I have often heard many things referred to as the “lifeblood” of a company, items such as cash, customer service, operations, among others. Every essential element of business are vital to the long term growth and prosperity of any company but the truth be known, new business development (BD) is in fact the true lifeblood of any business!!!
All companies have a need for new business, not merely for profit but to simply survive! No matter what the product or service, the cost of doing business increases almost every year……employees expect pay raises, parts and materials cost continue to escalate, and we need newer and better equipment, etc.
As a result the cost of doing business is constantly increasing and we must be able to cover those cost just to remain in business, regardless of the need for profit! In reality, a firm does not need any operations, accounting, admin, or other personnel and services if they don’t have adequate new business opportunities. Yet despite this fact, business development continues to be the single most misunderstood and neglected area in all of business. Why? Because most people do not really know what constitutes business development. While there are many definitions, simply put BD is any action/activity associated with the identification, development, quantification, pursuit, bid, and capture of new opportunities that can be profitably executed.
Many people enter business because they have what they consider to be a product or service to be of interest or value to the marketplace. Many fail to get their product or service to market or never realize measurable success, which I define as an adequate Return on Investment (ROI). The primary reason is they mistakenly assume that in depth subject matter knowledge or a passion for what they do is all that’s needed to succeed. Even those companies that do succeed to some degree oftentimes fail to understand and appreciate the value of the business development function and team. More times than not great emphasis is placed on other functions and activities and sometimes rightfully so. However, the benefit of these other functions and activities become significantly diminished and in some instances meaningless without consistent new business.
Businesses are constantly “going out of business”! New business development, therefore, is the true life blood of any company! A constant demand for higher quality products and services at lower prices are but a few of the consistent demands on the marketplace that influence the need for more business. Employees desire and deserve pay raises, new and additional resources are needed, etc.None of this is possible without new business and the monies that are generated.
Notice in this article, I use the term new business development not sales, or sales and marketing, etc. Most companies, however, think it is the sales department’s responsibility to keep everyone in work…..this unhealthy ATTITUDE eventually leads to reduced revenue if not outright failure.Business development refers to a function versus a department……….my personal philosophy is that everyone employed by a company has a vested interest in the success of that company.Therefore, anyone in my employ is involved in BD to some extent or another……… The bottom line is that business development must, of absolute necessity, be a top priority………. for everyone within a company!
Stan Miller – Front Range Support Services – Business Development Consultants