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Best Practices in 
Business Development 
prepared by 
David Fatlowitz 
July 2010
2 
Topics 
• Today’s typical corporate structure 
• Forecast vs stretch goal (gap analysis) 
• 2009 to 2011 forecasts & plan for reaching goals 
• Innovation plan for entering new markets 
• Some worthwhile targets 
• BDG concept 
• Recommendations & best practices
3 
Preface 
• Today’s globalized business environment moves with 
ever increasing speed, and entails many new risks. To 
succeed at growing into new markets requires strong 
co-ordination, tireless communications and 
exceptional risk management… 
• The following slides integrate commentary from 
numerous business executives and academic thought 
leaders and represents a working guideline for best 
practices in developing new business…
4 
Today’s Typical Sales Dept Structure 
(Company X) 
VP 
TYPICAL METHOD: 
‘Military Style’ Top 
Down Command & 
Control structure 
“By decree you will…” 
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 
Add’l mngmt layers 
RESULT: Little co-ordination 
with 
other depts, focus 
mainly on closing 
deals …
VP Marketing 
5 
Today’s Typical Organizational Structure 
(Company X) 
President 
VP Finance 
(F) 
VP IT 
(I) 
VP Technology 
(T) 
VP Sales 
(S) 
Regional 
Sales Mngr 
Finance Dept IT Dept Technology Dept Sales Dept 
Regional 
Sales Mngr 
(M) 
Marketing Dept 
INFORMATION 
SILOS 
Issues: 
• conflicting priorities 
• misaligned compensation 
• politics & turf wars 
• poor comm across depts 
Takeaway: 
Interests often Departmental” 
not “Customer Centric” or 
aligned to growth targets…
VP Marketing 
6 
Today’s Typical Organizational Structure 
(Company X) 
President 
VP Finance 
(F) 
VP IT 
(I) 
VP Technology 
(T) 
VP Sales 
(S) 
Regional 
Sales Mngr 
Finance Dept IT Dept Technology Dept Sales Dept 
Regional 
Sales Mngr 
(M) 
Marketing Dept 
INFORMATION 
SILOS 
Impact: 
Organization lacks flexibility 
& essential knowledge to 
make good decisions at 
critical times… 
Results: 
• low morale 
• poor customer satisfaction 
• missed opportunities
7 
Typical Result: Projected Sales 
(Company X) 
Rev-A Existing Accounts (7% Annual Growth) 
$239M 
Stretch Goal = $280M 
$223M 
Opportunity Cost = $ 57M Gap 
! 
$208M 
$195M 
$182M 
300 
250 
200 
150 
100 
50 
0 
Based on current market opportunities alone 
Company X falls short of their target… 
2006 2007 2008 2009 2010
8 
Business Development Motivation 
(Company X) 
Example: Projected 3 Year Sales Trend 
Market Segments % Fiscal Year '08 % of Next 3 Years 
Market A 26% 37% 
Market B 16% 14% 
Market C 15% 14% 
Market D 14% 14% 
Market E 13% 7% 
Market F 8% 5% 
Market G 3% 4% 
Market H 2% 3% 
Market I 2% 2% 
Market J 0% 0% 
Market K 0% 0% 
Totals 100% 100% 
Growth expected only in top market, otherwise little revenue growth or 
diversification expected over next 3 years …
9 
Core Business Issues & Results Scorecard 
#1 – maintain cash flow to finance ongoing operations 
Business Horizon: close sales within 1 year or less 
Current Grade: ~ B 
#2 – growth, diversification & flexibility 
Business Horizon: close sales within 2-3 years 
Current Grade: ~ C or D 
Why? 
Lack of co-ordination across departments limits information flow & adaptability 
Wrong people trying to execute bus dev process 
Result: information & decision making “firewalls” are created within the 
company limiting their ability to penetrate new markets…
10 
Some Growth Possibilities 
• New market 1 
• New market 2 
• New market 3 
• New market 4 
• New market 5
11 
How to break into new markets 
?
