The ‘In’Difference Between Business Development and Sales

I looked at the candidate sitting in front of me, and then at his CV that he brought along, ‘5+ years of Sales and Business Development experience’. This statement at the top of the CV made me ask my next question:

“What is the difference between Sales and Business Development?”

In the past few years, Business Development is a term that has gained significance, reputation and an extraordinary position in organizations. Every now and then, this word makes all efforts to be ‘different’ from its competition: Sales and Marketing.

On a fundamental level, Business Development is all about growing your business.

If that is true, then aren’t Sales people working to ‘grow’ an organization’s business?

Partly true. Bigger, larger organizations have a different understanding of this term ‘Business Development’. It revolves around creating a vision, and ‘strategy’ for the company to reach the vision.

Wait? What? More buzz words? More confusion.

No. Larger organizations have clear and defined roles of Business Development, Sales and Marketing.

Ok, so, er… What Is Business Development?

Business development revolves around these three basic activities:

  1. Establishment of new markets.
  2. Generation of partnerships.
  3. Improvement of customer base.

Business Development serves as the umbrella department that defines the strategies and guidelines for ‘how to guide a business’ to fulfill the organization’s long term vision’. Business Development directs various departments as per their roles and responsibilities including Sales, Marketing, Project Management, Networking, Social Media, and legal to achieve the organization’s vision.

In short, Business Development determines how much business will be generated, from where, and how. Also, it defines the correct approach to achieve without failure.

So, what is Sales?

Sales are transactions.  It is the department/role that is responsible and accountable for selling a product, solution and service with identified price and clear customer identification to generate numbers. In sales, you’re convincing people to make a decision they have to make: a product to purchase, a service to have, or a solution to implement.

Ok, if it’s that simple why the confusion?

In 2001, I joined a startup as ‘Business Development Manager’. After the initial exposure to ‘finding new markets, aligning products and creating partner alliances’ I was asked to ‘sell’ the solutions in identified markets. This happened because in startups and smaller organizations, one person has to handle several roles. For such firms, these two (three; including Marketing as well), are the same. Smaller firms intertwine these roles because their motto and strategy is simple: to SELL. For such firms, in most cases, a final decision on business development is often left to the founder, CEO. A newly hired ‘Business Development Manager/Executive’ would do the exact same thing as a “Sales Manager” would do in such firms. In most cases, the job title is often referred to as “Business Development and Sales Manager”.

So in larger firms, these roles don’t overlap?

Sometimes, they do e.g. a marketing executive will continue to connect with a customer even after a lead or opportunity is identified. This is because in some cases a lead continues to be a lead for quite some time. To have the customer engrossed in the product, service or the company itself, customer relationships are to be revised every now and then. The same goes for Business Development. Business Development also includes personal emails, follow up calls, meetings, lunches, and campaigns.

The real differentiator is Scalability. Sales is about competence; how to convince a customer to go for your product over your competition.

A ‘pure’ Business Development job will have all these skills sets:

  • Identifying and strategically assessing an opportunity to create long-term value.
  • Supporting Sales and Execution of the same to create value addition.

This is not to de-value the function of Sales. Sales is tough, as you have to deal with constant denial and pressure to generate results.

Despite their apparent overlap, the two are different.

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One Comment;

  1. Feras said:

    BDM has a ‘hunter’ focus, to bring in new customers and sell additional products and services to existing customers