Business Development &

Renewal Process

Dr. Elijah EzenduFIMC, FCCM, FIIAN, FBDI, FAAFM, FSSM, MIMIS, MIAP, MITD, ACIArb, ACIPM,

PhD, DocM, MBA, CWM, CBDA, CMA, MPM, PME, CSOL, CCIP, CMC, CMgr

ObjectivesAt the end of this course, participants would

be able to do the following:• Explain business life cycle• Distinguish between business growth and

business development• Explain the concepts of business

development• Identify the process for implementing

business renewal• Coordinate execution of business

renewal within a firm

“In growing, highly competitive businesses, the life cycle's predictable patterns help CEO's and their managers develop insight as to what problems need to be corrected first.”

- Jack Veale, The Business Life Cycle

What is Business Life Cycle?

A business life cycle depicts the stages of advancement which a business goes through in the course of activities.

Executives and managers must be able to identify the actual position of a firm and the next destination in its business life cycle, in order to establish appropriate business plan for driving the business portfolio in accordance with strategic intent.

Contemporary Model of Business Life Cycle

Formation

Growth

Maturity

Decline

Stage I Stage II Stage III Stage IV

Seven-Stage Model of Business Life Cycle

Seed

Start-Up

Growth

Established

Expansion

Mature

Decline

Innovate

The First Stage (Seed)

This is the conception of business as an idea or clicking thought

Highlights: Resolution on ownership structure and business advisors

Challenges: Finance and Market

HR Focus: Availability of Appropriate Talent

The Second Stage (Start-Up)At this juncture, the business commences

operation as a legal entity and attempts to move its products or services to consumers.

Highlights: product development, customer base, competitiveness, cash flow management and market presence

Challenges: Strategy, Competitive Intelligence, HR and Financial Planning

HR Focus: Human Resource Composition, Organisational Systems and Reward Management

The Third Stage (Growth)This involves great increase in customer

base and revenue.

Highlights: Modulated Financial and Management Systems, Increased Administrative Protocols, and growth in staff strength

Challenges: Delegation, Managerial efficiency and effectiveness

HR Focus: Talent Management, Career Path Analysis, Cultural Alignment, and Performance Management

The Fourth Stage (Established) At this stage, the business goes through a

momentary slow-down in growth rate and upholds its market share.

Highlights: Cost Management, Productivity Enhancement, Outsourcing, Alliance Development and Management, Business Process Reengineering plus Increased Automation

Challenges: Organisational Agility, Strategic Roadmap Management

HR Focus: Motivation, Performance Reengineering, and Retention

The Fifth Stage (Expansion)This parades exploration and exploitation of

markets for evolving the business.

Highlights: Aggressive Marketing, Highly Structured Value Engineering, Channel Development and Management, Alliance Development and Management, and Technology-Driven Competitive Advantage

Challenges: Diversification Strategies, Investment Management and Strategic Alignment

HR Focus: Human Resource Development, Workload Analysis and Management, and Organisational Development

The Sixth Stage (Mature)

This is characterized by great drop in sales growth and occurrence of negative cash flow.

Highlights: Cost Management, Financial Management and Market

Challenges: Organisational Leadership

HR Focus: Leadership Development and Reward Management

The Seventh Stage (Decline/Innovate)

At this point, the business tends to stray into moribundity and its leaders may decide to innovate for growth and expansion or allow it to continue declining and finally harvest the assets.

Highlights: Financial Management, Due Diligence, Competitive Intelligence, Strategy and Corporate Restructuring

Challenges: Ownership Resolution, Strategic Alignment, Opportunities Profiling and Decision Dynamics

HR Focus: Organisational Restructuring, Human Resource Planning and Retention

Business Growth

Business growth involves the increase in top line through increased sales or enhancement of bottomline by decreasing cost.

Why the Focus on Business Growth

Capacity Utilization Increase in Profit Increase in Market ShareSurvival Visionary DrivePrestigeExploitation of Opportunities InfluenceKnack for Accomplishment

The Focus of Business Growth

Business Growth focuses on each stage of the a business life cycle.

Business growth strategies are usually short term and structured to suit the events and conditions at the particular position where a firm is located in its business life cycle.

Business Development is a process, programme, technique and system for mapping, optimizing and controlling the value flowage of an organization from strategic intent to worth consumption.

Levels of Business Development

Product Level of Business Development

1. Incremental Development: This focuses on growing the functionality and relevance of current bundles of value proposition. For example, moving an item to a level of additional functionality by adding more features.

