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It’s not enough today to simply have a business plan. To succeed in a highly competitive, crowded marketplace (and what marketplace isn’t crowded and competitive these days?) it’s critical to have a business development plan.

Historically, business development has been a subset of marketing and focused on acquiring new marketing or distribution relationships and channels. Today, business development has become interchangeable with many marketing and sales functions and is often confused with sales, especially in industries where “sales” has become a dirty word and “business development” sounds more refined.

The scope of business development can be wide ranging and vary significantly from organization to organization. A solid, well-thought-out, well-implemented business development plan can drive high levels of growth and profitability for a professional services firm. A poorly conceived and executed plan can frustrate key firm personnel and stifle growth.

So what exactly is a business development plan? It’s a document that outlines how you will implement your business development strategy. The difference between a business development strategy and a plan is that the strategy provides the concept behind developing new business. A business development plan contains the nuts and bolts for actually making it happen.

Creating an effective business development plan

In short, a modern business development plan implements your business development strategy. It integrates both marketing and sales functions into a holistic process that encompasses attracting, nurturing, and closing leads, turning prospects into clients.

There are five key steps to developing and documenting your business development plan:

  1. Define your target audience

You’re looking to attract your ideal client, so focus on individuals or firms that would be a best-fit. Don’t worry about creating a large audience – you want quality, not necessarily quantity. Still, you want to make sure your audience is large enough to yield enough clients to achieve your business goals.

  1. Do your research

Establish a clear understanding of your target audience: what are their issues, what services do they need, and how do they currently get them? Is your expertise relevant to potential clients and the problems they’re looking to solve?

  1. Determine your competitive advantage

Avoid being a “me-too” firm that looks and sounds like every other firm in your field. What makes you different? What do you – or can you – offer that will set you apart from your competitors? How can you position your firm to offer real value to prospects, something they can’t get elsewhere and are willing to pay top dollar for? Once you determine this, you’ll be able to craft sales messages and marketing tools that clearly define your firm and differentiate you from the competition.

  1. Choose your business development strategy

There are six basic types of strategies that can be employed based on your specific firm, its resources, and its goals:

Networking is probably the most universally used business development strategy for professional services firms. It can be expensive and time-consuming, but firms that do it well successfully develop new business.

Referrals are a close relative to networking and rely upon having very good relationships with existing clients and business partners. Similar to networking, referrals can work well but rely upon the judgement and accurate knowledge of your firm by the referring party.

Advertising and sponsorships are losing their grip on audiences. Studies have shown that traditional advertising is actually associated with slower growth. Only when advertising is combined with other techniques, such as speaking at an event, do these techniques bear fruit. Well-targeted online advertising holds more promise, but it’s not the only answer.

Telemarketing and direct mail have been used by professional services firms for decades. However, they are relatively expensive, so to be effective the call and mailing lists need to be up-to-date and accurate, with appropriate messages that catch prospects at the right time.

Thought leadership and content marketing creates visibility and encourages engagement by prospects through writing, speaking, and publishing content, especially online, that demonstrates your expertise and how it can be applied to solve client problems.

Combined strategies can boost significantly visibility and engagement across a number of channels, such as content marketing and networking, but there is a risk of under-implementing each strategy, reducing their effectiveness.

  1. Choose your business development tactics

There is a fuzzy divide between strategy and tactics – it helps to think of strategy as the what and tactics as the how. The Hinge Research Institute recently conducted a study that looked at over 1000 professional services firms and revealed the top ten most effective business development tactics used by high-growth firms. They are:

  • Networking at targeted conferences, trade shows and events
  • Providing assessments and/or consultations
  • Demos (in-person or digital)
  • Using a proposal toolkit
  • Speaking at targeted conferences or events
  • Video blogging
  • Creating downloadable, gated content
  • Nurturing prospects through phone calls
  • Publishing written blog posts on your website
  • Digital ads (pay-per-click, banner ads, etc.)

This list is a great place to start looking at the most effective tactics you can use for your firm. Make sure that each technique you select fits your target audience and strategy. Remember, it’s not about your personal preferences or familiarity with a tactic. It’s about what works with the audience.

Regardless of the business development plan you ultimately decide upon, the important thing is to do something. Develop a strategy, implement it, monitor its effectiveness, and revise as needed. Once you have honed a business development plan that works for your firm, you’ll be well on your way to improved revenues and profitability.