12 
How to break into new markets 
Create a Business Development Group…
13 
Business Development Group 
Guiding Mantra: 
“Everyone works in Business Development” 
Key Lever: Virtual Teaming 
Focus: Opportunities with 2-3 year horizon
14 
Business Development Group 
Definition: 
• Purpose - to develop and align growth strategies 
• Focus – turn long term horizon (2-3 years) into real sales 
• Structure - composed of real & virtual HR assets 
• Range - global network of subsidiaries, alliance partners, etc 
• Goals - drive communication, knowledge & sales 
• Benefits - to enhance value & profits and enter new markets 
Structure: 
• Director - Broad powers to set vision & goals for BDG 
• Exec VP – executive decision making rights over Dept VP’s 
• BDM’s – business development management responsibilities
15 
BDG – Features & Benefits 
• Adds focus to activities: 
- Separates short term cash flow creation (sales) from long term 
strategic opportunity engagement (business devel) 
- Clarify priorities i.e. “beneficial” (profitable) opportunities 
• Leverages cross functional teams: 
- improves networking within  without the organization 
- assists information flow up  down org hierarchy 
Puts market opportunities in the hands of experienced decision 
makers (BDM’s) and reduces overall risk 
Net Result: better morale, improved decision making, 
increased competitive advantage and higher profits…
16 
Creating Value in New Markets 
combining resources and capabilities creates new 
competencies and beneficial outcomes… 
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 
Takeaway: 
Need to 
spend 
sufficient 
time on this ! 
A clear plan 
demonstrates 
strong 
commitment 
to customers 
in new 
markets 
not presently 
served…
Some Basics of Good Strategy… 
Start of Industry Shake Out 
High Margin  Profits 
•Invest to grow market share 
•Exploit economies of scale 
•Cut costs and prices to drive volume 
•Develop strong brands 
•Control channels of distribution 
Reference: London School of Business 
Key Take Away: 
these are all important 
elements of strategy but 
requires good co-ordination… 
17
LOW LOW 
18 
To Develop Winning Strategy 
Apply Porter’s Five Force Analysis 
(Example for POF use in fiber telcom market) 
HIGH 
•Small number of suppliers 
(POF, connecters, etc.) 
•Low product differentiation 
•Inevitable components 
(LEDs, connecters, etc) 
Barriers to entry Threat of substitutes 
•Few competitors 
•Low brand equity 
•Low exit barrier 
•Low product differentiation 
•Small number of buyers now 
•Low competition among buyers 
•Low purchased item differentiation 
•Low brand equity 
•Low economies of scale 
•Low capital requirement 
•No patent 
•Low product differentiation 
(3 standard) 
•Know-how 
•Many substitutes available 
(e.g. copper, coax, wireless, etc) 
•However high switching costs 
(POF is cheaper than others) 
•POF has strong product differentiation: 
- good for short distances 
-light weight (good for aircraft use) 
- high reliability/long service life 
- high popularity/readily available 
Supplier power 
Rivalry 
LOW 
LOW 
Buyer power 
Ref: Prof. Michael Porter, 
Harvard University
1: ? 
What are the five key elements for 
successful organizational change ? 
2: ? 
3: ? 
5: ? 
4: ? 
BDG 
2 
4 3 
5 
1 
19
20 
1: STRATEGY 
The five key elements for successful 
organizational change… 
2: ORG STRUCTURE 
4: REWARDS 
3: INFO  DECISION MAKING (PROCESS) 
5: PEOPLE 
BDG 
2 
4 3 
5 
1 
Source: Dr. Don Hambrick, Professor of Organizational Change, 
Penn State Smeal College of Business
1: STRATEGY: 
• pick strategically important markets 
• set guiding principals* Example: 
- product “quality” leader 
- premium service capability 
- premium pricing 
Recommendations 
• maintain high touch and communication 
with customers 
• penetrate new market segments using 
market experts  integrated marketing 
campaigns 
• continue efforts to enhance brand 
21 
2: STRUCTURE: 
• add BD Director  BD Project Managers 
• SMTFI team members with defined roles: 
- new opportunity analysis (ROI estimates) 
- assign sales  marketing by projects 
- develop mentorship program 
Some Key 
1 
BDG 
2 
4 3 
• create  apply new 3: metrics and scorecards 
5: PEOPLE: 
• hire add’l S-M-T-F-I star players from industry 
• leverage virtual teaming @ global level 
• maintain individual accountability 
• maintain family culture 
• create career development paths (ex) 
-Exec Sales  Marketing BDM project leads 
-create dedicated IT solutions team focused on BD issues 
-establish technology team for BDG projects 
-hire entrepreneurial business financial experts 
5 
4: REWARDS: 
• compensation: team based metrics and milestone bonuses 
• add’l project management opportunities 
• incremental (tiered) development opportunities 
•career advancement opportunities 
• career fulfillment  morale boost 
• other ? 
