have recently started adding business development to their org charts, but are a long way from leveraging it to drive long-term value creation.
Let’s start with what business development is NOT:
It’s not sales. It’s not ‘strategic accounts’ of any kind, or a special sales role for hunting new business. It’s not marketing or ‘strategic marketing’ either. It’s certainly not R&D. And, it’s definitely not a place to lump a litany of random projects or haphazardly umbrella and ‘title’ certain talent in your organization that does not fit your existing structure.
So what is it, exactly?
It’s a deliberate function, process, and position(s) in your organization that’s charged with charting your course into new markets. It’s should be part of your leadership team, too.
Above all, it’s an art. Here is the simple definition:
Business Development is the art of accessing and activating new growth market(s).
I chose to use the word ‘art’ in the definition to depict the high level of ambiguity that typically exists throughout the business development process, but also in the creativity that’s required to unlock different access points to new growth markets.
Simply, a ‘market’ can be thought of as a target audience for your product, service or experience. The market can often be in the form of a new geography, a new subset of a certain industry, as well as a new segment of potential users with a ‘problem’ that your product, service or experience solves. In a fictitious example, if I had a fitness product that measures hydration or water intake, it might also have application in certain healthcare segments such as critical care in hospitals (representing a ‘market’).
To take our fictitious example a bit further, the role of business development is to chart a path or several paths into the healthcare market to reach the critical care department within hospitals. Business Development would need understand the market enough to put definition to key capabilities required to both access and activate the new market with a value proposition that resonates. Let me unpack further:
Certain access points might arm us with the capabilities we need to strengthen our value proposition in the new market. Examples might include: a partnership with an existing organization (supplier, manufacturer) in the space that presents a mutually beneficial opportunity, a synergistic acquisition, integration into a healthcare mandated requirement, or perhaps even some novel integration into a doctor-endorsed method of care. Through this example, you can see how there might even be opportunity to access new markets via innovating the business model and experience, not just product and service innovation.
The bottom line is that when the organization sees a single-point entry door to a new market, business development not only sees side doors and back doors, they create new doors that intersect their value proposition with the audiences’ pressing needs. Better yet – when the organization thinks single-dimensionally, business development thinks multi-dimensionally, attacking a new market from multiple angles.
When business development activates a new market, they are essentially testing and pursuing several ‘go-to-market’ access points or paths simultaneously. Those paths typically are best managed on a tactical roadmap with appropriate metrics over a predetermined period of time. The objective is to narrow or prioritize the different points, based on performance, that business development determines are the most productive path(s) forward to realize the share and revenue targets in strategy.
There is no black and white instructional manual that exists for business development. However, that does not mean that you can’t apply good rigor and process around business development activity in your organization. For any market expansion initiative, business development should own the roadmap that outlines the different paths to market and all of the activity surrounding the validation of each.
Through all of the above, you’ll notice that I did not once mention the word ‘scale’. Business Development should turn over the keys to the car once the go-to-market path is established. Ideally, a cross functional relationship between sales and marketing is forged to move the new market into the operating structure and process of the existing organization. In many cases, the organization has established a new business unit or venture with a distinct capability set to carry the scale responsibilities for the new market.
So, let me ask you – is business development an integral part of your organization? If it is, are you leveraging the capability to deliver maximum value to the organization? If you’re not there yet, is it finally time to start thinking differently about business development?
If done correctly, it will finally unlock dormant potential for you in new markets.
And, that’s the kind of growth that should have a seat at your table, isn’t it?
If you found this article helpful and know colleagues who may also have interest in the topic, please don’t hesitate to share!
Perhaps most importantly, if this article hits the bulls-eye for you in any direction – whether you already have a business development-capability or not – and you’d like to dig deeper, learn more, and connect, click here.
The Strategy of Choice for 2016 is the best starting point for your growth plans this year. If you haven’t read it yet, it’s a 3-minute read at most with a self-assessment tool to get you out of the starting blocks in Q1. Check it out.