In short, employees who practice and perfect their business acumen make financially smart business decisions
that align with executive priorities. And that's why some of the most respected and profitable companies in the
world have made business acumen training the foundation of their employee development programs.
Business Acumen Articles, Information, and Opinions
Business Acumen Definition
Business acumen is financial literacy and then some.
Business acumen is a concept pertaining to a person’s knowledge and ability to make profitable business decisions.
The dictionary defines acumen as Quickness, accuracy, and keenness of judgment or insight. It comes from the latin word acuere which means to sharpen. Acuere is also the root of the word acute.
We find that business acumen is often a missing link in leadership and management training today. While many aspects of business are taught in business schools (i.e. accounting, legal, marketing, advertising), these skills are specialized and segmented. This practice produces an excellent understanding of the profession, or skills, but creates distance from the whole of running or impacting a business.
We believe that every employee needs to understand how his or her role fits into the big picture and how he or she impacts the business.
Business Acumen & The Five Business Drivers
Business Acumen is all about managing the connections between Five Business Drivers that are essential to every business:
Business acumen combines financial literacy with professional competence to achieve this single goal: sustainable and profitable growth. It’s an overall strategy to help employees learn more about how your company makes money and how they can play a key role in the process. It’s very hard to run a successful business without a strong emphasis on Business Acumen. After all, if your employees are not making you money - then what are they doing?
Ram Charan teaches that business acumen requires an understanding of the building blocks of money making. Think back to how you learned physics or chemistry. First you had to understand the parts of an atom: electrons, protons, and neutrons. Once you understood the parts and how they interact, you were ready to develop your knowledge. It’s the same with business.
Businessmen and businesswomen who understand the The Five Business Drivers individually as well as the relationship between them are able to assess the total financial health of the business, articulate their findings, and advocate strategies that grow the company profitably.
The Five Business Drivers can all be measured and interpreted if you know how to read financial statements. But people with business acumen have gone beyond financial literacy. They understand the real meaning of the numbers and can visualize the decisions and strategies that the numbers are a result of. They instinctively sense the relationship between cash, profits, assets, growth, and people (employees & customers), and are able to create a mental picture of the total business.
Business Acumen: The Universal Language of Business
The Five Business Drivers also make up the universal language of business. Smart executives recognize that employees will be able to contribute more if they know what really goes on in the business. Making business acumen part of the corporate vocabulary breaks down organizational silos and bridges the communication gaps between employees.
Whether it’s getting your new workforce to work with your seasoned vets, or getting a culturally diverse workforce talking about the same things - business acumen invites everyone to participate and understand the business’s money making priorities. In short, business acumen helps employees become more valuable to the company.
Take the new Gen-Y college grad and the business savvy Baby Boomer. They may not have much in common and might find it hard to talk with one another, but if they both have business acumen they are threaded to a common understanding of how a business makes money. While one approaches business problems with a text message and the other likes to sit down and talk it out - the communication barrier doesn’t exist when talking about the financial health of the company.
A product manger in one country and an engineer in another may not understand the uniqueness of one another’s culture, but if they both strive to practice and perfect their business acumen they can come together to address the unique challenges and opportunities that the company faces.
Executives that recognize that business acumen plays a key role outside of the boardroom will be able to face the challenges of a rapidly changing and increasingly diverse workforce. From increasing business dialogue to breaking down department silos, speaking the language of business acumen will provide clarity that will help employees figure out the right priorities.
Business Acumen Solutions
A successful Business Acumen strategy involves many different areas of your company, starting with the executives, of course. But really all employees from customer-facing areas, like sales, marketing, and customer service to departments like HR, IT, and engineering benefit from a personal sense of Business Acumen. Acumen Learning offers training solutions for all those areas… and more.
Business Acumen for Managers ›
Business managers use their business acumen to make financially sound decisions for your business. From recognizing the cost benefits of implementing strategies that improve efficiencies to helping employees recognize how their day-to-day activities effect the financial strength of the company.