KEY INFO  DECISION MAKING PROCESS: 
• leverage knowledge databases (formal  informal) 
• planning and goal setting based on opportunity analysis (SWOT  ROI) 
• frequent meetings (S-M-T-F-I) 
• decision making: strategic- centralized, tactical - local
22 
New Organizational Structure with BDG 
President 
VP Finance VP IT VP Technology VP Sales 
Regional 
Sales Mngr 
Finance Dept IT Dept Technology Dept Sales Dept 
(Acct Execs) 
Regional 
Sales Mngr 
BDG 
Director 
BDG 
Exec VP 
BDM’s 
VP Marketing 
Marketing Dept
23 
New Organizational Structure with BDG 
President 
VP Finance VP IT VP Technology VP Sales 
Regional 
Sales Mngr 
Finance Dept IT Dept Technology Dept Sales Dept 
(Acct Execs) 
Regional 
Sales Mngr 
BDG 
Director 
BDG 
Exec VP 
BDM’s 
VP Marketing 
Marketing Dept 
entrepreneurs with 
alliance and deal 
building skills…
24 
New Organizational Structure with BDG 
President 
VP Finance VP IT VP Technology VP Sales 
Regional 
Sales Mngr 
Finance Dept IT Dept Technology Dept Sales Dept 
(Acct Execs) 
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
extensive market 
knowledge  BD 
25 
New Organizational Structure with BDG 
President 
VP Finance VP IT VP Technology VP Sales 
Regional 
Sales Mngr 
Finance Dept IT Dept Technology Dept Sales Dept 
(Acct Execs) 
experience 
Regional 
Sales Mngr 
BDG 
Director 
BDG 
Exec VP 
BDM’s 
VP Marketing 
Marketing Dept 
well connected at 
CXO level with 
thought leaders  
major industry 
players 
entrepreneurs with 
alliance and deal 
building skills…
26 
BDG: Segments Sales Activity… 
President 
Sales  Marketing 
focus on “mature”  
tactical opportunities 
ready to bear fruit 
VP Finance VP IT VP Technology VP Sales 
Regional 
Sales Mngr 
Finance Dept IT Dept Technology Dept Sales Dept 
Regional 
Sales Mngr 
ISE’s, SE’s, ESE’s 
BDG 
Director 
BDG 
Exec VP 
BDM’s 
VP Marketing 
Marketing Dept 
PM’s, MarCom, Other 
BDG concentrates on 
strategic “horizon” 
opportunities that need 
focus  nurturing… 
Key Message to employees: EVERYONE works in business 
development, participation is thru BDG projects…
27 
PM, RM, BDM Roles 
• Product Manager (PM) Responsibilities: 
– Manage technical  marketing information for all products 
within product line 
– Set pricing guidelines on products 
– Support key opportunities with all necessary technical and 
product related needs, demo’s, troubleshooting, 
– Provide guidance to engineering on new product needs 
– Guide market research on target segments  appls 
– Manage PL for specific product lines
28 
PM, RM, BDM Roles 
Products Sales 
PM 
POR 
R1 R3 
Marketing Finance 
M1 
M2 
M3 
M5 
M4 
R2 
R4 
R5 
PM’s WIG: Sell Products 
into as many markets  
regions as possible…
29 
PM, RM, BDM Roles 
• Regional Manager (RM) Responsibilities: 
– Manage sales activity within Territory 
– Mentor ISE’s, SE’s and ESE’s on sales techniques 
– Assign SE’s to new accounts 
– Set strategy  assist negotiations on key accounts 
– Co-ordinate customer service support 
– Assist VP Sales in new policy rollouts 
– Manage PL for Specific Regions
30 
PM, RM, BDM Roles 
Products Sales 
PL1 PL4 RM 
PL3 
Marketing Finance 
M1 
M2 
M3 
M5 
M4 
ROR 
PL2 PL5 
RM’s WIG: Grow sales in 
Region by selling all 
products into as many 
markets as possible…
31 
PM, RM, BDM Roles 
• Bus Dev Manager (BDM) Responsibilities: 
– Identifies  communicates new opportunities to mngmt 
– Do analysis on risk/reward in key market 
– Develop joint strategy with PMs  RMs 
– Manage relationships with key opportunities 
– Co-ordinate SMFIT activity related to market segment 
– Manage PL for specific markets
32 
PM, RM, BDM Roles 
Products Sales 
PL1 PL4 
PL3 
PL2 PL5 
R1 R3 
Marketing Finance 
MOR 
R2 
R4 
R5 
BDM 
BDM’s WIG: Grow sales in 
Market by selling all 
products into all regions…
Reaching the Pot of Gold… 
Products Sales 
PM RM 
Opportunity 
Marketing Finance 
BDM 
requires embracing teamwork, sharing decision making 
33 
 overlapping responsibilities…
34 
Business Development Group 
New Market Projects (near term targets) 
NM 5 
NM 4 NM 3 
