Business Acumen


Published on

Published in: Business, Economy & Finance
No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Business Acumen

  1. 1. How to Improve your Business Acumen & Entrepreneurial Thinking
  2. 2. Business Acumen Defined “ Understanding the organization’s business model and financial goals; utilizing economic, financial, and organizational data to build and document the business case for investing in workplace learning and performance solutions; using business terminology when communicating with others.” (Bemthal et al., 2004)
  3. 3. Components of Business Acumen <ul><li>Thorough insight into organization </li></ul><ul><li>Comprehensive understanding of the organization’s operations </li></ul><ul><li>Ability to apply and interpret financial data </li></ul><ul><li>Correct use of business terminology </li></ul><ul><li>Identify the priorities of the organization </li></ul><ul><li>Creating a value proposition </li></ul><ul><li>Advancing the learning and performance agenda of the organization </li></ul>
  4. 4. Gaining Insight into the Organization <ul><li>Increase knowledge of the organization’s business model, </li></ul><ul><li>strategic plan, and competitive position in the marketplace </li></ul><ul><li>Know how the business leverages core competencies for </li></ul><ul><li>growth and profitability </li></ul><ul><li>Know what the value statement is to external customers </li></ul>
  5. 5. Understanding Business Operations <ul><li>Develop knowledge of the organization’s structure, systems, </li></ul><ul><li>functions, and business processes </li></ul><ul><li>Be familiar with planning processes and decision-making </li></ul><ul><li>channels </li></ul><ul><li>Know the information management systems </li></ul><ul><li>Understand how products and services are developed, sold, </li></ul><ul><li>and delivered to customers </li></ul>
  6. 6. Applying and Interpreting Financial Data <ul><li>Know the financial goals of the organization </li></ul><ul><li>Understand financial data and how it relates to business </li></ul><ul><li>success measures </li></ul><ul><li>Ability to interpret balance sheets, graphs, charts, tables, etc. </li></ul><ul><li>Ability to perform quantitative calculations in building a </li></ul><ul><li>business case, preparing budgets, evaluating the impact of a </li></ul><ul><li>program, and determining return-on-investment (ROI). </li></ul>
  7. 7. Use of Business Terminology <ul><li>Ability to translate business jargon into business terminology that </li></ul><ul><li>stakeholders and customers will understand and respect </li></ul><ul><li>Know and speak the language of the organization </li></ul>
  8. 8. Identifying Organizational Priorities <ul><li>Thorough knowledge of the needs and expectations of </li></ul><ul><li>customers </li></ul><ul><li>Ability to track changes in the needs and expectations of </li></ul><ul><li>customers </li></ul><ul><li>Determining links between internal demands and external </li></ul><ul><li>needs </li></ul><ul><li>Understand the business priorities of internal clients and how </li></ul><ul><li>the organization can assist them with achieving greater </li></ul><ul><li>success </li></ul>
  9. 9. Create a Value Proposition <ul><li>Determine link between business needs and particular solutions </li></ul><ul><li>Document how particular solutions achieve results </li></ul><ul><li>Identify outcomes that result from implemented solutions </li></ul><ul><li>Ability to create a compelling business case </li></ul>
  10. 10. Advancing the Learning and Performance Agenda <ul><li>Insight into how decisions are made within the organizational </li></ul><ul><li>structure </li></ul><ul><li>Know how power is exercised </li></ul><ul><li>Ability to use one’s understanding of organizational politics </li></ul><ul><li>across business units and key decision-makers </li></ul><ul><li>Identify key stakeholders and their priorities </li></ul><ul><li>Ability to present and successfully defend learning and </li></ul><ul><li>performance solutions </li></ul>
  11. 11. Common Mistakes in Developing Business Acumen <ul><li>Lack of understanding of basic business terminology </li></ul><ul><li>Overuse of buzzwords </li></ul><ul><li>Incorrect use of return-on-investment (ROI) speak </li></ul><ul><li>Failure to understand what key stakeholders’ definitions of ROI </li></ul><ul><li>are </li></ul><ul><li>Unconditional love or inflexible use of one specific approach, </li></ul><ul><li>method, idea, or product. </li></ul>
  12. 12. How to Increase Business Acumen <ul><li>Increase understanding of financial terminology and organizational </li></ul><ul><li>performance metrics </li></ul><ul><li>Work at the pace of the organization </li></ul><ul><li>Understand the financial picture of the organization </li></ul><ul><li>Volunteer </li></ul>
  13. 13. Understanding Financial Terminology and Performance Metrics <ul><li>Enroll in a finance course </li></ul><ul><li>Practice reviewing and interpreting financial data such as departmental </li></ul><ul><li>financial statements, balance sheets, etc. </li></ul><ul><li>Develop and monitor a personal budget and ask internal experts for feedback </li></ul><ul><li>Observe the strategies of colleagues who make successful financial </li></ul><ul><li>decisions </li></ul><ul><li>Partner with a financial manager to gain insight </li></ul><ul><li>Ask a financially savvy colleague for tips and feedback </li></ul><ul><li>Volunteer for cross-training opportunities </li></ul>
