Fit or Failure in Business Development

This topic wasn’t on the list for discussion in this blog but it’s come up 3 times in the past 2 days and every time it makes me laugh.  Why do you insist of cramming a square peg into a round hole?  I’m not suggesting your hiring an engineer to do business development but I am suggesting that the person you’ve hired has a clear indication of failure and you just haven’t seen it yet.

It’s about fit.  You have a firm that in order for someone to become a client needs to develop trust, show expertise, and create a relationship before someone commits yet you hire someone in business development that has always focused on transactions.  Transactions usually equate to cold calling and cold calling is NOT how you get clients, its how you scare people away.  You are referred in, are top of mind when the need arises, hold speaking engagements to showcase knowledge and value to generate recognition and interest; people don’t come to you because you called them out of the blue and knocked their socks off in an unsolicited call.  Transaction sales people go after a quick turn around, they bring it in and leave it alone – not the right fit if you are looking to build relationships for your clientele.  This is a longer sales cycle, it’s about developing trust and an understanding of right fit, value and need.

I’ve also seen a couple hires lately of business development people who can’t seem to keep jobs or have a personality that reminds me of old carpet.  Nice people but insanely boring.  Your business development staff shouldn’t put people to sleep, they should be able to generate some excitement – you don’t necessarily want the life of the party as they tend to be more self focused but you need someone with energy.  Let’s think about the basics of business development –

  • they need to feel comfortable in a room of strangers
  • be able to communicate easily and build trust
  • they need a high enough energy level to portray interest and excitement all throughout the day
  • they need to be able to execute
  • and for a services business they need to understand and be able to manage the process of developing a relationship with someone they just met

Industry specific – your business development person needs to know enough about your industry to be dangerous, and its tough to know how much they actually know versus what they’ve read or been told.  Your interviews should be asking about how your would strategically grow my business – what areas would you take me, who should be my partners, what would you do that we aren’t already doing.  If they can’t grasp your field and what makes your business thrive they aren’t the right fit.

As we start to see hiring in business development increase make sure you are choosing the right candidates.  Just because its a fun interview doesn’t mean its going to work.  I love to see hiring in the space, it means people are pulling their head out of the sand and getting back to business but don’t waste time and money on the wrong hire.  In BD it will cost you more than lost wages.

Is Your Business Development Failing?

Some people may be upset by what they are about to see.  Keep in mind the you that I’m talking about is your business so please don’t take this personally…unless you see yourself here, if you can honestly see what’s not working you are more equipped to fix it and create a structure by which your business development soars.

Top 10 Reasons your business development is failing

  1. You hired the wrong person
  2. You didn’t train them properly
  3. You didn’t lay out expectations
  4. No one is managing them
  5. You have a Ready, Fire, Aim approach to marketing
  6. You don’t have the tools to manage business development
  7. Your marketing stinks (technical term)
  8. You don’t know why people really buy you
  9. There is no follow up
  10. It’s all about you and not the prospect – square peg round hole, anything to close the sale
  11. Bonus – your expectations are impossible to meet
  12. Bonus #2 your compensation is flawed

Chances are if your business development isn’t as successful as you’d like it’s probably because of one of these reasons but did you notice the common denominator?

A person who shouldn’t be doing business development in the first place gets put in a job with no tools, no training, no understanding of expectations has nothing else to do but fail – but you feel guilty right, because you like them and you want it to work.  Of course you do.  The people who interview for this role love to talk to people but it doesn’t mean they are good at developing business.  You had an amazing interview, the conversation just flowed and you had fun learning about them and telling them about all the amazing things you’ve done with your company – again it was just a conversation.

Good conversation doesn’t equate to a good interview – it’s important absolutely but what’s most important in business development is developing and moving a pipeline forward and results and that is tough to determine in one interview.  If over time results have not improved and you have failed to address it, there still is time.  Not all is lost, it’s possible this person could improve if given the proper motivation, direction, tools, etc. but how do you know?

