Original Date: 04/20/1998
Revision Date: 01/18/2007
Best Practice : Business Development Process
ITT Aerospace/Communications Division’s (A/CD’s) Business Development Process is a very effective, integrated proposal process that was started about five years ago. As the initial phase of the Integrated Product Development (IPD) process, the Business Development Process shifts much of the focus and resource expenditure to the front end of a project. Prior to the early 1990s, no formal business development process existed. The company relied on basic business development practices, and effectively raised its win rate from 30%-40% to 70%-80%. However, ITT A/CD realized that it was writing good proposals and winning contracts without any comprehensive plans for implementing or successfully completing them. These basic practices were also only being applied to large programs. ITT A/CD wanted to standardize and integrate a business development process into its corporate policies and other IPD initiatives. In January 1997, the Business Development Process was formally integrated with the company’s IPD process, simplified, and more strongly enforced. These changes enabled ITT A/CD to improve the entire IPD process.
By integrating the Business Development Process with the IPD process (Figure 2-4), ITT Aerospace/ Communications Division fully involves its Business, Engineering, Operations, Finance, and Contracts departments up front at the bid and proposal stages. The company then simplified its Business Development Process to focus on key standardized management tools (e.g., Integrated Management Plan (IMP), Capture Plan, Proposal Plan) that are available electronically. Charts, checklists, and templates are also maintained for each tool in a Capture Team/Proposal Team Notebook. Business area directors and product line steering teams are now included in the review cycle, and the price/cost review was moved forward to Milestone 2A (on the flowchart) to allow more time to work these issues. Support for the tools and procedures is a key factor to successfully implement this process. ITT A/CD relies on its trained process coaches and product experts. The process can also be tailored and applied to every product development project.
By using the management tools, the business development team integrates each member’s input to facilitate communication and decision making. The tools also help the team identify whether a project is winnable, within the capabilities of the company, worthwhile to pursue, as well as what to do once a contract is awarded. Many front-end concept development and architecture tasks are completed prior to the start of the project. This shifts much of the cost to the front end of the project. ITT A/CD now expends one-fifth to one-third of the total project budget at the bid and proposal stages. The company discovered that this is money well spent due to the high win rate of nearly 80%. The up-front emphasis ensures that all the ground work and planning are completed, so work on the project can begin immediately upon contract award.
ITT A/CD’s Business Development Process provides an earlier and more effective allocation of program resources which results in a more solid program plan, smoother program start-up, earlier cost versus price strategy, and earlier completion of necessary forms and approvals. In addition, the program plan, design, win strategy, cost rough order of magnitude, and team are established very early on, allowing adequate time to execute an orderly proposal approach and to work cost issues. As a result, the company can immediately begin work upon contract award, rather than spend time planning its approach.
Figure 2-4. Key Business and IPD Milestones
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