  14. 14. Working at the Organization’s Pace <ul><li>Work with clients collaboratively to identify and communicate </li></ul><ul><li>progress of a particular plan </li></ul><ul><li>Earn the right to be included in financial business-planning </li></ul><ul><li>processes </li></ul><ul><li>Administer an ROI analysis for an idea you want to implement </li></ul><ul><li>Present the analysis to senior leaders. </li></ul>
  15. 15. Understanding the Financial Picture <ul><li>Understand the organization’s financial goals, profit margins, and </li></ul><ul><li>how they measure against the competition </li></ul><ul><li>Read industry specific publications to track trends </li></ul><ul><li>Know your customers </li></ul><ul><li>Take on leadership roles </li></ul><ul><li>Attend professional conferences </li></ul><ul><li>Network with industry professionals </li></ul>
  16. 16. Volunteering <ul><li>Volunteer to manage the finances of a community organization </li></ul><ul><li>Volunteer to work on a community project that involves </li></ul><ul><li>significant business activity </li></ul><ul><li>Review the financial health of a community organization and </li></ul><ul><li>provide feedback for improvements </li></ul>
  17. 17. Benefits of Developing Business Acumen <ul><li>Promotes teamwork </li></ul><ul><li>Fosters knowledge sharing environment </li></ul><ul><li>Gain understanding of how your department contributes to </li></ul><ul><li>organizational objectives </li></ul><ul><li>Ability to see how your actions make a difference </li></ul><ul><li>Continued… </li></ul>
  18. 18. Benefits of Developing Business Acumen <ul><li>Aligns your goals with those of the organization </li></ul><ul><li>Significantly increases chances for upward mobility </li></ul><ul><li>Increases motivation to learn </li></ul><ul><li>Creates comfort engaging in business or company specific </li></ul><ul><li>discussions </li></ul>
  19. 19. “ Without strong business acumen, workplace learning and performance professionals are merely transactional service providers who can be easily purchased in the marketplace.” Tom Thivierge, Director of Succession Planning for General Motors
  20. 20. Entrepreneurship Defined “ doing things that are not generally done in the ordinary course of business routine.” (Penn State University)
  21. 21. Develop Entrepreneurial Thinking <ul><li>Have a thorough understanding of the organization </li></ul><ul><li>Know how the organization operates and generates income </li></ul><ul><li>Know your competitors </li></ul><ul><li>Engage in intelligent risk-taking </li></ul><ul><li>Become an innovative thinker </li></ul><ul><li>Think like the owner </li></ul>
  22. 22. Understanding the Organization <ul><li>Familiarize yourself with the history of the organization </li></ul><ul><li>Get involved </li></ul><ul><li>Ask to learn how to interpret important documents </li></ul><ul><li>Know the mission statement </li></ul><ul><li>Identify ways you can contribute to the mission </li></ul><ul><li>Lead task forces </li></ul>
  23. 23. Understanding Operations <ul><li>Attend training offered </li></ul><ul><li>Know the strategic plan </li></ul><ul><li>Know your department’s business plan </li></ul><ul><li>Continually look for ways to develop yourself </li></ul>
  24. 24. Knowing the Competitors <ul><li>Ask customers how your organization measures up to competitors </li></ul><ul><li>Obtain and review the competition’s promotional literature </li></ul><ul><li>Use information about competition to look for ways for your </li></ul><ul><li>organization to gain the competitive advantage </li></ul><ul><li>Stay current with industry changes </li></ul><ul><li>Join professional associations </li></ul>
  25. 25. Engaging in Intelligent Risk-taking <ul><li>Make decisions that involve risks </li></ul><ul><li>View mistakes as opportunities to learn </li></ul><ul><li>Expect setbacks </li></ul><ul><li>Take initiative </li></ul><ul><li>Know the difference between a healthy risk and a foolish chance </li></ul>
  26. 26. Be an Innovative Thinker <ul><li>Foster a creative environment </li></ul><ul><li>Look for new ways to improve old routines </li></ul><ul><li>Have faith in your capabilities </li></ul><ul><li>Identify ways to empower yourself </li></ul><ul><li>Never assume that an idea won’t work just because its never </li></ul><ul><li>been tried before </li></ul><ul><li>Suspend critical judgment of ideas </li></ul>
  27. 27. &quot;I know I will be _________. Therefore I will be ___________. Fill in the blank.&quot; Ryan P. Allis, entrepreneur
  28. 28. Bibliography <ul><li>Bemthal, Paul R., Karen Colteryahn, Patty Davis, Jennifer Naughon, William J. Rothwell, and Rich Wellins. ASTD 2004 Competency Study: Mapping the Future New Workplace Learning and Performance Competencies. Alexandria, VA: ASTD Press, 2004. </li></ul><ul><li>“ Encouraging Entrepreneurial Thinking.” Motivational Magic Resource Database. October 17, 2008. </li></ul><ul><li>“ Entrepreneurship.” Penn State University. October 22, 2008. </li></ul><ul><li>Green, Raymond D. “Beyond Financial Literacy: The Importance of Business Acumen Training for Managers and Employees.” Paradigm Learning. October 22, 2008. </li></ul><ul><li>Stern, Barry and Bob Walters. “Build Your Business Acumen Workplace learning and performance professionals need to think and talk like their internal customers. Here’s how.” June 2005. American Society for Training & Development. October 17, 2008. </li></ul>