This isn’t something we advertise but we can certainly help, with a short assessment and better understanding of how you handle business development we can see the gaps and can give you easy and quick solutions to addressing those gaps in most cases.  In other cases, it’s simply the wrong person and you have a decision to make.  After 20+ years of business development we’ve pretty much seen everything and here are some of my all-time favorites:

  • Firing your top salesperson because your SVP of Sales feels threatened
  • Keeping your worst sales person because he’s puckered up (you get the image, right?)
  • Expecting your business development team to be able to sell a product that can’t lawfully be sold in the state
  • Trying to force a square peg into a round hole then being upset when the client fires you a few months later
  • Your BD person selling whatever they can then leaving it up to your customer service team to figure out how to deliver the services when they don’t currently offer some of the services
  • Purchasing an extremely expensive CRM that no one uses
  • Trying to be all things to all people
  • Failing to close a slam dunk deal because you never followed up

Now I’m going to assume you don’t do these things but if you did, it would be obvious that help is needed.  What we typically see is the company saying I am struggling to get business development right but I don’t know what I’m doing wrong.  This happens in all size companies – sadly some of the situations above came from publicly traded, national companies who should know, right?  It’s just that business development is changing, it’s not about cold calling, it’s about being viewed as a resource, being the go-to for everything, creating that relationship – then you are viewed as a partner and not a vendor.

We’ve been asked to help with these types of scenarios many times and we welcome your call if you have concerns whether you have a business development team in place or looking to create one.  You don’t need to be local, as long as we can gain access to the documents, systems, people we need the analysis can be done.  For us this work is second nature so it typically isn’t too cumbersome.  Our typical fee ranges from $2000-5000 depending on the size of the business and how many BD/management staff we need to address.  Small changes can mean a drastic increase in revenue to an organization.   Email Karin at kschwartz@springboardbizdev.com if you have questions.

Is it time to ENTER the Government Market?

Commercial Firms looking to Enter the Government Market?

Are you kidding me?  Nope, surprisingly some have mentioned this as an option; even though there’s limited money, long sales cycles and a completely different process some commercially focused companies are looking to enter the government market.  After I pick myself up off the floor from laughing so hard I find that some are just chasing the idea of the big contract while others see this slowdown in spending as an opportunity to be part of the next phase or the next boom with the recognition that its years away and won’t be like the boom of the last 10 years.  If you never enter you can’t win business so at some point if there’s a desire to close government deals you need to bite the bullet regardless of the current situation.  It might be better to enter the market when you don’t expect much – any win is a huge win.  This is the company that truly understands that entering this market is an investment.  You should expect a bare minimum of 2 years activity in this market before you close a deal – for some it’s shorter and others its longer but if you think you’ll close business in 6 months you’re either smoking something or you have THE MOST amazing  widget ever.

Here’s the deal, is it a great time to enter the government market if you have no experience?  Why not, look at the environment – even long term government players are struggling to close deals.  With re-competes, less business to be had, bid protests, reduced budgets, etc those that are there now have to do more with less and if they haven’t already they will soon be forced to deal with the new reality.  That reality is a little more challenging and can be highly lucrative IF and it’s a big IF you put in the effort.  The problem is that in the past it was fairly easy to get business, just respond to a RFP and go low – you’ll get millions of dollars worth of business – not the case anymore (except the low cost – that definitely helps).  So if there’s less coming down the pike, things are taking longer to come to fruition, there’s a litigious environment why would you want to enter this market?  It’s easy, get in now, create the relationships now and prep for when the situation improves and if you get a deal it’s just icing on the cake.  It’s better to lay the groundwork now when business isn’t flying off the shelf then to feel like you’re missing out by trying to jump in when it’s going gang busters.  Again recognize that all business development is an investment.

If the government space is a desired target market you have a choice –

  • Commit to the market, do your research
  • Understand that each agency works differently and identify which is best to pursue
  • Hire those with technical knowledge and connections to bridge the gap
  • Identify where you fit and why you fit – inside each agency there are multiple silos
  • Identify contract vehicles to pursue
  • Understand your commitment – a minimum of 3 years
  • Attend industry events, join industry groups that support the mission you’ve chosen to support
  • Build a pipeline with short, mid and long term opportunities
  • Manage the pipeline consistently

Or –

  • Sit around and wait for the right time
  • Get frustrated when you have to act happy for your buddy that just closed on a big contract
  • Constantly second guess yourself
  • Prepare and identify when the right time will be and commit to action

There is no perfect time so make sure you do your homework and plan for the future.  Create a strategy to enter the market and a timetable then execute.  Most importantly create relationships and be patient.