Business Acumen for Sales ›
Too often sales professionals don’t have an audience with CXO level decision makers, and when they do they can become intimidated. More often than not, it’s not a lack of confidence or sales savvy - it’s a lack of business acumen. Sales professionals with business acumen understand how their client’s make money and how their product or service will help bolster the process.
Business Acumen for HR ›
Too often Human Resources is viewed as a cost center, but HR professionals with business acumen are able to help others see Human Resources from an inside-out point of view; helping employees and other department heads see how HR impacts the company’s bottom-line.
Business Acumen for Finance ›
Just because your accountants understand the books doesn’t mean they have business acumen. Accountants, auditors, investor relations and other professionals that report up through the CFO sometimes need business acumen training more than anyone else. While they understand the books, they struggle communicating the relationship between financial numbers and corporate strategy.
Business Acumen for Technical Professionals ›
Business acumen can help engineers understand how their projects affect the business. For example, an engineer with business acumen would be able to analyze the cost advantages and disadvantages of using one material over another. IT professionals use their business acumen to better understand the needs of their internal customers and how their service impacts efficiency, and how efficiency impacts the numbers.
Seeing the Big Picture
Business Acumen to Build Your Credibility, Career, and Company.
The most successful business leaders are savvy businesspeople 1st
An MBA in under 180 pages, Seeing the Big Picture simplifies the complexities of businesses large and small and shows you how a deep understanding of your company can help build the credibility and career you want. And it can make your work more fulfilling and purpose-driven by highlighting how you influence the success of your team, department, or organization.
All companies are driven to success or failure by the same five simple drivers: cash, profit, assets, growth, and people. Kevin Cope will help you appreciate how your day-to-day decisions can balance these drivers and contribute to the big picture of your organization’s success. You’ll discover the acumen you need to bring real value and passion to your work.
Whether you’re on the manufacturing floor or sitting in the corner office, you can learn how to follow the drivers through to measurable results— conquering your fear of numbers. Using Kevin’s simple explanations of the most important metrics presented in the income statement, the balance sheet, and the statement of cash flows, you’ll be able to quickly review financial reports for signs of success or impending doom.
Convincingly communicate your ideas to leaders, improve your team’s performance, even launch a successful business of your own. no matter your goal, give yourself the foundational knowledge every businessperson needs, and discover new strategies for proving your value.
Business Acumen Introduction
From the book: Seeing the Big Picture
The only real security that a person will have in this world is a reserve of knowledge, experience, and ability. —Henry Ford
Everything should be made as simple as possible, but not simpler. —Albert Einstein
Have you ever found yourself in one of these situations? You’re talking with a senior leader of your company and wish you could say something really insightful to show your knowledge of the business, but your brain goes numb and you can’t come up with anything meaningful.
You’re attending a meeting with managers or financial types and as they start reviewing financial statements, you get lost. You hope no one discovers that the smile on your face or the nod of your head hides the gap in your knowledge. You can’t see what the numbers have to do with what you have to get done today or this week.
Your CEO wants everyone to work harder to meet the company’s overall financial objectives. Your manager asks for ideas from the team, but you’re struggling to see how improving your job performance will impact the company’s revenue or stock price.
You’ve got a great idea for a weekend business that you and a friend or your spouse could start up to bring in some extra money, but you don’t know how much money you would need to get started or how to handle financial matters once you do. You just don’t want to be like all those other start-ups that flop.
If you’ve experienced moments like these, you certainly are not alone. In fact, you’re a member of a fairly large group—businesspeople who struggle to understand how the moving parts of a company work together to make it successful and how financial metrics like profit margin, cash flow, and stock price reflect how well each of those moving parts is doing its job.
The solution to your confusion is developing your business acumen, your ability to see the big picture.
What can Business Acumen do for you?