NM 2 
NM 1 
BDG
35 
Business Development Group 
New Market Projects (near  long term targets) 
NM 9 
NM 8 
NM 7 
NM 2 
NM 6 NM 5 
NM 3 
NM 4 
NM 1 
BDG
36 
BDG Project Scoring… 
• Purpose –set priorities for BDG activity  resources 
• Methodology – establish numerical scoring system 
based on key attributes: 
- strategic value 
- financial return (IRR, ROI, etc) 
- technical requirements 
- implementation feasibility (degree of difficulty) 
- risk assessment
37 
Company X: BDG Benefit Example 
(Projected Revenues) 
Rev-A (7%) Rev-B (10%) Rev-C (15%) 
$ 318M 
$277M 
~ On target 
$ 241M 
$209M 
$182M 
350 
300 
250 
200 
150 
100 
50 
0 
2006 2007 2008 2009 2010 
Rev A = Today’s 
Customers Only 
Rev B = Today + 
Tomorrow’s 
Pipeline 
Rev C = Today + 
Tomorrow + BDG 
Stretch Goal = $280M
38 
STRATEGY: ? 
Future: Global BDG 
(networking with subsidiaries) 
STRUCTURE: ? 
Collaboration and share 
responsibilities among 
subsidiaries on global 
accounts  opportunities 
REWARDS: ? 
Outsourced Sales: revenue 
recognition for subsidiaries that 
initiate new business 
INFO  DECISION MAKING PROCESSES: ? 
PEOPLE: ? 
BDG
39 
Some Key Challenges 
– defining benefits of adding BDG in terms of opportunity costs 
vs present approach 
– gaining top mngmt support (Board, CEO, VPs) 
– defining 5 key elements: strategy, structure, rewards, etc 
– leadership needs (identifying key characteristics) 
– defining new roles for S-M-F-T-I personnel 
– gaining adoption of BDG goals across all departments 
– becoming a truly global company 
(e.g. gaining subsidiary  alliance participation)
3 – Reinforce new 
culture thru symbolic 
actions 
40 
BDG Implementation: 
Best practices in 
driving culture change… 
1 - Communicate 
need for change 
Redefine top 
metrics  
rewards to 
establish 
credibility 
Monitor 
acceptance 
 make 
adjustments 
2 – Implement 
change initiative 
To UN-FREEZE… To EXECUTE CHANGE… To RE-FREEZE… 
Source: Dr. Dennis Gioia, Professor of Leadership Excellence, 
Penn State Smeal College of Business
41 
Tomorrow’s Shining Star 
(Company X with new Organizational Structure) 
Bi-directional 
information flow
42 
End

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Best practices in business development

  • 1. Best Practices in Business Development prepared by David Fatlowitz July 2010
  • 2. 2 Topics • Today’s typical corporate structure • Forecast vs stretch goal (gap analysis) • 2009 to 2011 forecasts & plan for reaching goals • Innovation plan for entering new markets • Some worthwhile targets • BDG concept • Recommendations & best practices
  • 3. 3 Preface • Today’s globalized business environment moves with ever increasing speed, and entails many new risks. To succeed at growing into new markets requires strong co-ordination, tireless communications and exceptional risk management… • The following slides integrate commentary from numerous business executives and academic thought leaders and represents a working guideline for best practices in developing new business…
  • 4. 4 Today’s Typical Sales Dept Structure (Company X) VP TYPICAL METHOD: ‘Military Style’ Top Down Command & Control structure “By decree you will…” 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 Add’l mngmt layers RESULT: Little co-ordination with other depts, focus mainly on closing deals …
  • 5. VP Marketing 5 Today’s Typical Organizational Structure (Company X) President VP Finance (F) VP IT (I) VP Technology (T) VP Sales (S) Regional Sales Mngr Finance Dept IT Dept Technology Dept Sales Dept Regional Sales Mngr (M) Marketing Dept INFORMATION SILOS Issues: • conflicting priorities • misaligned compensation • politics & turf wars • poor comm across depts Takeaway: Interests often Departmental” not “Customer Centric” or aligned to growth targets…
  • 6. VP Marketing 6 Today’s Typical Organizational Structure (Company X) President VP Finance (F) VP IT (I) VP Technology (T) VP Sales (S) Regional Sales Mngr Finance Dept IT Dept Technology Dept Sales Dept Regional Sales Mngr (M) Marketing Dept INFORMATION SILOS Impact: Organization lacks flexibility & essential knowledge to make good decisions at critical times… Results: • low morale • poor customer satisfaction • missed opportunities
