Hello,

I'm in the middle of defining the role, structure, compensational
policy and scope of a Business Development department which is in a
e-Marketing focused company that delivers services and products of
'Client' and of its own through technology and to the online
community.

The department would also be allowed to provide external consultancy
to other entities without damaging internal opportunities and
conflicting with the interest of the company it is within.

Resources of this department would be in minority internal and
majority contracted part time consultants.  Would also be dealing with
the internal business process and improving its efficiency as well as
internal workflow automation I would think would be fitting.

Would like your opinion and experience in this area and please allow
me to question and ask for clarification and explore. :-)

Thank you.

/Mao

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Request for Question Clarification by omnivorous-ga on 21 Jan 2004 12:37 PST

Dustydune --

You'll want to be as specific as possible with an area such as
business development.  I've been in companies where it has been used
for:
*  new channel exploration (for example, adding programs to develop
and education market within a multi-channel company)
*  international business development.  Each country uses slightly
different distribution models, so BD people would be given the task of
initiating that work.
*  taking a technology outside a core market area.  An Internet
company may have developed code that is licensable to other segments
of the software business, as one example.
*  partnering programs between two companies: such as Intel and
Microsoft working together to develop products specifically for
consumer electronics.
*  use of technical expertise in consulting, with the aim of finding
new 'standard' product areas that can be sold.  It's not too
dissimilar from the model being pursued by Business Objects (NASDAQ:
BOBJ), with dashboard and business intelligence products:
http://www.businessobjects.com/
*  developing new technology jointly.  I worked for Zenith, which was
a leading producer of picture tubes -- but we used a business
development person to develop a close working relationship with Sanyo
to deliver the first illuminated portable computers.

Google Answers works best if you can get to very specific questions. 
It doesn't work well if researchers don't have a concrete example of
the type of contract or relationship that you're seeking.

Best regards,

Omnivorous-GA

---

Clarification of Question by dustydune-ga on 21 Jan 2004 16:09 PST

Hello Omnivorous,

Thank you for the pointers, I do see what you mean now.  Allow me to
list a few elements that may narrow down the role definition:

1. Sales and distribution aware.
2. A personality that establishes relationships that make sense.
3. Information technology and telecommunication industry experience.
4. Conceptualization and presentation of new ideas and services.
5. Dealing with international parties for sales, marketing and product development.
6. Plan, develop and execute marketing strategies and brand building.
7. execute market research and keep a close eye on the competition to
distinguish our brands/services/products from the rest.
8. Develop seasonal promotional programs.
9. Conducting analysis of sales, market share and distribution of the
services/products periodically and plan short and long term solutions.
10. Establish proper internal staff and resource performance
measurement methods and rewarding mechanisms.
11. To what extend does the department incubate new ideas? Where does
it move over to those whom pick up the ball and run with it to earn
their bread instead of the BD department taking up the headache for
that without the rewards or the resources.
12. The department would also hire legal counsel and manage the
creation of appropriate contractual documentation to protect the
interests of the company during and after the development process.
13. Develop a method to measure ROI on services/products as a reality
check just in case they go overboard in being great ideas that can
only produce cost.
14. Research and Development needs to be covered within this
department and most of it is going to be contained within online,
ecommerce, e-marketing and intelligence serving them all.

That's what I've been able to come up with for now. :-)

Thank you.

/Dusty.

---

Request for Question Clarification by omnivorous-ga on 22 Jan 2004 11:56 PST

Dustydune --

A couple of comments:
*  you're giving BD the responsibilities that typically belong in
other departments, such as sales or marketing (see your items 6-10,
among others)
*  BD typically acts to see whether there's business/market/channel in
some arena where your company can act jointly with another company to
do something you're not capable of doing today.  That might be as
simple as selling into the college market or involve development of
new products.
*  senior management should never give up close control of #12 to any
functional department.  One only has to read casually about the Enron
case to see how legal and revenue mechanisms can be distorted.
*  The issue in #11 seems to be the crux of your question.  I'd
suggest answering it by giving you about 5 cases of how companies have
used a business development function.  Recognize that while the
disciplines of sales, marketing, engineering, finance and
administration are well-defined, you'll see all of the models that I
mentioned in the first Clarification Request being called "Business
Development."

Best regards,

Omnivorous-GA

---

Clarification of Question by dustydune-ga on 22 Jan 2004 13:50 PST

Hi Omnivorous,

You're explanation is understood and I agree with you and as to the
points where you feel there's a terrible amount of over trust as well
as scope overlap, the following may justify some of it:

1. It's a small start up company, so they don't have resources or the
expertise in the other departments in the niche market being ventured
into nor the method of service delivery to allow for immediate
independence.

