Business Development

Question 1

What is Business Development?

Answer 1

Business development is creating long-term value for an organization from customers, markets, and relationships

BD is all about creating opportunities to pursue value

Question 2

Economic Value

Answer 2

The fundamental way we think of value in the context of business - increased revenues/profits

Question 3

Brand Value

Answer 3

The overall benefit of changing the perception of the company in the eyes of our partners, customers, and prospective customers

Question 4

Product Value

Answer 4

The increase of intrinsic utility of a product or service

Increasing product value allows you to increase price, attract new customers, or keep more of existing customers

Question 5

Audience Value

Answer 5

A type of potential value realized by increasing a company or product’s exposure

Question 6

Option Value

Answer 6

The value derived from retaining a future choice that has potential to be valuable in its own right

Question 7

What are the sources of Value?

Answer 7

Customers, markets, and relationships

Question 8

What are the types of Value?

Answer 8

Economic, brand, product, audience, option

Question 9

Markets

Answer 9

Where your current and perspective customers live

There are two kinds of markets:

• Geographical markets (NY or LA)
• Value mindset markets (pet-owners)

Question 10

What functions is BD composed of?

Answer 10

Sales, strategy, partnerships, and relationship management

Question 11

Sales in BD

Answer 11

Instead of selling a specific product, you are selling the idea that a partnership will bring value to both parties

Question 12

Strategy in BD

Answer 12

Strategic thinking is necessary for figuring out the best paths for reaching new customers and for entering new markets

Most prevalent in the build v. buy v. partner consideration

Question 13

Partnerships in BD

Answer 13

Generally, the fastest, cheapest, and easiest way to reach new customers and markets

Question 14

Distribution (channel) partnerships

Answer 14

When one company has access to a market that the other is looking to connect with

Question 15

Product Partnerships

Answer 15

When two companies work together to create a new product, or enhance an existing product

Question 16

Brand Partnerships

Answer 16

When companies work together to jointly promote and cross-promote their products and services

Question 17

Relationship Management

Answer 17

BD people must know how to build and manage relationships with stakeholders

All relationships require two things:

• Strong foundation of trust, respect, and integrity
• Mutually beneficial exchange of value

Question 18

3 Steps in Determining Opportunity Viability

Answer 18

• Identify the opportunity
• Assess the opportunity
• Evaluate the paths

Question 19

Identify the opportunity

Answer 19

The process of thinking about your business and identifying ways to create more value from CM&Rs

Any gaps compared to competition? Additional products or features? Competition areas of strength? Something to do better? How to enter a new market?

Question 20

Assess the opportunity

Answer 20

There are two key parts to any opportunity, the benefits and the costs

• The benefits are quantified based on the assumptions in value derived from the opportunity
• The costs are a function of the resources spent in pursuit of the opportunity
  - Also consider the opportunity cost

Question 21

Evaluate the paths

Answer 21

he way that the opportunity ultimately becomes a reality; takes place in three forms:

Build - Slowest, most control, resource intensive
Buy - Potentially fastest, maintain control, risky and expensive
Partner - Fast, lose some control, shared risk and less expensive

Question 22

Why should companies invest in business development?

Answer 22

Partnering is the fastest, most-effective, lowest risk way to solve for an area of weaknesses

Reasons to partner:
- Increased revenue as a result of being able to offer customers a fuller and more complete solution.
- Reduced Costs
-lower cost parts of the whole product solution from a
larger partner’s economies of scale
-reduce market entry and development costs through
extension of company’s organic distribution systems
-New knowledge, skills sets and opportunities to your
organization fast
- Expanded reach and market share resulting from access to the larger company’s sales force/channels.
- A boost in credibility, brand, and product exposure
- Defense mechanism so your competition can’t partner
with them

Question 23

When Should Companies Invest in Business Development?

Answer 23

When they have achieved the following:

• A working product
• Product market fit
• Internal resources to support initiatives
• Market Leverage - Why Me?
• Ability to operate solo

Question 24

Four common types of BD relationships

Answer 24

Product - relationships that enhance the end product

Distribution - provides distribution for your product/service

Brand - relationships that enhance the brand

Channel - partners with a company, to market and sell a product

Question 25

Key Considerations for BD Growth Strategies

Answer 25

What are your levers?
o How can you drive them?

Who is your customer/user base?
o Where do they congregate with intent?

What is the best way to reach these people?
o Product, brand, distribution, channel relationships?

Question 26

Partner Considerations

Answer 26

o What type of customers do they serve?
o How many do they have?
o Is there a culture fit?
o Is their desire for a relationship as strong as ours?
o Do they plan on building something similar?

Question 27

Partner Market Evaluation

Answer 27

What is the size of the market, given your strategy?
o Are there enough to make this effective?
Are these relationships repeatable, or are they mutually exclusive?
o Sharing previous partner data with new partner