Do you understand the direct connections between what you do each day as a professional in your field and how it impacts your company’s success? Can you give a company tour and explain the core role of each function or department? Do you know how your company makes money and delivers shareholder value? Can you read and understand your company’s financial statements?
These basic questions define your knowledge of general business. When you continually cultivate your knowledge and understanding of how businesses and organizations run at every level, you improve your ability to make good judgments and quick decisions each day as well as position yourself for career success.
What is Business Acumen?
Business acumen is the understanding of how a business operates, how a company makes money, and your role in that process. “Acumen” is the ability to make good judgments and quick decisions. It is an awareness of the drivers that move your company forward and what you can do to impact the bottom line. In order to advance in your career and climb the corporate ladder, you must be fully engaged and contribute to your company’s success; you must understand how cash is generated for your company, what makes your company profitable, what creates growth for your company, and why your customers buy from you instead of your competitors.
Why is strong business acumen critical for career success? As you think about advancing your career and growing to the next level, it is important that you understand the core business applications of sales and marketing principles, accounting practices, innovation, and operational functions within your respective companies. Every action you take and each decision you make impacts another area in some way. You must understand how. If you do not understand, you must ask questions and do additional research. Developing your business acumen will also give you the knowledge you need to be able to participate in discussions of a financial or business nature with your executive leadership and other team members.