Years ago a colleague of mine was consulting with a group of senior NASA managers at Cape Canaveral. He tried to explain, in simple terms, an organizational change strategy. The managers seemed confused. In an effort to clarify, he said, “Please don’t make this more complicated than it is. It’s not rocket science.” To which they sincerely answered, “We wish it were. We’d understand it better!”
Many people, even those with jobs that others think of as incredibly complex, view their business much like rocket science: a lot of complexity, hard-to-understand data and formulas, communications in a language that barely resembles English. Yet most of them wish they could more clearly understand the business of their business and how to help their companies perform better. What they are wishing for is business acumen.
Business acumen is keen, fundamental, street-smart insight into how your business operates and how it makes money and sustains profitable growth, now and in the future.
In 2002, after ten years as an executive with FranklinCovey, consulting with and teaching for dozens of organizational clients, I founded my own training and consulting firm, Acumen Learning. We created and began delivering the Building Business Acumen® seminar. Over the last ten years we have expanded and deepened the initial course. Our focus became the practical application of business acumen to help people—at all levels, in any company, in any industry—become more effective in their current jobs and more successful in their future careers.
After working with more than eighty thousand participants in more than thirty countries, including many clients in the Fortune 500 and sixteen of the Fortune 50, the primary lesson we’ve learned is that businesspeople want to become more effective and valuable, to secure their seat at the table and influence decisions, to impact company performance. They want to use their full potential to help their business make money and sustain profitable growth.
They want these things for two reasons. First, we all instinctively seek out greater engagement—a way to feel that the work we do is worthwhile and makes a difference. Second, they understand something crucial. If you want to be in a better position—a job you like more with better pay, better long-term opportunities, and greater security, for example—you need to understand the key drivers of business and use that knowledge to make good things happen.
To do that, you need the ability to
See the “big picture” of your organization—how the key drivers of your business relate to each other, work together to produce profitable growth, and relate to the job you do each day
Understand important company communications and data, including financial statements
Use your knowledge to make good decisions
Understand how your actions and decisions impact key company measures and the objectives of your company’s leadership
Effectively communicate your ideas to other employees, managers, and executives
For some of you, this list might resonate immediately. For others, it might raise an important question. Why should you care? Isn’t making these connections the responsibility of the executives, the senior leadership, or maybe your boss? Not if you want to be doing something different and better in your career three years from now.
If, through your questions, ideas, comments, analysis, proposals, and performance, you exhibit business acumen, you will be seen as a more valuable contributor. You will demonstrate your worth to the company, and other people will notice.
And that, in a nutshell, is the path to success in almost any career.
Robert was an excellent call center supervisor… or so he thought. He was dedicated to saving the company money because he was worried that they would outsource the call center to an overseas operation. He rarely recommended employees for recognition or raises. If his team presented ideas about new software or equipment that could improve productivity, he would listen but never take them to management for consideration. And he constantly harped on the importance of getting through calls as quickly as possible and up-selling customers as much as possible. He was fanatical about doing his job well.
Robert didn’t realize that his narrow focus on cost control and “doing his job well” ignored the big picture of how his company made money and sustained profitability. He wasn’t connecting the dots between his efforts, customer relations, and future sales revenue. Or the huge cost of employee turnover the company was incurring every time one of his employees left to go somewhere with better pay and a stronger focus on serving customers. He failed to consider the impact he had on efficiency, profits, and morale by refusing to raise his team’s ideas with management.
Ultimately, Robert was viewed by senior management as “a serviceable supervisor in need of development; not likely management material.” While he wasn’t let go, his performance reviews were never stellar and he could tell that he was being sidelined, but he didn’t understand why. Robert missed out on seeing the big picture of his main job: to contribute to building a company experiencing long-term, sustainable, profitable growth.
So many of us fall into the same trap. Like Robert, over time, we tend to become more specialized and get very good at focusing on the specific parts of our jobs, so much so that we fail to see the big picture— how what we do fits into the overall picture of helping the company make money, achieve its strategic objectives, and be profitable.