  • 7. 7 Typical Result: Projected Sales (Company X) Rev-A Existing Accounts (7% Annual Growth) $239M Stretch Goal = $280M $223M Opportunity Cost = $ 57M Gap ! $208M $195M $182M 300 250 200 150 100 50 0 Based on current market opportunities alone Company X falls short of their target… 2006 2007 2008 2009 2010
  • 8. 8 Business Development Motivation (Company X) Example: Projected 3 Year Sales Trend Market Segments % Fiscal Year '08 % of Next 3 Years Market A 26% 37% Market B 16% 14% Market C 15% 14% Market D 14% 14% Market E 13% 7% Market F 8% 5% Market G 3% 4% Market H 2% 3% Market I 2% 2% Market J 0% 0% Market K 0% 0% Totals 100% 100% Growth expected only in top market, otherwise little revenue growth or diversification expected over next 3 years …
  • 9. 9 Core Business Issues & Results Scorecard #1 – maintain cash flow to finance ongoing operations Business Horizon: close sales within 1 year or less Current Grade: ~ B #2 – growth, diversification & flexibility Business Horizon: close sales within 2-3 years Current Grade: ~ C or D Why? Lack of co-ordination across departments limits information flow & adaptability Wrong people trying to execute bus dev process Result: information & decision making “firewalls” are created within the company limiting their ability to penetrate new markets…
  • 10. 10 Some Growth Possibilities • New market 1 • New market 2 • New market 3 • New market 4 • New market 5
  • 11. 11 How to break into new markets ?
  • 12. 12 How to break into new markets Create a Business Development Group…
  • 13. 13 Business Development Group Guiding Mantra: “Everyone works in Business Development” Key Lever: Virtual Teaming Focus: Opportunities with 2-3 year horizon
  • 14. 14 Business Development Group Definition: • Purpose - to develop and align growth strategies • Focus – turn long term horizon (2-3 years) into real sales • Structure - composed of real & virtual HR assets • Range - global network of subsidiaries, alliance partners, etc • Goals - drive communication, knowledge & sales • Benefits - to enhance value & profits and enter new markets Structure: • Director - Broad powers to set vision & goals for BDG • Exec VP – executive decision making rights over Dept VP’s • BDM’s – business development management responsibilities
  • 15. 15 BDG – Features & Benefits • Adds focus to activities: - Separates short term cash flow creation (sales) from long term strategic opportunity engagement (business devel) - Clarify priorities i.e. “beneficial” (profitable) opportunities • Leverages cross functional teams: - improves networking within without the organization - assists information flow up down org hierarchy Puts market opportunities in the hands of experienced decision makers (BDM’s) and reduces overall risk Net Result: better morale, improved decision making, increased competitive advantage and higher profits…
  • 16. 16 Creating Value in New Markets combining resources and capabilities creates new competencies and beneficial outcomes… 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 Takeaway: Need to spend sufficient time on this ! A clear plan demonstrates strong commitment to customers in new markets not presently served…
  • 17. Some Basics of Good Strategy… Start of Industry Shake Out High Margin Profits •Invest to grow market share •Exploit economies of scale •Cut costs and prices to drive volume •Develop strong brands •Control channels of distribution Reference: London School of Business Key Take Away: these are all important elements of strategy but requires good co-ordination… 17
