YOUNG PROFESSIONALS

MANAGEMENT TRAINING PROGRAMME

WEBINAR

CREATING A BUSINESS DEVELOPMENT FRAMEWORK

Edited by:
Felix F Fongoqa PrEng
Presented by:
Steen Frederiksen
Andrew Steeves
Robin Crouch

International Federation of Consulting Engineers

 STRUCTURE OF PRESENTATION

 Business Development: A definition

 Business Development Framework

o Business Development Strategy
o Marketing Plan
o Effective Sales Programme
o Client Relationship and Communication

 Conclusion
 1. BUSINESS DEVELOPMENT: A DEFINITION

Business development may be defined as follows:

“The creation of long-term value for an organisation from

customers, markets and relationships”.
 2. BUSINESS DEVELOPMENT FRAMEWORK

Marketing, sales and client relationships must work together to

generate business leads, optimise close rates and generate cash
for the business

A clear and concise strategy

A detailed marketing plan

An effective sales programme

Focused client relationships and communication channels

 2.1 BUSINESS DEVELOPMENT STRATEGY

Some of the themes for developing a strategic agenda:

 Futures thinking

 Strategic intents
o Goals and objectives
o Core business
o Existing and desired core competencies
o Customer segmentation
o Customer value proposition
o Positioning
 2.2 MARKETING PLAN
 Market Analysis

o The Industry

o Target Market (Market Segmentation)

o Competitors analysis, including SWOT analysis

o Competitive advantage

 Definition of the service offering

 Market Positioning

 Unique selling proposition

 Selling model

 Branding

 Pricing strategy

 Business development organisation and Budgets

 2.2.1 Market Segmentation (PAGE 1 OF 2)

Markets can be segmented by:

• Geography

• Demographics

• Products or services

• Public or Private

• Economic Sector (Industry, resources, infrastructure etc)

 2.2.1 Market Segmentation (PAGE 2 OF 2)

Some advantages of market segmentation

 focuses the marketing efforts

 increases competitiveness, resulting from:

 higher brand recall

 brand equity

 customer retention

 better communication

 increases profitability
 2.2.2 Industry/Market Attractiveness

Michael Porter’s “5 forces that shape and influence the industry or market”:

Strength of barriers to entry

Extent of rivalry between firms:

Supplier power:

Buyer Power

Threat from substitutes:

Other factors: Political, Economic, Social and Technological

 2.2.3 Strategic Positioning

Delta model :

 3 Distinct Strategic Options for companies

 Options for Strategic Positioning of the firm

 2.2.3.1 The 3 Distinct Strategic Options
System Lock-In
• System Economics
• Market Dominance
• Achieving Complementor Share

Total Customer Solutions Best Product

• Customer Economics • Product Economics
• Cooperation • Rivalry
• Achieving Customer Share • Achieving Product Share
 2.2.3.2 Options for Strategic Positioning

System Lock-In

Dominant Exchange Proprietary Standard

eBay, Yellow Pages Microsoft, Intel

Exclusive Channel
Rural Wal-Mart
Horizontal Breadth Low Cost
Fidelity Southwest Airlines,
Nucor
Total Customer Redefining the
Solutions Customer Best Product
Customer Relationship Differentiation
Integration Saturn Sony Wega
EDS
 2.2.3.3 Strategic Positions of the Total Customer Solution Option

Strategic Position Definition Comments

This positioning is based upon

an intimate knowledge of the
The focus is placed on considering the full
Redefining the customer, leading towards
experience of the customer from the point of
Customer effective customer
acquisition through to the complete lifecycle
Experience segmentation and a
of ownership of the product.
differentiated customer value
proposition for each tier.

