Opportunity Assessment
A pivotal decision point during the opportunity assessment phase of the business development lifecycle involves making a preliminary bid/no-bid determination for a specific opportunity.
Various channels, such as marketing campaigns, traditional prospecting, social media efforts, and lobbying strategies, enable organisations to pinpoint potential sales opportunities. Typically, collaboration between the marketing team and the sales or opportunity team is essential for identifying and qualifying these potential opportunities.
Decisions made earlier in the business development lifecycle significantly impact this phase, where strategic planning and market positioning/segmentation guide how organisations spot opportunities and integrate them into the sales pipeline.
Many successful organisations utilize third-party sales opportunity tracking programs (subscriptions) to monitor and trace future bidding opportunities, especially in regional and national markets. These programs aid in identifying upcoming opportunities by applying specific filters during opportunity searches.
Effective qualification of opportunities is crucial for enhancing overall win rates. Companies that fail to adequately qualify opportunities often exceed their marketing and sales budgets, pursuing numerous opportunities with a low probability of success. Consequently, resources are diverted from more achievable deals and the delivery of projects that could lead to renewals.
Key questions at this stage include:
Is there an incumbent for this opportunity?
What is the incumbent’s performance?
Who are the known competitors?
Are there potential unknown competitors?
Can we win? Can we deliver profitably?
Is collaboration with another organisation necessary?
What is the cost of bidding?
Will bidding on this opportunity enhance our positioning for future opportunities?
Does this opportunity align with our strategic plan and vision?
Thorough competitive assessment and evaluation are also essential during this phase of the lifecycle, with a focus on understanding competitors' strengths and weaknesses in relation to the opportunity at hand.
Recent Developments
In recent times, organisations have witnessed several trends influencing their approach to gate decisions:
Accelerated Decision Timelines: The need for faster turnarounds has compelled proposal teams to make quicker and more efficient decisions.
Simpler Templates: Teams now rely on essential data when making decisions, using simpler templates that focus on key information.
More In-Depth Decisions: Rather than merely filling in boxes, teams are now strategically planning their wins as they navigate through decision gates.
Increased Focus on Price: Modern Requests for Proposals (RFPs) increasingly prioritize price as the differentiator. Failing to reach a competitive price may make bidding impractical.
Lower-Level Decision Making: Delegating decision-making down the hierarchy can result in faster and more effective choices.
Rise of Decision Tracking: Organisations are increasingly leveraging decision tracking to analyse bid-to-no-bid ratios and extract valuable insights.
Common Pitfalls and Misconceptions
To enhance overall gate-decision performance, it is crucial to avoid these common misconceptions:
1. All Opportunity Information Is Known Initially: Establish realistic information maturity expectations for each review stage.
2. Static Strategy Throughout Decisions: A dynamic win strategy should be reassessed at every decision gate, recognising the evolving nature of opportunities.
3. Winning Low Probability Deals Is Impossible Early On: Strategic actions can transform low-probability deals into high-probability successes with early engagement.
4. Late Start Equals Lower Probability of Win: Commencing late reduces the likelihood of success in high-probability deals.
5. Probability of Go Matters in Pursuit Decision: The decision to pursue or not should consider the revenue-generating potential, not solely the probability of winning.
6. Resourcing Is Critical in Probability-of-Win Calculations: Subpar teams often struggle to secure victories.
7. Gates Are Not Mere Reviews but Decisions: Postponing decisions at gates wastes time and resources.
8. Gate-Decision Quality Reflects Probability of Win: Effective strategy, not just the decision quality, is crucial for success.
9. Early Consideration of Price-to-Win: Competitive pricing strategies must align early with the presented solution.
Summary
Gate decisions play a pivotal role in steering through business development phases. Key considerations include involving relevant roles, limiting nonessential participants, engaging the right level of senior management, meticulous planning, specifying inputs and outputs for each decision gate, avoiding excessive focus on technical solutions, continuing decisions until firm conclusions are reached, being prepared to end pursuits, eliminating personal biases, recording decisions, updating opportunity/capture plans, archiving information, documenting lessons learned, and recognising the significance of gate decisions in preventing resource wastage on low-probability bids. Consistent decision criteria, particularly probability of win and probability of go, are essential for effective decision-making in the business development lifecycle.
