Selling IT: Business Development

In our newsletters, we talk a lot about the importance of advanced knowledge -- knowing about an agency, its people, its nuances and, most importantly, its program goals. You have to understand the needs of your potential customer before you can begin to sell effectively to that customer.

You identify your target agencies by studying such information as budgets, procurement forecasts and acquisition plans. Once identified, you get to know the decision-makers within those agencies. By following these steps effectively, you begin to "fuel" your sales.

In this third installment of our IT series, we're going to talk in some depth about a position that has come to be known as "Business Development," one that is responsible for fueling sales.

What is Business Development?

A business development position is essentially a sales position. The important distinction is that the business developer is involved in long term activity, while the salesperson is involved in short term activity.

Business development folks shape potential requirements into "actionable" or "ripe" sales opportunities. Their horizon is half a year to two years down the road. Their focus is on building knowledge and relationships within agencies to shape programs, budgets and requirements in the company's favor.

A salesperson's horizon shouldn't go out beyond one year. A salesperson must focus on what can be closed THIS quarter, while setting up deals for the next one or two quarters.

"Inside" vs. "Outside" Business Development

Our friends at the immixGroup like to make the distinction between inside and outside business development. A business development person on the inside is doing research and feeding information to an outside business development person who is doing the relationship-building. In smaller organizations, a business developer generally will perform both of these functions.

Let's take a closer look:

Inside

The inside business development person (BD) conducts research to find target agencies, official buyers, and end-users who are interested in buying the company's products or services.

One simple example of this: an inside BD will find a target agency and provide the sales staff with a list of people who have bought the company's products or services in the past, or are intending to buy them in the future.

In organizations that sell complex products or services, where the sales cycle is long, the inside BD is probably feeding this information to the outside BD, who grabs the baton, if you will, and begins the relationship-building.

Outside

While the inside BD is identifying and tracking opportunities well in advance of an RFP, the outside BD is taking an active role in the communication necessary to respond to such things as requests for information and market surveys. The outside BD is working to shape acquisition plans, define future requirements and influence evaluation criteria.

More broadly stated, the outside BD is working toward building public/private partnerships, taking an active role in decision-making events, such as budget planning and legislative committee meetings, to help shape future technology programs.

Shaping Decisions, Fueling Sales

Business developers help fuel sales. Or, to use another analogy, they're like the wide end of a funnel. They perform the necessary functions to increase the company's sales opportunities.

Here's a simple "success story" example:

Let's say you know the chief technology officer at your state's Department of Transportation, a guy named Bob. Let's also say that you (who perform both inside and outside BD for a Sun Microsystems reseller) first found out about Bob by reviewing the state's DOT acquisition plan. Thereafter, you made phone calls and paid personal visits. You now have Bob's ear. Fortunately, he seems to respect your opinion.

Bob is planning to build a new statewide network for sharing highway construction information among the state's various DOT offices. The procurement is at least a year away.

Bob doesn't want to screw up. His very job depends on the success of this project. At this stage, he doesn't even know whether this new network will be built on a Unix or Microsoft OS platform. He's looking for information.

Because your company sells Unix-based computers, you need to spend every opportunity you have preaching the virtues of Unix. You attend meetings, meet Bob for lunch, write and send him white papers, etc. -- not necessarily schmoozing per se, but being helpful, providing relevant information, helping Bob do his job.

Bob has an important decision to make, and he's going to listen to both sides, the Unix side and the Microsoft side. Like an attorney before a judge, you have to be the advocate for your side and do it well.

Bob makes the decision to go with Unix. When the RFP comes out, the specifications will call for Unix hardware. NOW your company has a real sales opportunity. But without good business development, it might not have happened.

Job well done. You can pat yourself on the back.

Hiring the Right People

Larger companies will often hire "insiders," folks who used to work in government or have well-established relationships with decision-makers in government. This of course is why, for example, former DOD officials sometimes end up working for major defense contractors. These companies know full-well the importance of relationships and business development.

Not every company is large enough to hire sales people AND business development people, and certainly not large enough to hire big insiders.
Small companies, however, operating within the government IT sector should think about hiring people with business development mindsets. You want sales people (through hiring or training) that think not only short term but long term, sales people that look down the road beyond their next paycheck. (If you're lucky, you'll even have technical people with business development mindsets.)

While good sales people are fearless and want to tackle the world, they sometimes lack the inside knowledge and executive-level relationships to turn government initiatives and mandates into sales opportunities.

Good business development people set up opportunities and keep the sales force focused on high probability targets. To use one more analogy, they ripen the fruit and lead the sales force to the orchard.

Tools to Help Get it Done

At Fedmarket we constantly extol the importance of locating opportunities early and building relationships with key government buyers and decision-makers. These activities are critical in any sector, but especially in information technology (and even more especially in the area of large, complex procurements).


This article has been viewed: 12724 times

Rate This Article