Why Government Contractors are failing in attempts to enter the commercial market

Government Contractors pursuing the Commercial Market in a sloppy manner

Contemplating a move into the commercial market?  Make sure you do it right, learn from these mistakes.  Sadly we’re seeing them over and over with wildly successful government contractors looking to counter the inevitable drop in government projects due to sequestration by entering the commercial market targeting large financials, pharma, healthcare, etc.  The issue is they just aren’t approaching the market correctly and here’s why –

Government contractors attempting to move into the commercial market expecting to have companies drop multi-million dollar projects in their laps due to their past government performance and attempting to manage the pipeline, presentation and proposal the same as they did with agency clients.  It’s not uncommon for these contractors to expect to have a thriving commercial practice within a year to 18 months and yet they are failing and can’t understand why.  Sadly the reason is arrogance.

Attempting to put an entire industry into your way of doing business and expecting them as your prospect to allow you to run the process as you see fit versus what works best for them is arrogant.  Expecting that your past performance in an environment that functions practically polar opposite of the commercial functionality of procurement and purchasing is arrogant.  Believing that you know how they work and what works best for them without due diligence and without analysis is arrogant.  Not accepting the trial programs the commercial prospects offer you to assess your capabilities because their too small and beneath you is arrogant.

Here’s the deal – the government market and the commercial market are two very different animals and if you don’t respect the nuances of business in both markets you will fail.  For the vast majority of businesses, you aren’t anything special; I know that’s hard to hear and it’s not meant as an insult.  There are hundreds if not thousands of companies who do what you do, really well and some are already in your desired target market winning and managing successful engagements.  You are the newbie and yet you act like you know it all.  The answer is to be humble, to understand you need to build trust the same as you did in the agencies so many years ago.  Be grateful when offered a pilot or trial program regardless of how small as it’s a win with that company and a chance to build performance in the new market.  Treat the market as it needs to be treated – it’s different than agencies – understand the process, respect the process and learn what’s important to each new buyer.  It’s best to have separate teams as it’s tough to transfer from one market to the other.  Most importantly expect a minimum of 3 years to gain consistent traction.  Treat this as an investment.  This market is a far cry from the market you entered in the government space 10 years ago, it’s not a free for all and you need to show your value and your expertise.  Arrogance will kill you in this market, if you plan to enter be strategic, be willing to learn, expect to fail and understand it’s an investment in amazing future growth – bring in experts who know the industry, who can talk the language and most importantly can bridge the gap that you’ve created by ignoring this market for so long.

Entering the market unprepared is like the business developer who claims his company’s people are smarter than those employed by the competition and their service is better.  You’ve done nothing to differentiate yourself and in fact you’ve told your prospect that you really don’t respect them.  I know it wasn’t your intention in face I’m sure it’s the exact opposite of your intention.  If you’re a software developer know why your clients use you and here’s a hint, it’s not service or smart people.  There are thousands of software developers in this country so what makes you special – is it the extensive knowledge of the industry you represent and the types of challenges you’ve been asked to tackle when others failed?  Is it how you hold your people accountable so jobs are finished on time and within budget?  Is it how you collaborate with the client to ensure ultimate business efficiency, effectiveness and results – results being the key here.  Maybe it’s that your practice is to proactively keep the client up to speed on the status of the project so you can address concerns in real time so as not to create unnecessary billable hours after the fact.  Do you think a prospect might find that appealing?