This strategy seeks to provide full support of

customers’ activities by transferring The firm is regarded as a
knowledge to improve their performance. It bundle of competencies that
Customer
involves a high degree of outsourcing, which will be brought to the
Integration
develops a complex way of connections with customer to boost the
customers that enhance their ability to do customer profitability.
business and to use your product
 2.2.3.4 Strategic Positions of the Best Product Option

Strategic Position Definition Comments

Since there is only one lowest

cost producer, this strategy
leaves very little space as a
competitive position. It also
Focus on being the lowest cost provider tends to standardize the
Low Cost
in an undifferentiated product category. product offering, commoditize
the customer, and intensify
rivalry

Focus on the development of features

and functionalities that make the As soon as the differentiated
Differentiation product/ service unique and allows to product emerges, competitors
demand a price premium from the tend to imitate it.
customer.
 2.2.3.5 Public Sector Positioning

Quality is usually a differentiator, with cost playing a role in the final selection.
Normally one of two methods:

 The two envelope system where a benchmarked score for quality is used to
determine whether or not the price proposal should be considered or

 A scoring system whereby the weighting for the score is skewed towards quality,
usually at 70 for quality and 30 for price.
 2.2.4 Branding (PAGE 1 OF 2)

“YOUR PROMISE TO YOUR CUSTOMER”

o Defines expectations, differentiation

o Derived from who you are, who you want to be, who people perceive
you to be

Branding is not just a logo or corporate identity as is normally assumed. It

incorporates these elements, but is also embedded in the benefits of your
products/services such as quality, customer service, value proposition etc.
 2.2.4 Branding (PAGE 2 OF 2)

 Consistent, strategic branding leads to strong brand equity (e.g. Virgin)

 Sometimes it is preferable to have a group of companies bearing

totally different brand identities, particularly under the following
circumstances:
o Shareholding in a subsidiary is a JV
o Subsidiaries pursue independent aims and business strategies
o Independence of external influences is a key success factor for a
subsidiary or related company
 2.3 SALES (PAGE 1 OF 4)

 All marketing efforts must be designed with an objective of generating reliable

business and project leads, culminating in sales.
 Consulting engineers sell a service/product that a client cannot see
 Written proposal and/or oral presentation must inspire TRUST.
 Trust has two elements to it, namely, the rational and non-rational.
 The rational elements:
o measurable and the rules of objectivity apply
o demonstrate expertise and experience
 The non-rational elements:
o differentiator
o feeling of safety
o Self- orientation
 2.3 SALES (PAGE 2 OF 4)

Application of non-rational elements influenced by:

 Risk and consequences of failure or the potential rewards of success

 Size, complexity and ill defined project

 For acquiring a new client with large, complex and poorly defined projects, larger
firms use a team approach, typically performing the following roles:
 2.3 SALES (PAGE 3 OF 4)

Team Role Expected Impact

Closes the deal, fully understands total solutions selling. Has mastered
Rain maker
services selling techniques
Solid working understanding of the product and services side of the
business and can communicate strategically as all levels of the
Business relationship. Faces the marketplace without fear and believes strongly in
Developer the company and its solutions capacity. He is the one who creates
beachhead and opens doors for the closer or technical experts to
participate.
A data master who assists the team in understanding the prospect’s
Market needs, place in the marketplace, and greatest industry challenges. He
Researcher provides input to the team and related trends, best practices, and
information on competitors.

Specialist Provides technical insights and credibility to the team.

 2.3 SALES (PAGE 4 OF 4)

Building Trust:
 Engage
 Listen
 Frame
 Envision
 Commit

At the beginning of the process, credibility and reliability—the rational skills—are key.
It is in the middle three steps—listen, frame, envision—that non-rational elements
become critical. Trust-based selling thus puts more emphasis on the middle three
steps—those critical to building the non-rational trust components so key to
professional services sales.
 2.4 CLIENT RELATIONSHIPS AND COMMUNICATION

o Chapter 8 of the FIDIC Guide to Practice covers this topic

o The same three middle steps: Listen, Frame and Envision

o Everyone in the project delivery process must be trained in communication skills

and building lasting client relationships.

