'Risk comes from not knowing what you're doing'. – Warren Buffett (Chairman, CEO and largest shareholder at Berkshire Hathaway)
5 Essential Truths
- Business development/winning business is a strategic focus of the business supported by the C-suite.
- Bad deals and control implementation will result in lower than expected profits –this is because of under pricing, unfavourable customer contracting, refunds, rebates, scope overrun, customer dissatisfaction, inability to recover and deteriorating customer relationships.
- The sales department is intrinsically aware of the activities of the operations department.
- A good winning business strategy and function has risk management embedded as a foundational pillar.
- Companies that put a premium on risk intelligent dealmaking are seeing better growth and increased profit margins.
5 Immediate Check Points
- Are you creating a business development/winning business function? Have you assessed the effectiveness of the current business development/winning business function?
- Do you embed risk appetite and risk tolerance, not just at the enterprise level but also at the operational level?
- Have you challenged the relevance of the practices of the function in terms of the changing needs of customers?
- Are you on top of relevant information from “opportunity to profitability”, and can you paint a picture to determine the “current state”?
- Are you managing your contract risk compliance to protect margin erosion from commercial negotiation to contract implementation and monitoring?