The fastest way to ensure you are viewed as a commodity and get into a cheapest price wins kind of deal is to associate yourself as the same as everyone else.  If you don’t know the answer to what makes you special this is your first task and I highly suggest you ask your current clients why they love you and if their answer is your price point – you have definite problems.  Before you enter a new market you need to know what is success to my new prospect, what makes them look like a hero so you can be their hero?  This is your business development angle, not that you’ve managed large successful programs for the feds because in the commercial market things get done faster, their systems are more up to date, they don’t look for butts in seats for an unlimited amount of time – this costs them shareholder value.  A company, nonprofit, hospital, regardless of size can’t just print money – you need to know what makes them tick before you enter the market.

We’d love to hear what you’ve done to differentiate yourself in the market and how it helped you to increase market share.

Government Contractors – is NOW the time to cut Business Development?

Government Contractors – should we cut BD now?

Based in Maryland and let’s face it many of our clients either are government contractors or sell to government contractors; sequestration and budgetary concerns are real and we’ve seen a pullback in investment in business development, whether in house or outsourced.  I get it, it can be a scary time to make investments and commit to dollars you aren’t 100% sure will come back in a reasonable time but here’s why your competition is putting more money into BD right now:

  • Fiscal year end is right around the corner and if you aren’t positioning now to get money it may be too late
  • Your competitors BD staff is still meeting with decision makers and you’re not because you no longer have someone focused on BD – they know what’s coming down the pike, what most likely will be funded and what the focus for year-end money will be…do you?
  • Your competition understands BD – it’s an investment in future business and based on the market and fiscal capabilities determines when these deals close but if no one is moving those deals forward or identifying new deals they will never close and revenue is bound to drop.  We’ve seen $30 M contractors who haven’t closed a deal in years because they simply respond to RFP’s once they hit the street, this used to be an effective strategy but it’s no longer viable if you want to grow or even maintain as re-competes and protests are shrinking your existing business.
  • Small business right now in the government market should be thriving.  I’ve seen a number of small businesses winning large new projects, adding people to existing contracts and growing at a time when the big boys are tightening their belts.  What differentiates these companies – a massive focus on business development.  They’ve made the investment in one of two ways:
    • Infrastructure – CFO/COO so the CEO can focus on BD
    • Hiring full time business development at a high level
    • Engaging BD on an outsourced basis which we highly recommend by the way
    • Those that are winning aren’t just collecting contract vehicles, they are diving deep.  Having a contract vehicle is simply a hunting license, there is no guarantee one penny will come your way.  Your BD efforts need to be focused on winning task orders in those customers who’ve recognized you as a winner already.  Dive deep and stop the surface wins.  If you have a laundry list of contract vehicles but only $10M in revenue you are not taking advantage of the amazing opportunities you have.
    • Finally just because you fulfill a set aside doesn’t mean you’ll get business.  I get it, you spent a lot of time and effort to get those set asides lined up but again you’re still a dime a dozen.  That doesn’t always sit well with some people but you have to understand there are thousands of companies that fill set asides – if you can’t differentiate yourself it all was a waste of time.  You still have a job to do – reply to sources sought, market yourself as an excellent provider with a set aside being a bonus, meeting with decision makers, meeting with teaming partners.  Again these set asides are simply hunting licenses, you still need a focus on business development to see the benefits of the effort.  The 8A’s, woman owned, HUBZone, veteran owned firms who have invested in business development and infrastructure are thriving, they are go-to partners for teaming and are winning full and open (before they graduate from the 8A program).  They understand that from the day they earn that certification they need to plan for the day they don’t need to use it.  If you’re solely gaining business because of you fill a set aside and no other reason you are set up to fail in the long run.

Sequestration will cause a shake-up in the contractor marketplace, you’ll see some fail and you’ll see others grow.  You have a choice – to believe in the inevitable doom of the marketplace, withdraw and ultimately shrink slowly and painfully or seize the opportunity.  Those that grow see sequestration as a huge opportunity and invest to ensure that opportunity isn’t lost.  It’s your choice.

 

If you think outsourcing BD efforts might be an option let us know.  Our consultants have a minimum of 20 years experience in the agencies in which they work, they are well respected, consistently close business and we’re roughly 30-60% of the cost of hiring full time.  Email Karin if you’d like more information at kschwartz@springboardbizdev.com