Within a company, the staff that do business development and the operational business units that serve your customers often don’t get along. It’s not surprising, given that they’ve been set up to fail and organized to be in direct opposition to each other.
It’s strange because they should have so much in common. If business development and proposal success require relationship marketing, then you would expect both to want to work together to grow the customer relationship. Business development can help the operational business units to grow their staff, resources, and scope of work. But the other factors in their environment usually far outweigh these considerations.
Whenever they work together it usually means that the staff from the operational business units have been given work on top of their normal project workload. From the very beginning, business development is positioned as a distraction or burden. The business unit staff are sometimes uncooperative and disinterested, and business development can see them as an obstacle. And the operational business units see business development as uninformed and incompetent, making them a risk at best, a threat at worst.
And the reward when the operational business units cooperate with business development is often to participate in a proposal — piled on top of their normal workload. Once the proposal starts, the conflicts can’t be ignored. They are set in writing for all to see. But the process of getting it in writing is stressful and painful, making it more emotionally difficult to deal with the conflicts. And often because the conflicts aren’t anticipated and resolved before the writing starts, resolving the conflict means rewriting, adding insult to injury on top of the now even more expanded workload.
Business development is about reaching beyond your comfort zone. Operational business units seek stability and risk mitigation. Business development always wants more. But the business units must manage their workload so that they don’t get put into a position where there is more to do than they have people to accomplish it.
Business development also forces the operational business units to confront their failures. Poor performance lowers the chances of winning. Overcoming poor performance must be part of the bid strategies. Nobody in an operational business unit wants to admit that poor performance occurred under their watch. You can use word games to call it something else (issues, incidents, whatever), but you can’t change the fact that it puts people on the spot.
The biggest issues usually revolve around what to include in the offering and how to price it. Every bid has a price to win and a price to perform. The natural incentives are for business development to bid low and for the operational business units to bid high enough to cover every contingency that could impact performance. The right price depends on which risk and how much of it the company wants to take on. For this reason, neither business development nor the operational business units should control the final price.
When a company holds a contract for a long time, rewarding their best operational staff can become a problem during a recompete. The competitors will bid staff who are qualified, but cost less because they haven’t received as many raises. They are like your staff was at the beginning of the contract. An environment like this magnifies the conflict between the operational business unit staff and business development.
An institutionalized process of arbitration and transparent decision making can help mitigate the conflict. In most organizations this means someone sitting above both of them on the org chart with profit and loss responsibility making key decisions. But it should be based more on process than on authority. Risk decisions should be made explicitly, based on criteria you can articulate, the strategic plan for the company, and the circumstances of the bid. When you do this, you make the bid discussions about how decisions get made and not about what decisions got made or who made them. In addition to less confrontation among participants, you get better decision making as a result.
Often companies try to fix the conflicts through incentives. Since BD is usually incentivized to win and operational business units are incentivized based on customer satisfaction, the incentives often get in the way of good relations between the two. Mixing the incentives, for example giving the business units some incentives based on wins, can help, but will still produce side effects. Incentives always have side effects.
Intrinsic rewards often work better than financial ones. What fuels the conflict is basically insecurity. If you can’t give people direct control over their own destiny, then what does help is clear lines of authority and transparent decision making. Seek out what it will take to perform and what it will take to win, without ignoring either. Then make a decision based on which risks are in the company’s interests and explain it that way. Make sure that the staff stuck with the decision are managed based on how they handle the risk and not just on customer satisfaction.
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Carl is the Founder and President of CapturePlanning.com and PropLIBRARY.
The materials he has published have helped millions of people develop business and write better proposals. Carl is an expert at winning in writing. He is a prolific author, frequent speaker, trainer, and consultant.
Carl can be reached at email@example.com
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