In the past, it was difficult to convince many senior managers of the importance of artificial intelligence. Now, following the emergence of ChatGPT, the whole subject has been foregrounded so effectively by the media – and then further amplified by dozens of non-specialists with no real technical understanding at all – that the result could almost be described as an overreaction. Most people still find it difficult to evaluate the impact of developments in artificial intelligence. Uncertainties surrounding interest-rate trends, the opportunities and risks of price movements, ESG and geopolitical tensions further aggravate the situation. All these trends are much more difficult to assess and compare today than they were a few years ago.
In such circumstances, it is more important than ever to keep one’s bearings, develop multiple scenarios, and focus firmly on ensuring that one’s own plans (strategic plans included) are robust. Even without such volatile trends to contend with, business development is often challenged by the temptation to confuse wishful thinking for a well-grounded plan. In the past, circumstances were more forgiving. But as things stand, a superficial business development plan will soon lead to ruin.
Developments in AI started to pick up speed again some 10 years ago. The fundamental concepts had already been developed several decades earlier, but the resources (such as high-performance hardware) required to turn these concepts into useful applications did not yet exist. Today, more developers are working in this specialist field than in any other area of development, which is why we are seeing such rapid progress from one year to the next. However, as far as companies are concerned, the euphoric reactions of those who have spent a few minutes “playing” with ChatGPT are meaningless. Superficial observations are not a viable basis for new business models – as frequently noted by those who have developed new (or further developed existing) business models by engaging intensively with the underlying issues. Essentially, there is no alternative to a well-founded, well-grounded vision of the future as one of the key prerequisites for developing a future-proof business. Such a vision should include clear ideas on technological developments, the evolution of customer needs and behaviours, wage and salary trends, and changes in macroeconomic parameters. While there is no need to delve deeply into every single one of these areas, simply skimming the surface will not do justice to the important task of corporate and business development.
Attitudes to key questions – which activities should be regarded as essential, which optional; how responsibility should be distributed within the company; what the business development process should look like – are shifting. In truth, traditional strategic and planning processes have long since had their day, but continuing to use them was not really much of an issue – until now. Because business development must also become agile. A process which is simply repeated unaltered, year after year, is not fit for purpose. Instead, the process of business development should focus on objectives in the context of the surrounding environment. In principle, of course, this is nothing new: “Your Strategy Needs a Strategy” is just one of the books promoting this idea. But again, it is nothing more than an idea, making no more sense on its own than simply carrying on as before. Managers responding to surveys asking how much time they spend on corporate and business development almost unanimously return the same answer: “not enough”. And what do we learn from this? “Nothing good happens unless you make it happen” – in short, that Erich Kästner was right. Nowadays, we call this discipline “new business development” to show first, that the process of business development has changed (emphasis on “new”), but second, that business itself is also changing (emphasis on “new business”). Instead of always using the same formulas and somehow expecting the outcomes to change, we need to ask – much more frequently than we do – what we should be doing “differently”:
One could go on forever; the list of questions is endless. But all of them are based on the same premise: that businesses are only justified in following the traditional, stick-to-the-knitting approach – or indeed the blue-sky, let’s-do-things-differently approach – if there are very good reasons for doing so. This short post is not intended as an encouragement either to blindly hype the new (such as ChatGPT) or to blindly carry on as before. It is intended to inspire a business development rethink.