“If you truly care about your clients, they’ll care about you”
 CONCLUSION

Parable: What would you do if you had only one customer

Strategy, Marketing, Sales, Client relationships and communication are a continuum

which when applied with great care and skill can increase the company’s revenue and
build long term value for its stakeholders.
WEBINAR YPMTP 2017

Case Questions 1 - 13

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• Business Development
•
• Your company has developed quite rapidly in recent years, partly through organic
growth of the traditional civil/structural consulting business and partly by adding a
number of high profile specialities by acquisition. This expansion has left a number of
customers quite confused, because the services offered cover a different and much
broader scope. It has also left the company with the challenge of establishing quite
another image in the eyes of the general public not to mention potential applicants for
jobs in the organisation.
•
• In the domestic market the backbone remains the traditional consulting jobs that are
plentiful and with relatively low fees, however, the increasing number of specialist
services requires innovative approaches, investment in research and development and
consequently much higher fees than the company used to charge.
•
• In foreign markets the company is picturing itself as multidisciplinary and in relation to
large projects benefiting from the many disciplines covered.
•
• Q 1: Describe a marketing strategy for this development.
•
• Q 2: How would you plan, budget, control and assess the results of this marketing
effort.
•

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• Branding the company towards clients and the industry, and for that matter the general
public - becomes quite complicated. The clients are targeted through a constant flow of
articles and advertisements in technical papers based on individual project cases,
emphasizing the individual and seemingly independent business units.
•
• The company tries to attract young professionals by picturing small units with highly
specialized staff providing state of the art technology and at the same time promoting
the attractiveness of large international and multidisciplinary jobs.
•
• Q 3: Define management structure incl. risk management catering for an international
and multidisciplinary company.
•
•
• However, the group financial results are disappointing in particular compared with its
competitors. This is caused primarily by an inability to obtain the high fees required in
the specialized divisions and on international jobs because of much higher promotion
(proposal) costs.
•
• Q 4: How would you solve this problem in the domestic market and in the international
market.
•

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• It turns out that the expected results from some particularly high tech, high profile projects in
the domestic market are technically not up to standard. The company faces a situation with a
risk of loosing its high tech, high quality image.
•
• You have the following - to some extent alternative - possibilities:
• (A): Reorganising the company into one large unit with a single, efficient QA function
• (B): Changing the approach from selling technology to selling trust
• (C): A general branding effort emphasizing results, quality, reliability, financial standing
• (D): Develop a global brand drawing on all resources from all countries
• (E): Change all marketing to be internet based
•
• Q 5: How would you organise business development in a multidisciplinary and multinational
firm. Are you local globally, adapting to the individual market, or do you draw on the whole
range of capabilities everywhere.
• Q 6: What are the pros and cons of the proposed marketing strategie
• Q 7: Is small beautiful but big better – or is this simply not true !
• Q 8: What will be the most important marketing features in the future ?

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• The marketing initiatives chosen turn out to be very successful, turnover
grows, more people are employed and suddenly the financial people
sound an alarm. The company’s bank connection is asking critical
questions related to the overdraft, starting up new projects require
liquidity, outstanding invoices are skyrocketing etc. Project Managers
seem to be more concerned about quality and progress than about getting
invoices out and paid. Minor problems cause clients not to pay.
•
• The auditors suggest to split the company in separate, independent
divisions and to develop a completely new and more efficient financial
management system for the entire organization.
•
• Q 9: What measures would you take to solve the liquidity problems. How
do you reduce the outstanding payments.
•
• Q 10: How do you improve budgeting procedures

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• One of the reasons for the poor liquidity turned out to be that invoices
create a lot of discussions with clients because of minor mistakes, lack of
clearly defined payment guidelines and poor communication in general
resulting in substantial delays in payment.
•
• Q 11: What measures do you propose to take to solve these problems.

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• A task force is established to analyse projects where the final result deviated
substantially from the budgeted result. Among the key findings are: design
errors and poor definitions of services in the agreements in question, as well
as lack of attention to the preparation of payment schedules in the
agreements made.
•
• Design errors and the like also were found to cause a substantial increase in
Professional Indemnity insurance cost, which over time is becoming a
considerable overhead item. The many insurance cases started to weaken the
Clients’ confidence in the company. The previous reputation for solid
technology and reliable delivery became more and more difficult to maintain.
•
•
• Q 12: Define the necessary quality assurance measures
•
• Q 13: How to reduce design errors and regain the Clients’ confidence
•

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 Further information on FIDIC
Young Professionals Management Training
Programme

A brief presentation: http://ypmtp.org

A more detailed account:

http://fidic.org/sites/default/files/event-
files/FIDIC_YPMTP2017_Flyer.pdf

YPMTP 2014 Video

https://youtu.be/Bny_6vYUS6c

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