2. The scope I've suggested in the sales and marketing areas is
temporary till those departments get a grip and hire people to fill
vacancies.

3. I agree with you that eventually the BD department should settle
down to the role of complementing what the company does by leveraging
it along with other companies to do what it can't do on its own
instead of increasing headcount and risk of trying to be too many
things.

4. The legal counsel I've mentioned is to help with NDA's and
contracts with partners and affiliates.  Nothing major. :-)

5. I've also gone into HR scope where performance measurement and
compensation shouldn't be a BD role, but because there's no HR
department and till one can be justified and a workload and staff get
budgeted to get them rolling, it'll be the BD's role, along with
outside help, to setup how people should be rewarded and measured so
we don't lose business and good people because we didn't have the
right department and skills internally present from the beginning.

6. Would you list the five cases in the e-service area if possible? 
Also, if you feel there's a case where it isn't 'e' enough, but
delivers an important value point, then so be it.

Can we also come up together with a job description for the BD
department after discussed the cases?  I need to be done by Friday
evening with this, so if you'll allow me to inconvenience you with a
time frame for your portion to be completed, I'll add a 20% bonus to
this question. :-)

Was I imagining things or did the system go off-line today?

Thank you.

/Dusty

---

Request for Question Clarification by omnivorous-ga on 22 Jan 2004 14:15 PST

Dustydune --

Yes, the web pages were down from late Wednesday to early Thursday (PST).

I'll chase down some cases over the next several hours to give you an
idea what's available, concentrating on e-businesses.  My background's
in PC and software marketing, so I'm very familiar with the space.

Having worked at a startup in my last venture, I'm familiar with how
people have to wear multiple hats.  However, I'm sure that you know
it's important to keep people focused on the 3 main objectives.

BD is the one area which routinely brings together ad hoc teams for an
opportunistic project -- then acts to transition the new opportunity
to the mainstream business.

Out of curiousity, where are you guys based?  Are most of your BD
opportunities going to be in the U.S. or international?

Best regards,

Omnivorous-GA

---

Clarification of Question by dustydune-ga on 22 Jan 2004 14:40 PST

Hi,

Glad you have the right background for this! :-)

We're in EMEA and yes international.

/Dusty

Dustydune --

Business development has become so common that it's difficult to find
a focus on the Internet.  Cities and states have business development
functions; even accountants use the term for new client prospecting!

Inasmuch as we've discussed various aspects of defining business
development, it's important to set the mission for BD.  It may be to
build partnerships that increase sales.  That's the most-common goal. 
Or it may be to build partnerships to develop new products.  This is
the first area of scope that you'll want to define.

The second is to identify the strengths that you believe that you have
to offer potential partners.  Consider doing a SWOT analysis to help
identify these -- and the direction that you want you business
development to address.  And in a small company environment it's
important to act quickly, rather than taking months to analyze each
aspect in detail:
QuickMBA
"SWOT Analysis" (2003)
http://www.quickmba.com/strategy/swot/

There is some information theory behind this type of business
leveraging in Metcalf's Law, which says that the value of the network
equals the SQUARE of the number of users.  So, doubling the customer
exposure will give you FOUR times the business reach:
Southwest Missouri State University
Metcalfe's Law (Boyd, Dec. 4, 2003)
http://www.mgt.smsu.edu/mgt487/mgtissue/newstrat/metcalfe.htm


WHAT IS BUSINESS DEVELOPMENT
==============================

This is a very high-level view of setting up business development,
focusing on partnering programs:
Vista Consulting
"Building High Impact Alliance Programs"
http://www.vista-consulting.com/Articles/Article_HighImpactAlliance.htm

This consulting firm has done a good job of defining the
cross-functional role of business development within an organization:
Kizuki e-Business Consulting
"What is Business Development?" (Choudhary, undated)
http://www.kizukigroup.com/ebusiness/What%20is%20Business%20Development_edition.pdf

Contractor Resource, a website serving the construction industry, has
a surprisingly good step-by-step definition of how to implement
business development within any type of company :
Contractor Resource
"Why Start a Business Development Program in Your Company?"
(Humrickhouse & Roper, undated)
http://www.contractorresource.com/cgi-bin/article_display.pl?art_id=39



BUSINESS DEVELOPMENT CASES
=============================

You probably can't look at an e-commerce space and co-marketing
without looking at what Amazon.com has done to go from being an online
bookseller to an online department store.  This article pre-dates most
of the moves (and investments) that Amazon.com has made in the space:
CIO.com
"Jeff Bezos Takes Everything Seriously" (Aug. 1, 2000)
http://www.cio.com/archive/080100_bezos.html

This updates somewhat the Amazon partner model:
CIO.com
"Amazon.com: software vendor" (Varon, Oct. 15, 2003)
http://www.cio.com/archive/101503/tl_ec.html

(CIO.com is generally a good resource on e-commerce and Internet
issues.  There are over 650 references to business development, if you
do a site search on their web pages.)

