The New Business Development

The New Business Development

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Introducing the new business development…

Business development has been in redesign for a few years already. In technology, it has taken a turn to building communities and understanding their needs before releasing a product or service. In fact, business development is done successfully now because of this change.

It used to be that salespeople earned commissions in order to get excited about selling, to “increase the value of the business”, but that’s no longer the case.

 In his book, Drive: The Surprising Truth about What Motivates Us, Dan Pink cites research that indicates extrinsic rewards, such as sales commissions or other financial rewards, do work well under certain limited conditions: when a task simply requires people to follow a formula, such as Adam Smith’s famous pin factory. But for jobs that require complex or creative thinking, extrinsic rewards can be dangerous, because they tend to restrict people’s ability to notice things on the periphery and craft novel solutions.

Pink’s prescription is that in a world that increasingly requires people to think creatively, solve problems and remain flexible in uncertain environments, extrinsic incentives don’t work, and we should instead focus on the kinds of intrinsic motivation that drives artists, inventors and other creative professions: mastery, autonomy and purpose.

Handy definitions on the difference between extrinsic and intrinsic motivation for your educational purposes here.

In business, creative success is only part of the equation. The great innovators in business did not succeed on creativity alone; their success was a blend of creative thinking plus business logic. They blended creativity with business sense and a deep understanding of customers and market dynamics.

The challenge in aligning incentives goes like this:

First, incentives must be real and tangible enough that people can see the impact they have on the business as a whole; second, they should balance long-term and short-term thinking; and third, they should balance rewards so they reward people for things that make the business as a whole healthier and more successful.


>>> Where business development finds support now.

Organizations were designed by splitting them (and the labor) into divisions, in order to do work more efficiently. Software developers sitting together so they can focus on software; salespeople together so they can focus on selling and learn from each other, etc.

Yet as we move into a world where efficiency leads to commoditization, and where value will increasingly be driven by innovation and skills, efficiency is no longer the ultimate goal.

How can we divide the labor in new organizations to optimize for innovation rather than efficiency? One idea: to supplement divisional thinking with another approach that is based in dividing labor into functions and specialties.

People in a functional group tend to identify with each other more than they identify with the purpose of the organization. By doing this, we divide labor into “businesses within the business,”. This approach allows a large company to act as if it were made of a swarm of small companies; it gives the whole a level of flexibility and adaptiveness that would never be possible in a divisional organization.

Businesses are developing by allowing cross-connections inside the organizations, all supporting self-forming teams, all working towards a goal in common. Business development is building strategies based in a newfound support: every team member in an organization.

>>> If that sounded unusual, here are two examples.

 Morning Star

At Morning Star [website], workers manage themselves and report only to each other. The company provides a system and marketplace that allows workers to coordinate their activities. Every worker has suppliers and customers – and personal relationships – to consider as they go about their work.

Every employee writes a personal mission statement that describes how they will contribute to the company’s goal, and is also responsible for the training, resources and cooperation they need to achieve it. Every employee also creates a yearly Colleague Letter of Understanding (CLOU), describing their promises and expectations for the coming year, negotiated in face-to-face meetings with peers. All the agreements, taken together, represent about 3,000 peer-to-peer relationships that describe the activities of the entire organization.

There’s no competition for management jobs because there are no management jobs. To get ahead, workers must find better and more valuable ways to serve their peers.


Nordstrom [website] is a publicly traded high-end retailer, known for excellent service, with revenues of about $9 billion a year.

Nordstrom’s employee handbook is short and simple: “Use your best judgment in all situations. There will be no other rules.”

Nordstrom salespeople are free to make their own decisions. That customer-service culture is at the core of Nordstrom’s success. The entire system is organized in order to support that salesperson on the Nordstrom floor to help them deliver the best possible customer service.

Salespeople aren’t chained to a department like they are in other stores. If a salesperson wants to walk through the whole store to help her customer pick out clothes, shoes, cologne, and anything else, they can do that. A Nordstrom salesperson might stay in touch with customers by Twitter, email, or whatever else is convenient. The message to customers is: however you want to buy it, however you want to interact with us, we can do it that way.

Customers are encouraged to take things home and try them, and bring them back at any time.

>>> How can business development help grow an organization now?

  • Categorizing and prioritizing which opportunities provide the most potential with the least amount of effort

  • Diversifying efforts: improving product/service and brand recognition, designing custom experiences for potential clients…

  • Knowing your real audience, and pitching only to it

  • Looking for connections, but not just between people: between companies

  • Looking out for industry trends: research, know your options and network towards expanding them. New trends equal new opportunities.

A parting gift: David Noël, Head of Internal Communications at SoundCloud, reflecting on six years andfive lessons learned.