Course

Management Development Institute, Gurgaon

PGP, Dec 2010 – Feb 2011

Business Development in IT

Prof Sangeeta S Bhardwaj

Prof. Dhruva Nath

Management Development Institute

Gurgaon 122 001

1. Background :

The process of Business Development involves the following broad steps :

a) Identifying a potential client, or prospect

b) Identifying the client’s needs, or even creating needs

c) Proposing a possible solution in response to these needs

d) Resolving any issues that may come up

e) Closing the deal and obtaining the order

Identifying or developing needs is a critical issue in the area of Business Development, and it starts early on – at the prospecting stage. In many cases, it would also include helping the client to identify or at least clear up his own thinking.

In the field of Information Systems, identifying needs is a complex process for several reasons. First of all, needs are often not known, or at least not known clearly. Often the identified need has no significant link with the Business Goals or Strategies of the company. Secondly, there is no standard off-the-shelf product that can satisfy the need. Even if an off-the-shelf product were to be used, it would have to be part of a customized solution. And finally, the need as perceived by the IT Department of a company, is often limited in scope, since the IT Department is usually not involved in Strategic Decision making. Consequently, many software firms employ the Consulting approach to identifying and crystallizing needs.

In the “Propose Solution” phase, most organizations use the RFP or Request for Proposal Route, based on which the service provider makes his presentation and proposal. Critical issues here include the stage at which the service provider needs to get involved, whether to take the product route or the service route, and the appropriate pricing models.

In the “Close” phase, contracts and IPR become major issues, which therefore form the...