If Amazon.com's business model is close to what you're seeking, I
might suggest drilling down into their contracts with partners.  You
can see the tip of the iceberg in the company's work with
Drugstore.com -- what's paid for advertising and marketing rights, as
well as Amazon's interest in investing in e-commerce partners here:
"Sephora.com and Beauty.com" (Omnivorous-GA, Jan. 13, 2004)
http://answers.google.com/answers/threadview?id=295542

You might also choose to read portions of the Amazon annual report,
which discusses the company's strategy.  All of Amazon's financial
reports are here and the most-recent annual report was for 2002:
Amazon.com 
"Investor Relations"
http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-irhome


BEST PRACTICES
===============

The Information Technology Association of American (ITAA)  has a
series of "Best Practices" pages for technology companies.  In it they
have a section on strategic alliances, often the core of business
development strategy.  The ITAA page has 7 different perspectives on
alliances, including those of Bob Herbold, former chief operating
officer at Microsoft:
ITAA
"Accelerating Growth Through Strategic Alliances" (undated)
http://www.itaa.org/software/act/acgwsa.htm


BUSINESS DEVELOPMENT & E-COMMERCE
=====================================

A Google search turns up a very interesting article by Donald La Vie,
Jr. of Integrated Concepts that treats the process for e-commerce
companies.  It turns out that you might have to use the Google HTML
link to read this interesting paper, as the original link is not now
available:

"Writing Killer e-Commerce/IT Proposals that Win New Business" 
http://216.239.53.104/search?q=cache:SusZgzsQxhsJ:www.stc.org/proceedings/ConfProceed/2000/PDFs/00117.PDF+%22establishing+business+development%22&hl=en&ie=UTF-8


SOME OTHER RESOURCES:

Here's an IT manager who set up a business development function to
track the real needs of in-house departments within Johns-Manville:
CIO.com
"To Serve Them All Your Days" (July 1, 2000)
http://www.cio.com/archive/070100/serve.html

A consulting company's services in online partnering or business
development help define the functions:
01 Consulting
"Alliance Services"
http://www.01consulting.net/02_services_e_alliances.htm

Another example of a consulting firm performing a business development
role with a lighting company:
YTKO
"Sentec --  New Company Spin Out and Launch" (2003)
http://www.ytko.com/portfolio/venture/YTKO_venture_Sentec.pdf

One of the well-reviewed books on e-commerce is May & Orchard's "The
Business of Ecommerce : From Corporate Strategy to Technology,"
Published by Cambridge University Press in 2000.  At Amazon.com, the
book listing allows you to look at the table of contents and other
information.


Any Google search strategy has to go beyond the term "business
development" because those 2 words alone will turn up hundreds of
thousands of websites with every person having the title.  So, here
are some of the ways that we did the search:
"what is business development"
"Business development" + definition
"business development" + "e-commerce"
"business development" + "job description"
"business development" + "best practices"
"business development resources" + e-commerce
"alliance programs" + "business development"


You may also find this outline of a marketing plan for an e-commerce
site to be of interest, as it treats partnering for business
development:
"Marketing Plan for creating e-business using existing website"
(Omnivorous-GA,  Dec. 6, 2003)
http://answers.google.com/answers/threadview?id=278523

Finally, in the U.S. online job search sites can be a good resource
for a position description.  You'll find a wide range of duties for
what's termed business development at any of these popular sites (and
thanks to researcher CZH-GA for suggesting this resource).  Of course,
the higher level positions have broader scope and many of the
low-level positions should really be titled "sales".

Monster.com Home page
http://www.monster.com/

DICE Home page
http://www.dice.com/

Craigslist Business/Management jobs
http://www.craigslist.org/bus/

Hotjobs Search
http://hotjobs.yahoo.com/

You may also wish to check the Wall Street Journal and certain
professional publications to see what's being done in your industry
segment.

This should give you a variety of resources to define the job function
and write a job description.  However, if any part of this Google
Answer is unclear, please let me know with a Clarification Request
before rating the answer.

Best regards,

Omnivorous-GA

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Clarification of Answer by omnivorous-ga on 23 Jan 2004 07:29 PST

Dustydune --

Culpepper is a firm that tracks compensation by job category.  Here's
their very succinct definition of what a BD manager does:
http://www.culpepper.com/pay/jobs/templates/BriefDescription.asp?txtJobCode=5982

Best regards,

Omnivorous-GA