Last time we talked about having enough opportunities in your pipeline so that even after you have a flood of solicitation releases and you forego some opportunities because you are short-staffed, you have enough to bid on during the months when it’s barely a trickle.
Now let’s talk about what is enough. Knowing your “enough” is as important in business development as it is in life. Knowing what’s enough keeps us from overeating, overdrinking, overspending, overextending ourselves, and so on.
You can easily go overboard and fill your pipeline with too many opportunities that you don’t have enough money or time to capture. Usually, though, the problem with business development is just the opposite. You don’t have enough to bid on. In that instance, we talk about what “just right” looks like for your company.
You could apply a formula to determine how many opportunities you need based on how much new business you want to bring in by the end of the calendar year. It is called “bookings” in the business development vernacular. Let’s say, you are looking to book $20 million in new business.
Do you know your win_rate?
If you do, the formula is simple: you need to divide your desired bookings number by your win_rate. If your win_rate is 33%, then you need to have $60 million in opportunities in your pipeline ($20 million/0.33 = approximately $60 million). If your win_rate is 20%, then you will need $100 million in your pipeline.
If you don’t know your win_rate, you may want to be conservative and assume it’s on a lower side.
Through some planning, you will have to determine what your total pipeline dollar value means as applied to the specific opportunities slated to come out in your area of expertise. Are these a few large opportunities or multiple small ones? Are those going to be prime or sub opportunities? Are these currently spaced out enough for you to have the right number to bid on every month without drowning in proposals? Do you have enough opportunities in your pipeline that are slightly lower in priority but could become more attractive during the drought?
You may also want to balance your planning against your available resources. Are your growth ambitions in line with your capture and proposal budget? Is your current business development team capable of handling that many proposals?
You may have to adjust course. Either decide a lower bookings number is enough. Or grow more ambitious and go after fewer but larger opportunities. Or decide that you will end up subcontracting more than priming, and your prime would handle the bulk of the proposal work.
Knowing exactly where your desired growth is going to come from gives you more control over your company’s future. Your pipeline is truly the engine of business growth, and it requires care and attention.
To help you further with your pipeline development efforts, contact us to see if our Winning Edge opportunity identification and qualification services are right for you: email@example.com or 301-384-3350.