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A Case for Clarity in the Definition of a Business Development Job

In our opinion, jobs with the words “business development” in the title are often incorrectly labeled. Generally speaking, business development jobs follow one of two approaches when implemented:  1) A sales orientation – there is an assigned responsibility for defined sales results as the principal priority; and, 2) A market/industry orientation –  the responsibility for sales is secondary, typically as a support or enabling role to sellers.  The principal priority is to establish a company presence in a new market or geography.

Our experience shows that over 80% of jobs titled “business development” manager or director are not truly a business development job in the classical sense of the intended role.   Mistitled BD jobs are often:

  • Designated a BD because buyers in the industry or market prefer not to deal with people in jobs titled as a “seller” e.g., Federal or government agencies like DOD, Homeland Security
  • Called business developers because incumbents are chartered to deliver large and/or long cycle sales which “develop” over time and involve many players on both the customer’s and company’s part, however, what is being sold is not new
  • Assigned to work on tasks and activities (e.g., bids and proposals) that are an essential part of winning new business, but are not the core accountabilities associated with a BD job

Invariably, jobs misclassified as business development roles create compensation problems for a company.  These problems range from setting inappropriate TCC levels, mix and/or leverage to incentive pay schemes that are inconsistent with the desired job behavior and performance.   Our case for achieving clarity in the definition of a business development job is based on the principal of paying jobs right; that is, pay for what the job is chartered to do and the results expected.

Companies that want to get past the confusion associated with misclassified BD jobs should confirm that there is a clear and shared understanding among top executives about what a true (or, classical) BD job is.  Based on examining business development practices in a wide variety of B2B industries and companies, we suggest that the job description of a classical BD job include accountability for three key outcomes:

  • Identification and qualification of new profitable growth opportunities in new markets – either new industries, new geographies or both
  • Compilation and summarization of data to size the opportunities and assess the degree of fit to a company’s current capabilities and resources
  • Development of a business plan that lays out a blueprint for shaping new solutions or offerings, the go-to-market strategy for winning new business, the roles of key functions (Marketing, BUs/Products, Sales, Finance) in making the plan a reality, and the financial outcomes expected

Our next installment to this topic will provide some examples of how the BD job is compensated when incumbents are executing to these expected outcomes.