Some of us decide to get degrees in management, hoping to get that big-picture perspective. But while management education provides excellent training in areas such as accounting, marketing, or finance, students can graduate without an overall knowledge of how a business runs successfully. Their knowledge of the key drivers of business and how they work together can be fragmented, disjointed from the reality of daily operations.
And as with Robert’s managers, many leaders assume that their teams have a much stronger grasp of the big picture of how their companies grow profitably—greater business acumen—than they actually do, so few take the time to do on-the-job training to deepen that knowledge.
Do you think you’re better off than Robert? That you wouldn’t have made the same mistakes? Now’s your chance to prove it. Take the Big Picture Quick Quiz shown here. The questions were not picked at random; they are the result of research and interviews with hundreds of executives and CEOs from dozens of different industries. They reflect the areas of performance that senior leaders have on their minds and want employees to have on theirs.
We’ve administered the Big Picture Quick Quiz to over sixty thousand people. On average, people know the answer to fewer than two of the questions.
These questions focus on the overall business, not the operations of your department or division. I suspect that you might be more familiar with some of the performance measures for your immediate team. But your senior management team wants the entire business to be profitable, not just a single unit. They want all employees to understand and better contribute to how the entire company makes money.
Business Acumen Quiz
Answer the following questions based on your company’s performance in the most recent fiscal year. And don’t look up the answers!
How much cash was on hand at year-end?
How much cash was generated from operations?
What was the net income (net earnings, or net profit)?
What was the net profit (net income,or net earnings) margin?
What was the total revenue (or total sales)?
What was the inventory turnover (for retail and manufacturing firms)?
What was your return on assets?
By what percentage did total revenue (sales) grow or decline over the previous year?
By what percentage did net income (net earnings, or net profit) grow or decline over the previous year?
How do your results compare to your competition?
Now check your answers against any of the financial reports you have on hand. How did you do? How many questions did you get right? Do you even know where to get this information?
The problem is that while we understand our jobs, the big picture seems too complex to grasp. Complexity is an underlying challenge in any business, regardless of size, industry, or stage of development. Large companies, especially, have many moving parts—departments and divisions (always reorganizing), product lines (always changing), layers of management, competitive realities, unclear decision-making processes, regulatory pressure, shifting budgets, new strategies. A small problem within any single element might produce a ripple effect throughout the organization, requiring major repairs. But without knowing the true source of the difficulty (which is not always readily identifiable), we might “fix” the wrong thing as we tinker with the business.
Developing business acumen helps us cut through this complexity, get a bird’s eye view of a business, and understand our specialized roles within it. Simplifying complexity and broadening our understanding of the business enables us to fix present problems, prevent new ones, and take advantage of opportunities to grow.
How do we simplify the complex? By looking at the key drivers that make all the parts of a business run.
The Five Key Drivers of Business
When you break down even the largest, most complex multinational company—like Walmart, Apple, Toyota, or Boeing—into its most fundamental elements, you’ll find the same drivers that power your business, or any business. What are those drivers?
How did we distill it down to these five? We used the core financial statements—the statement of cash flows (cash), the income statement (profit), and the balance sheet (assets)—as the foundation. These are the statements every company uses to judge its current strength and its future prospects. The fourth driver, growth, is reflected in all of these statements and for public companies is an important objective for shareholders. And the fifth driver is quite simple: without good employees providing value to paying customers, the other four drivers cease to exist.
The 5 Key Drivers will help you understand and visualize how even the most complicated business can be analyzed and improved. Like the twenty-six characters of the English alphabet, the 5 Key Drivers combine in a multitude of ways to form the foundation of organization, products, market position, financing, human resources, and every other strategy or decision in a company. Leaders must set and achieve goals and obtain results in these five areas in order to achieve the most important objective for any company: long-term, sustainable profitability to support its mission.
You’ve probably heard of these essential elements, but you may not really understand their full importance and interdependence in creating success. While each driver is unique, it is also completely dependent on all of the other drivers, as shown in the model. You cannot affect one without influencing the performance of another. Leaders have to take the connections between the drivers into account as they make their decisions, or they risk becoming overly focused on one driver and running a business into the ground.