2. Disruptive Development: This is geared for evolving novel innovation to embody fresh bundle of value proposition. For example, bringing forth a totally new product.

Commercial Level of Business Development

1. Market Development: This involves increasing the entire market of a firm by charting value proposition to new prospects.

2. Channel Development: This focuses on aligning, structuring and evolving a firm’s channel in compliance to the strategic-fit.

3. Value Chain Development: This deals with systematic modification and enrichment of a firm’s value chain for competitiveness.

Corporate Level of Business Development

The corporate level of business development boosts up competitive positioning of a firm’s total value proposition through restructuring, realignment and change.

The Focus of Business Development

Business Development focuses on structuring appropriate strategic map for a firm’s business portfolio, so as to ensure continuity, viability and accomplishment of strategic intent.

Business Development is usually geared for long term survival.

Case Study

In 2003, the management of Philips observed drawbacks in its business activities. On reviewing the firms position, issues identified included decentralized business planning, logistics and accounting; 7 Business Units; 21 Creation Teams; Each Team had individual R&D approach; Distinct regional marketing programmes; Undifferentiated business models; USA operations focused on improving retail position; In-house infrastructure; Large own consumer service organisation.

It decided to implement business renewal strategies and the targets achieved in 2005 included centralized business planning, logistics and accounting; 3 Business Units; 12 Creation Teams; aligned R&D roadmaps; coherent global marketing approaches; business model adapted to life-cycle; USA operations implemented lean organisation and global programmes to drive business; outsourced, shared service centres; outsourced consumer service organisation. As a result, the firm achieved reduction of 400 million Euro operating cost by second quarter of 2005.

Business Renewal

“Business Renewal encompasses a number of overlapping traditional and modern process areas. In your organization these might include: strategy formulation, innovation, business development, eBusiness strategies, strategic marketing, competitor intelligence, and business network development & management.”

- Manyworlds

1. Product Innovation

2. Disruptive Innovation

3. Application Innovation

4. Line Extension Innovation

5. Marketing Innovation

6. Process Innovation

7. Platform Innovation

8. Integration Innovation

9. Business Model Innovation

10.Value Chain Innovation

11.Structural Innovation

12.Experiential Innovation

Innovation Paths at the Heart of Renewal Processes

Ted Zoller’s Leveraging Approach for Business Renewal

1. The ventures advantage

2. Its place in the market landscape

3. How customers perceive the firm and product

4. Firm’s ability to execute

Adapted from Radical Innovation Group

Competency for Renewal Process

Dr Elijah Ezendu is Award-Winning Business Expert & Certified Management Consultant with expertise in HR, OD, Competitive Intelligence, Strategy, Restructuring, Business Development, Sales & Marketing, Interim Management, CSR, Leadership, Project & Programme Management, Cost Management, Outsourcing, Franchising, Intellectual Capital, eBusiness, Social Media, Software Architecture, Cloud Computing, eLearning & International Business. He holds proprietary rights of various systems. He is currently CEO, Rubiini (UAE) and Hon. President, Worldwide Independent Inventors Association. He functioned as Chair, International Board of GCC Business Council (UAE); Senior Partner, Shevach Consulting, Nigeria; Chairman (Certification & Training), Lead Assessor & Council Member, Institute of Management Consultants, Nigeria; Lead Resource, Centre for Competitive Intelligence Development; Lead Consultant, JK Michaels; Technical Director, Gestalt; Chief Operating Officer, Rohan Group; Director, Fortuna, Gambia; Director, The Greens; Director of Programmes & Council Member, Institute of Business Development, Nigeria; Member of TDD Committee, International Association of Software Architects, USA; Member of Strategic Planning and Implementation Committee, Chartered Institute of Personnel Management of Nigeria; Adjunct Faculty, Regent Business School, South Africa; Adjunct Faculty, Ladoke Akintola University of Technology, Nigeria; Editor-in-Chief, Cost Management Journal; Council Member, Institute of Internal Auditors of Nigeria. He holds Doctoral Degree in Management, Master of Business Administration and Fellowship of Several Professional Institutes in North America, UK & Nigeria. He is an author & widely featured speaker in workshops, conferences & retreats. He was involved in developing Specialist Master’s Degree Course Content for Ladoke Akintola University of Technology (Nig) and Jones International University (USA). He also works as Adjunct & Visiting Professor of Universities and holds Interim Management Assignments on Boards of Companies.

Thank You