  • 18. LOW LOW 18 To Develop Winning Strategy Apply Porter’s Five Force Analysis (Example for POF use in fiber telcom market) HIGH •Small number of suppliers (POF, connecters, etc.) •Low product differentiation •Inevitable components (LEDs, connecters, etc) Barriers to entry Threat of substitutes •Few competitors •Low brand equity •Low exit barrier •Low product differentiation •Small number of buyers now •Low competition among buyers •Low purchased item differentiation •Low brand equity •Low economies of scale •Low capital requirement •No patent •Low product differentiation (3 standard) •Know-how •Many substitutes available (e.g. copper, coax, wireless, etc) •However high switching costs (POF is cheaper than others) •POF has strong product differentiation: - good for short distances -light weight (good for aircraft use) - high reliability/long service life - high popularity/readily available Supplier power Rivalry LOW LOW Buyer power Ref: Prof. Michael Porter, Harvard University
  • 19. 1: ? What are the five key elements for successful organizational change ? 2: ? 3: ? 5: ? 4: ? BDG 2 4 3 5 1 19
  • 20. 20 1: STRATEGY The five key elements for successful organizational change… 2: ORG STRUCTURE 4: REWARDS 3: INFO DECISION MAKING (PROCESS) 5: PEOPLE BDG 2 4 3 5 1 Source: Dr. Don Hambrick, Professor of Organizational Change, Penn State Smeal College of Business
  • 21. 1: STRATEGY: • pick strategically important markets • set guiding principals* Example: - product “quality” leader - premium service capability - premium pricing Recommendations • maintain high touch and communication with customers • penetrate new market segments using market experts integrated marketing campaigns • continue efforts to enhance brand 21 2: STRUCTURE: • add BD Director BD Project Managers • SMTFI team members with defined roles: - new opportunity analysis (ROI estimates) - assign sales marketing by projects - develop mentorship program Some Key 1 BDG 2 4 3 • create apply new 3: metrics and scorecards 5: PEOPLE: • hire add’l S-M-T-F-I star players from industry • leverage virtual teaming @ global level • maintain individual accountability • maintain family culture • create career development paths (ex) -Exec Sales Marketing BDM project leads -create dedicated IT solutions team focused on BD issues -establish technology team for BDG projects -hire entrepreneurial business financial experts 5 4: REWARDS: • compensation: team based metrics and milestone bonuses • add’l project management opportunities • incremental (tiered) development opportunities •career advancement opportunities • career fulfillment morale boost • other ? KEY INFO DECISION MAKING PROCESS: • leverage knowledge databases (formal informal) • planning and goal setting based on opportunity analysis (SWOT ROI) • frequent meetings (S-M-T-F-I) • decision making: strategic- centralized, tactical - local
  • 22. 22 New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Regional Sales Mngr Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept
  • 23. 23 New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Regional Sales Mngr Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept entrepreneurs with alliance and deal building skills…
  • 24. 24 New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Regional Sales Mngr Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) 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
  • 25. extensive market knowledge BD 25 New Organizational Structure with BDG President VP Finance VP IT VP Technology VP Sales Regional Sales Mngr Finance Dept IT Dept Technology Dept Sales Dept (Acct Execs) experience Regional Sales Mngr BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept well connected at CXO level with thought leaders major industry players entrepreneurs with alliance and deal building skills…
  • 26. 26 BDG: Segments Sales Activity… President Sales Marketing focus on “mature” tactical opportunities ready to bear fruit VP Finance VP IT VP Technology VP Sales Regional Sales Mngr Finance Dept IT Dept Technology Dept Sales Dept Regional Sales Mngr ISE’s, SE’s, ESE’s BDG Director BDG Exec VP BDM’s VP Marketing Marketing Dept PM’s, MarCom, Other BDG concentrates on strategic “horizon” opportunities that need focus nurturing… Key Message to employees: EVERYONE works in business development, participation is thru BDG projects…