Your ability to understand these relationships and affect these drivers through your decisions and actions can increase your own ability to contribute to the long-term profitability and growth of your company. So in chapters 1 through 5, I will explore each of the five drivers in depth, explaining how they are defined, their importance to a ￼￼￼￼￼￼￼business, how leaders balance each of the drivers as they work toward strategic goals, and how any employee can influence them. In chapter 6, I’ll look at the big picture the five drivers create; how they relate to each other and work together to create sustainable, profitable growth; and how they are influenced by factors in the broader business environment. Management’s general objective is to achieve a balance among the drivers; supreme focus on one and neglect of the others can be disastrous over time. Throughout the book, I’ll offer up real-world stories to help you understand what the drivers may mean to your business, and I’ll use the hypothetical story of Austin’s Cycle Shop to deepen your understanding of how the drivers play out in a business month to month and year to year.
A key component of business acumen is being able to communicate about the 5 Key Drivers. The language of business is accounting and finance. And this means numbers. And numbers intimidate many people. But if you think of financial statements like you would a health report from your doctor, you may not be as intimidated. You don’t need to understand every number or how it was calculated, but recognizing a critical few pieces of information, those that reflect the 5 Key Drivers, will help you understand the health of any company.
While business acumen is more than just accounting, an important part of it is understanding a company’s “financials.” So in chapter 7 I’ll explain how financial statements work, and in chapters 8 through 10 I’ll take the three most important financial statements—the income statement, the balance sheet, and the statement of cash flows—and de-intimidate them, simplify them. I’ll show how these three financials measure the 5 Key Drivers and how they describe the real-world performance of your company. You’ll be able to look for and understand only the most important data and not be concerned with the rest of the complexity.
I encourage you to explore our website www.seeingthebigpicture. com, which offers tools, resources, and further education to help you continue to develop your business acumen.
Influencing the Whole
If you want to be more visible and valued, demonstrate that you understand how your department or unit fits into the big picture of the overall business.
If you want to influence the thinking and decisions of your supervisor or manager, address the topics that senior leaders, including your boss, are concerned about. Communicate your ideas and proposals in language that he or she understands.
If you want to be seen as a major contributor, show that you understand the relationships among the key drivers of your overall business— not just how your department works.
If you want to be a more effective leader, better able to engage your team, link your team’s actions with the overall needs and strategic goals of the company. Keep in mind, even your managers might not be as knowledgeable in some of these areas as you think. While they may be functionally brilliant, they may not see the big picture. But I encourage you to ask questions of the type raised in this book and be willing to act on the answers. You’ll be recognized as a contributor, somebody who demonstrates business acumen through savvy questions and effective actions.
I hope you’ll refer to the book and the resources in it often and apply them in your present job and throughout your future career.
Kevin Cope is not only a successful executive, he is also a trusted resource and confidant to business leaders from around the world, a sought-after keynote speaker, and the author of the national best selling book Seeing the Big Picture. For over twenty-five years, Kevin has promoted the idea that the brightest minds in business understand the essence of how a company makes money, and they use this knowledge to drive their decisions. These people have been described as having business acumen, and you’ll find them everywhere from the factory floor to the corner office.
Recognizing that business acumen is about seeing the big picture and not just about financial literacy, Kevin founded Acumen Learning in 2002, a training company that has gone on to teach Kevin’s 5 Drivers business model to some of the world’s most respected and successful companies. Kevin’s specialty is teaching employees and leaders how to speak the language of business as fluently as they speak the language of their department or function. Kevin believes that businesspeople who exercise their business acumen execute better, smarter, and faster business decisions that drive sustainable and profitable growth.
Please visit www.seeingthebigpicture.com to learn more about Kevin and his ideas.
Securing Your Seat at the Table
To know and not to do is not to know.
