Many public and private organizations have determined that one of the most important ways to grow and scale is through “Business Development” which means mergers, acquisitions, licensing, investments, options-to-buy, and several other investment vehicles.
We have seen an exponential growth in Business Development in pharmaceuticals, chemicals,
consumer packaged goods, manufacturing, technology, and even professional services,
In the past, these same companies had a culture and philosophy of “If it’s not invented here, we don’t want it,” but those days are long gone because of the inherent risks associated with a strategy that thinks an organization can do everything perfectly. Business Development is all about mitigating risk and at the same time increasing the quality of products, services, and overall efficiencies.
From a business acumen skills perspective, it takes a new and different mindset to build the organizational capabilities to successfully create and execute a strategy and culture of Business Development.
I am pleased to share 7 different business skills needed to achieve Business Development success. We will follow up this blog with another one focused on the business leadership skills needed to execute a Business Development strategy.
Business Ecosystems: A Business Development strategy requires a deep understanding of business ecosystems, and market landscapes, including competitors, customer needs, and industry trends. Developing this understanding enhances business acumen by providing insights into market dynamics and opportunities for growth.
Customer Centricity: Business Development strategies are often centered around understanding and meeting customer needs. Developing a customer-centric approach fosters a deeper understanding of customer behavior, preferences, and opportunities, enabling organizations to deliver value-added solutions and build long-term relationships. Strengthening customer focus enhances business acumen by aligning business activities with customer expectations and driving sustainable growth.
Strategic Thinking: Business Development initiatives often involve strategic partnerships, alliances, and potentially entering new markets. Executing these types of strategies can be ambiguous and requires strategic thinking, creativity, and the ability to assess risks, anticipate challenges, and align actions with long-term business objectives such as creating shareholder value.
Financial Literacy: Implementing a Business Development strategy involves financial analysis, including forecasting revenue, understanding cost structures, understanding cash flow, and determining return on investment (ROI). This strengthens financial literacy and the ability to interpret financial data, improving business acumen in financial decision-making.
Collaboration across the Enterprise: Implementing Business Development strategies typically involves collaboration across different functions within the organization, such as sales, marketing, finance, and operations. Engaging in cross-functional collaboration enhances business acumen by providing exposure to diverse perspectives and fostering a holistic understanding of how different parts of the business work together and connect to drive growth and meet objectives.
Risk Management: Business Development initiatives inherently involve risk, whether it's entering new markets, investing in new technologies, or forming strategic partnerships. Developing effective risk management strategies is essential for mitigating potential threats and maximizing opportunities. Enhancing risk management capabilities strengthens business acumen by promoting a proactive approach to decision-making and a deeper understanding of the interplay between risk and reward.
Strategic Business Negotiation Skills: Business Development often involves negotiation with potential collaborators, acquisition candidates, partners, customers, and suppliers. Developing effective negotiation skills is crucial for securing favorable deals and building successful relationships. Enhanced negotiation skills contribute to better business acumen by optimizing resource allocation and maximizing value for the organization.
In summary, the more organizations grow and scale through Business Development, the greater the needs for these business acumen skills will be. In part 2 of this blog series, we will explore the business leadership skills to execute and support a Business Development strategy.
