The psychology of business development

For Gene Kakalec, vice president of business development and marketing at Northrop Grumman Information Technology, business development is a matter of getting inside the heads of government customers.

"One of the things that becomes increasingly important going forward in the market is making sure you understand the mission of that organization," Kakalec said. "Whether it's the Department of Agriculture or Transportation Security Administration or anywhere in the Department of Homeland Security, you had better understand the mission issues."

Kakalec leads business development for the company's government solutions unit, working with civilian agencies and DHS. He said he believes industry's understanding of customer needs has increased during the past few years.

And not a moment too soon. Federal agencies are no longer handing sets of technical specifications. The rise of functional specifications and performance-based contracting means integrators have to understand an agency's business issues to field a solution.

Specifically, integrators must consider customers' budgets, missions and directions and then map their skill sets to the task at hand, Kakalec said. The need to understand the customer's business requires more than a change in selling philosophy. Companies have to invest in personnel, he said. His company, for example, hired additional senior-level business development experts to cultivate more potential customers.

The civilian agency side of Northrop Grumman IT has separated business development activities into two pieces. First, the company has business development account managers, who are charged with understanding a given agency's mission and establishing an account plan. Second, the company employs a group of task order salespeople who support task orders for a particular customer base. Kakalec said the split between account managers and salespeople is nearly even in the civilian sector.

In addition to market-specific business development activities, the company also operates a centralized organization that pulls in resources companywide to pursue IT projects.

A seven-year, long-range plan and a detailed annual operating plan guide the company's business development work. But so, too, does a recognition of the government's drive for a positive return on investment.

"It comes back to more of a commercial mind-set of, 'What is our ROI?'" Kakalec said. Customers, he added, "are looking at every dollar they spend."