So you’ve learned a bit about how your company functions and how to tell whether it’s successfully growing and generating profit. What do you do now?
What I’ve provided here is just the foundation, a foundation you can turn into deep knowledge about how your company operates now and should operate in the future. Why go to the trouble? It’s the best and fastest way to prove your worth and to secure a seat at the decision-making table, something that can make your work more rewarding and your career more successful.
Securing your seat at the table means adding value, developing and continuing to exercise your ability to influence decisions and decision-makers within your organization. You must study business generally, your business specifically, and then make and act upon sound decisions.
Your application of business acumen requires a focus on the chief concerns and goals of your boss or CEO. You’ll need to develop and apply continued insights concerning market trends, competitor analysis, strategic choices, financial markets, consumer trends, and more. You’ll need to communicate effectively using the 5 Key Drivers within the context of your company’s strategic goals if you want to contribute to your company’s growth, and to your own.
As you grow in your influence at the decision-making table, you’ll need to stretch yourself, move outside your comfort zone. It can be challenging to find the time and energy, but the rewards will be worth it. Your knowledge and contributions will build your credibility, career, and company.
I challenge you to move forward with a commitment to do it.
In pursuing your personal or business objectives, you must never omit the hard work of preparation. An admiring audience member said to the virtuoso concert pianist, “I’d give my life to play like that.” The predictable response: “I have.”
Six Ideas For Building Business Acumen
Here are six practical ideas to encourage and support your ongoing development and application of sound business acumen.
1. Commit the Time to Study and research
Set aside time for regular study and research.
Your days are already full, crowded with professional and personal activities. Nevertheless, find opportunities to carve out the time to advance your credibility, your career, and your company. How much time do you spend watching television? Could you chat with coworkers less and read industry information more? Could you use your lunch time more productively? An hour of research even once a week will have a great payoff.
Whether you can spend an hour a week or a half-hour daily, set aside time for study and preparation—regularly. Then put it to use!
The Resources section in the back of this book offers a host of opportunities to learn more about business in general and your industry specifically. You can also sign up for our monthly newsletter or access other resources at www.seeingthebigpicture.com.
You should also devote time to learning how your company is organized and operates: its organization and internal structure, who the key officers are, your primary products and services, your present and future goals. Understand the important priorities, values, and strategies of your CEO, division head, and direct supervisor.
Do you know how your company is doing financially or what its financial goals are? Go deeper than the big picture of your company and explore the financials of each division or department if you can. How are the 5 Key Drivers being prioritized throughout your organization?
You can learn this by reading
the annual report;
e-mail and other communications from your boss and company officers;
company press releases;
materials on the company website;
quarterly Form 10-Q filings and annual 10-K filings;
and other resources about your company, including interviews of your senior leadership in all media. Ask your supervisor how to access additional internal operating data if it isn’t readily available.
Also, if you are an employee of a public company, listen to your CEO’s quarterly conference calls with Wall Street analysts. This quarterly call provides a current report on your company’s operations and financial performance and your CEO’s priorities and future plans. If you miss the actual call, an archived recording will likely be found on your company’s website in the investor relations section.
You should also know who your three to four most important competitors are and learn their basic financial data, strategies, products and services, and strengths and weaknesses. Read their annual reports, their websites, and information about them in the media.
Finally, learn what is happening in the external environment that might affect your company. Read or listen to financial, economic, and business news from websites and print and broadcast media, including books, magazines, the Wall Street Journal, and the business section of any large metropolitan daily paper.
As Harold S. Geneen, once CEO of ITT and father of the international conglomerate, once said, “When you have mastered numbers, you will in fact no longer be reading numbers, any more than you read words when reading books. You will be reading meanings.”
2. Talk with key company Managers
Build relationships with key leaders and managers at your company. Start with your boss or supervisor. Talk regularly with peers or teammates in different departments who have specific expertise. Ask questions that reveal your own research. Share your helpful insights in return.
Talk with your boss or supervisor about the big picture of your organization and how your team or department, and you personally, can have a more significant impact.