  • 27. 27 PM, RM, BDM Roles • Product Manager (PM) Responsibilities: – Manage technical marketing information for all products within product line – Set pricing guidelines on products – Support key opportunities with all necessary technical and product related needs, demo’s, troubleshooting, – Provide guidance to engineering on new product needs – Guide market research on target segments appls – Manage PL for specific product lines
  • 28. 28 PM, RM, BDM Roles Products Sales PM POR R1 R3 Marketing Finance M1 M2 M3 M5 M4 R2 R4 R5 PM’s WIG: Sell Products into as many markets regions as possible…
  • 29. 29 PM, RM, BDM Roles • Regional Manager (RM) Responsibilities: – Manage sales activity within Territory – Mentor ISE’s, SE’s and ESE’s on sales techniques – Assign SE’s to new accounts – Set strategy assist negotiations on key accounts – Co-ordinate customer service support – Assist VP Sales in new policy rollouts – Manage PL for Specific Regions
  • 30. 30 PM, RM, BDM Roles Products Sales PL1 PL4 RM PL3 Marketing Finance M1 M2 M3 M5 M4 ROR PL2 PL5 RM’s WIG: Grow sales in Region by selling all products into as many markets as possible…
  • 31. 31 PM, RM, BDM Roles • Bus Dev Manager (BDM) Responsibilities: – Identifies communicates new opportunities to mngmt – Do analysis on risk/reward in key market – Develop joint strategy with PMs RMs – Manage relationships with key opportunities – Co-ordinate SMFIT activity related to market segment – Manage PL for specific markets
  • 32. 32 PM, RM, BDM Roles Products Sales PL1 PL4 PL3 PL2 PL5 R1 R3 Marketing Finance MOR R2 R4 R5 BDM BDM’s WIG: Grow sales in Market by selling all products into all regions…
  • 33. Reaching the Pot of Gold… Products Sales PM RM Opportunity Marketing Finance BDM requires embracing teamwork, sharing decision making 33 overlapping responsibilities…
  • 34. 34 Business Development Group New Market Projects (near term targets) NM 5 NM 4 NM 3 NM 2 NM 1 BDG
  • 35. 35 Business Development Group New Market Projects (near long term targets) NM 9 NM 8 NM 7 NM 2 NM 6 NM 5 NM 3 NM 4 NM 1 BDG
  • 36. 36 BDG Project Scoring… • Purpose –set priorities for BDG activity resources • Methodology – establish numerical scoring system based on key attributes: - strategic value - financial return (IRR, ROI, etc) - technical requirements - implementation feasibility (degree of difficulty) - risk assessment
  • 37. 37 Company X: BDG Benefit Example (Projected Revenues) Rev-A (7%) Rev-B (10%) Rev-C (15%) $ 318M $277M ~ On target $ 241M $209M $182M 350 300 250 200 150 100 50 0 2006 2007 2008 2009 2010 Rev A = Today’s Customers Only Rev B = Today + Tomorrow’s Pipeline Rev C = Today + Tomorrow + BDG Stretch Goal = $280M
  • 38. 38 STRATEGY: ? Future: Global BDG (networking with subsidiaries) STRUCTURE: ? Collaboration and share responsibilities among subsidiaries on global accounts opportunities REWARDS: ? Outsourced Sales: revenue recognition for subsidiaries that initiate new business INFO DECISION MAKING PROCESSES: ? PEOPLE: ? BDG
  • 39. 39 Some Key Challenges – defining benefits of adding BDG in terms of opportunity costs vs present approach – gaining top mngmt support (Board, CEO, VPs) – defining 5 key elements: strategy, structure, rewards, etc – leadership needs (identifying key characteristics) – defining new roles for S-M-F-T-I personnel – gaining adoption of BDG goals across all departments – becoming a truly global company (e.g. gaining subsidiary alliance participation)
  • 40. 3 – Reinforce new culture thru symbolic actions 40 BDG Implementation: Best practices in driving culture change… 1 - Communicate need for change Redefine top metrics rewards to establish credibility Monitor acceptance make adjustments 2 – Implement change initiative To UN-FREEZE… To EXECUTE CHANGE… To RE-FREEZE… Source: Dr. Dennis Gioia, Professor of Leadership Excellence, Penn State Smeal College of Business
  • 41. 41 Tomorrow’s Shining Star (Company X with new Organizational Structure) Bi-directional information flow