We’ve already seen that a business developer can be a good friend. But what dose of this friendship is healthy for business decision-makers? Some insist on consulting a professional before making any decision, while others stress the need to remain independent. One could say that the golden mean is the answer, but there is a huge risk of being wrong if we ignore the changes of the past few decades.
Small and big
The world has changed a lot in this respect too, and the situation has become rather “two-faced”. Decades ago, a business developer would basically try to get the job done as quickly as possible and then move on to another project. The biggest consulting firms even taught that since the big jobs usually come at the beginning of the project, and since the client would have to pay for the experience and expertise anyway, they would only do it once. After that, the cost of know-how, licences, and other much more expensive lump-sum allowances simply cannot be charged under the number of consulting hours. Then, with the market shrinking, everyone tried to extend partnerships. Even when it was obvious that a job would only take a few months to complete, clients were still encouraged to work together for a minimum of one year. In fact, it became almost a slogan in business development that results should only be looked at from a year’s perspective, because that is when all the knowledge takes effect. This worked well in the days when an employee of one large company would order from an employee of another business development company. However, the market was increasingly taking an ownership approach, where they wanted to see concrete work and, of course, results. Obviously, a large proportion of small businesses wanted everything immediately, but even the owners of internationally renowned businesses were trying to rush the work. So the market began to split into two: on the one hand, there were the multinational consultancies, where clients still had the feeling that they were not rushing things and were charging huge sums for often completely useless generic solutions, and on the other hand there were the smaller, local consulting firms, where domestic businesses were emerging, and they wanted everything immediately. The biggest hit on the consultancy front came from the pandemic, when multinationals were hit hardest, as clients immediately stopped what were often ineffective and completely fruitless developments. In addition, the other pole of the market was also badly broken, as smaller, domestic firms reluctant to spend on development were looking for a miracle in that period too, and that did not come easily.
There is, of course, a happy medium in this market, just not in the way that is usually discussed. It is not really a middle way, but a third set of consultancy firms. They are the ones who have both large corporate partners and domestic, smaller business partners. They do not select their partners on the basis of size, but on the basis of expectations and professional knowledge. I have several friends who work in this set, and they often interrupt me in private conversations to avoid the “big” and “small” dichotomy, because their experience is precisely that size has not mattered in recent years, and it was even more so during the pandemic, and size does not matter at all in the business development market. They have an increasing number of large corporate engagements where the largest international consultancy firms have not even been invited to tender because their presence was deemed completely unnecessary. The decision-makers in these clients have a very high level of expertise, and they stay within their own areas of expertise and do not want to interfere in the business development work. What members of this third group of consultancies have in common is that they are governed by people who not only accept criticism, but also seek it, because they know that it is the only way to improve. And 2021-2022 is clearly all about moving forward and rethinking processes. This battle that is now developing cannot be constrained by ego boundaries. It also always amazes me how a business development company can have only successful projects, because everyone makes mistakes. It cannot be true that everything is done perfectly. Consequently, either they are not telling the truth, or there is something wrong. But there is another answer: they are good at choosing partners. Because they do have experience, and experience is not about having followed a certain amount of projects as an outsider, or having been involved but not as a manager, but only as an implementer. And if you are actually involved in business development, you know exactly what conditions a partner has to meet in order to make business development successful.