Business Development and the “New Normal”

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Reduction of Full Time Business Development Staff (Government Contractors)

So many highly experienced and successful business developers have hit the street this past year – cut from long time employers over money, a perception that Business Development is overhead.  Yes Business Development can become overhead if not managed correctly.  Ultimately BD even in a tough market should be about lead generation, target research, needs analysis, moving the prospect through the pipeline to pre-close and ultimately proposal and closing.  Yes things are taking longer and yes, some government agencies have no money to spend right now but is cutting BD an effective tool right now?  The answer is…it depends.

Do you have a unique solution or a solution that we know is needed right now and can we go after year end money or upcoming projects?  Do you solve a pressing issue; do you eliminate butts in seats?  Are you a sub or a prime?  A number of questions need to be answered to know for sure what the correct answer is but in the end there’s really only one question to answer and for that you’ll need to read the entire blog!

Each agency is different as you well know; they have different budgets and different needs.  Efficiency is king right now so if you’re selling bodies business development can definitely be tough however it’s not impossible.  Being a sub is a challenge right now as large primes are removing subs from contracts to keep the seats for their own people.  Here’s what we know right now – the cuts are real, we have no agreed upon budget and haven’t for years and quite frankly no one really knows what’s going to happen.  Budget constraints are here to stay so I hate to put it like this but you simply need to get over it.  We’ve seen some amazing talent let go this past year and eventually, typically after 6 months of searching they find a new position at a lower salary, one that more accurately reflects today’s environment of lowest cost technically acceptable.  Be proactive – talk with your employees about the situation at hand – it’s not a surprise to anyone.  There is a choice – allow top talent to leave or work to restructure compensation so it fits the new normal.

Full time business development leaving companies is definitely an opportunity for us at Springboard however we feel that if business development isn’t taken seriously it’s not really an opportunity for anyone.  Some companies need full time BD at a high level while others can grow dramatically with outsourced support – it just depends on what fits.  While we tend to be 1/3-1/2 the cost of full time BD help we aren’t always the right fit, sometimes full time is needed – especially with very large firms.

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

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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