Understanding business development concepts is essential for Bid Managers because winning bids majorly depends on how good you (your organisation) are at positioning your product/service well before the procurement cycle starts. Let’s understand the concepts in a simplified way.
We usually buy goods and services once we are convinced about the features and benefits. We buy them only when we feel they are going to fulfil our needs, desires and solve our problems. This is the case when we already know about the reputation of a product or a manufacturer or a brand.
In most cases, they are trusted branded products because we often watch them in advertisements on various media.
Quite often, some brand ambassador promotes that product to build a trust factor in us. Accordingly, we make the buying decisions. What if the product is new or when we are buying it for the first time? How do we test their authenticity? How do we assess whether it is going to fulfil our needs? We obviously try to thoroughly evaluate the products by doing various checks available. Higher the product price, tougher the evaluation task. We do an in-depth evaluation when we decide to buy a high price product.
We compare similar brands, similar products, product ratings, customer reviews, price, bonus features, discounts/offers and so many other factors when making a buying decision, including testing the trial versions.
The most important reason behind all these evaluation tasks is to verify our decision, gain confidence and ultimately build the trust factor. Once the trust is built, we buy the products. Why am I telling you all these things though you already know about them? Because you need to be on the seller’s side when you bid.
You need to understand how you are going to build a trust factor in the buyers about your offerings or products or services. Remember, in most of the bidding cases, the buyers don’t know who we are and what our product is all about. Therefore, we need to convince the buyer in every possible way.
Now, think of a situation where you start convincing the customer before the RFP is released and the customer knows you and your products well in advance. This is all about Business Development. At a high-level, with respect to Bid Lifecycle, Business Development is the process of influencing the customer well in advance to buy your products or services. Selling is a different concept.
Sale is product centric wherein you sell whatever products/services you have. It is kind of directly pushing the product to the customer. But Business Development and Marketing are customer-centric strategies, based on designing the products according to the customer’s needs. The sales are based on what you have whereas marketing is based on what the customer needs.
To simplify further, the following is the purpose of sales, business development and marketing:
- Build a strong relationship with customers
- Understand pain points of customers
- Understand pain points of end-users (customers’ customers)
- Help organisations to be ready with an exactly matching solution for desired needs of customers and their customers
- Make customers realise the unique value proposition you are going to deliver
- Convince customers to favour you (your organisation) in public procurement because your offerings are already positioned well
- Create demand if required
- Ultimately, win their hearts, not only the business Bid Managers may or may not be directly involved in this process, depending on the organisations they work in.
Ideally speaking and as per global standards, bidding organisations should not wait for RFXs to be out for public access. This is a Proactive Approach. It may or may not be possible for everyone, but the winners surely follow this. But this may not be possible (in fact, differently possible) in Public Procurement. They have to follow Government procurement policies.
The whole concept of Business Development is to connect with the customer before your competitors and plan everything required to become a preferred vendor before the customer conceives a buying idea. You must have seen some companies who bid less and win more.
On the other hand, most of the companies believe in ‘bid more to win more’ but then ultimately win a few or none. A lack of a proactive approach makes us losers in the bid game. When organisations follow the business development concepts, they focus on proactive bids instead of reactive ones.
Be with the customer, understand pain points, create the best suitable products/services before the release of RFPs, help the customer in preparing RFPs, become a preferred vendor before release of RFP, etc. Fewer the Bids, More the Win Rate.
Can we think in a different manner to be proactive before an RFX hits tender portals? Can we connect with the customers before they publish RFXs on public domains? Can we beat the competition without participating in a race? Yes, it is possible. Organisations are doing this. But it won’t happen overnight. You need to work hard to achieve this state.