This blog is an unsolicited addendum to a blog post that Seth Godin published yesterday on Understanding Business Development (original post on Seth’s blog here). I respect Seth quite a bit, I just don’t typically read his posts since I find that we tend to have a lot of the same ideas (sometimes at nearly the same times- check out his blog from today here on customers and compare it to my video response to Thad, searchable by the name Thad at http://carolroth.com/spiyt/ and you will see that we are clearly on the same wavelength!).
I have given up posting several blog topics because Seth posted generally the same thing before I had sorted out all of my thoughts on paper. However, when I saw the business development topic in my inbox yesterday, I had to look. Given that I have done dozens of “business development” type deals over the past 14+ years, ranging from mergers and acquisitions to joint ventures to licensing deals, I was tempted by the headline and had to read the post.
Surprisingly, I was in agreement with virtually all that Seth said. I did find one key element missing and I thought I would expand upon it here. That is focus, then be flexible.
While in an ideal world we would all engage in great collective brainstorming meetings where we start with objectives and use creativity to backtrack into a win-win partnership (and get warm chocolate chip cookies and milk as snacks), that usually doesn’t happen in the real world. Most companies (and by companies, I mean the people who hold business development and C-level decision making titles in companies) don’t do well with unlimited options and ambiguity. They need concrete ideas, examples and levers.
The deals I have seen go nowhere all have this in common: they were approached with too much flexibility. One side saying, “We can do anything you want” is usually met with blank stares. If you have a partnership to propose, put some specifics and structure around it. You can present a handful of options (one, two or three- not 18) to get across the breadth of your capabilities, but start out with something specific. Then find out where the barriers are and demonstrate your flexibility in revising and tweaking the deal to meet each party’s needs. Most people will do better (and you will have more success) if you give them specifics to comment on rather than general ideas.
For example, one client of mine that had a very large enthusiast base was approached by another company that made collectible products and wanted to do a partnership. We asked what they had in mind. They said they could do anything- they could produce any number of potential products and it could be sold anywhere by either party through a number of channels. My client was completely overwhelmed and with so many options, nothing happened. If the company had presented mock-ups of a few potential product ideas and said that they could have licensed my client’s name and sold them through retail stores OR that they could sell them to my client at wholesale which in turn my client could sell directly to its customers, the outcome would likely have been very different. Even if neither deal was exactly what my client desired, at least it would have been a starting point to move the discussions forward and tweak the deal so that it made sense for both parties. The endless options and lack of a focused discussion starting point was just too darn flexible.
Bottom line- flexibility is great, but also can kill a deal. Be flexible only after you are focused, or else you may never get past an introductory meeting.