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This post is about business development (BD).
There's a BD ailment in the professional services markets (and other markets I suppose) which I call, "Shiny Penny Syndrome".
Symptoms include short attention spans, misplaced time allocation and indifference to existing prospects. The time professionals have for BD is finite and good BD takes time. What often subverts efficient use of their time, is Shiny Penny Syndrome. It works like this...
We're all so eager to attain revenue goals, that all it takes is a simple distraction to catch our eye (i.e. a shiny penny). The promise of a hot lead at a new prospect often retards efforts at existing prospects by shifting valuable attention and resources away from them. Frequently, we drop everything to chase a sale at an unqualified prospect requiring a time consuming proposal with a quick turnaround.
It's impossible to avoid that shiny coin 100% of the time, but when we pursue them habitually, we're trading higher probability conversions in our existing pipeline, for long shots.
I'm not advocating slow starts to reasonably-qualified, time sensitive, opportunities. I'm suggesting there's an unacknowledged price to pay when professionals repeatedly turn their energies toward unqualified prospects seeking fast fee quotations, project budgets, proposals, conference calls, etc. It all takes time.
Professionals can't totally inoculate themselves from Shiny Penny Syndrome -- it requires discipline to walk away from pursuits that appear quickly and often dramatically. Emotions can run high on both sides of a decision to pursue or not pursue the new "opportunity". Nobody wants to appear as though they lack aggressiveness. So how can we reduce our exposure to unhealthy pursuits of shiny pennies?
One method is to calculate your ROI for these pursuits (and share among market-facing peers). Total the estimated fees coming from wins of these pursuits over a twelve month period or longer (a dollar value easy to compile because data points will be sparse). Next, attribute a reasonable dollar value for the sum total of all the time and resources expended on shiny penny pursuits, over the same time period. Next, divide the estimated fee value, by the total time and resource value. That's your ROI for these moonshots.
Another method, and a more preemptive one, is adoption of an opportunity assessment standard. Even a few qualification questions consistently considered, are better than nothing. Use questions to assess unknown, proposal-anxious prospects and arrive at an informed team consensus on how (or whether) to proceed with a given pursuit.
I close with some sample questions below.*
- Will direct contact with stakeholders and decision-makers occur before proposal development?
- How many competing firms will the prospect allow into this RFP process?
- What market reputation do we possess for this specific type of work?
- Do any C-level executives or board members at the prospect, already know us?
- Does the RFP process more closely resemble a commodity auction run by procurement managers, or a thoughtful vetting of individual firms by key stakeholders?
- Why were we invited to participate?
- Why is the prospect going out to bid?
- Is there enough time to develop a sufficient understanding of the prospect's business?
- Can our experience and existing relationships produce unique value and insights, or merely rates and dates in a proposal?
- To what extent can geographic proximity or similar reference-able clients, weigh in our favor or against us?