Learn the key measures and “dashboard metrics” that your boss and your division’s or company’s senior management are focused on. Discuss with your supervisor how you can better achieve these targets so you know how your team, and your job function, fit in.
Setting up these discussions need not be complicated or overly formal; meet people for lunch, or set brief appointments in their offices.
Let your reasons be known: you want to become more knowledgeable in order to make more effective contributions.
3. Be Proactive—contribute and Follow Through
Whenever an assignment or opportunity for action results from your study, discussions, or meetings, follow through and do it. Report back in a timely way to the appropriate parties so others will realize you have done it!
When realistic or appropriate, put your comments and questions into succinct, meaningful, and timely e-mails or memos addressed to appropriate personnel. However, don’t overwhelm people with a flood of ideas or recommendations. Be targeted in your approach.
Draw up a brief written action list concerning any or all of the 5 Key Drivers. Link your actions to results that “move the needle” in areas important to your boss and senior management and that support the key measures they have identified. Identify in writing how your actions impact the drivers. Give a copy to your boss or supervisor and discuss.
4. Attend industry Meetings and Make Outside contacts
If your company provides any occasion for you to attend industry conferences or major customer meetings, take the opportunity. Network with those you meet there. Read the literature available. Grow your own database of contacts. Keep in touch with them over time, as possible. Gain your own direct sources of helpful industry, economic, or business information. Stay in communication with those you meet.
5. Find a Mentor
Ask a coworker—maybe a peer or senior manager—to work with and mentor you. Your partner should be someone to whom you can make a commitment regarding your business acumen action plan and to whom you can be accountable. That person may want to further his or her own knowledge, and you can help and support each other. Being a mentor to someone else will help you both.
Above all, be accountable to yourself in your assignment to see your company’s big picture and continue developing your business acumen.
6. Influence Management
To influence senior management, you have to follow all of the above recommendations as you prepare yourself to present an idea or opportunity. Then, when asking a leader to consider seriously your views or recommendations, follow these four important suggestions—principles that have worked for thousands of employees across many industries and types of companies:
Listen to understand: Listen first. Your sole purpose in listening? To understand where the individual or management team is coming from, to get what’s important to them. In every meeting, listen carefully for opportunities to ask insightful questions and learn even more. If you deeply understand their point of view, their needs and priorities, it will first influence you. Then you’ll be better equipped to influence them.
Present their case and needs to them: Once you have listened deeply, make a “my understanding of your needs and objectives” summary before making your own proposals. Once managers know that you really do understand their perspective, they will be more open to listening to your analysis and proposals. You’ll have built greater trust.
Speak their language: Once you’ve established mutual understanding, connect your analysis and recommendations to their strategic goals, concerns, and needs. Link your message to what’s important to them, in financial language they understand. Demonstrate the impact of your proposal or analysis on those drivers important to them. Remember that every department or function has differing priorities.
Use ROI analysis: Ultimately, every business decision boils down to determining how best to use cash for maximum return on investment. Make a convincing case for a favorable ROI through your recommendation. (Refer to chapter 3 for more on ROI, or go to www.seeingthebigpicture.com to download a more complete explanation of calculating return on investment.)
Your Value Add
Your ultimate ability to become a more valuable, and valued, employee is primarily up to you. Your contribution to the success of your department, division, or company will add to your own success. Helping others along the way will add dimensions of experience, knowledge, and insight that will benefit both them and you.
As you become better known for your insightful business acumen, you will become more credible as a contributor and more valued as a member of your company, thus building your career. Wherever your career takes you, your ability to understand and implement the 5 Key Drivers and to exercise the acumen associated with them will lead to sustained success.
I encourage your continued commitment and hard work. Persevere. I’m confident it will pay off!
The Beginning of My Story
When I first got out of college, I began my career in banking. I will always remember my enthusiasm and my desire to excel in my first job after college, to set the organization on fire with the sheer brilliance of my performance.
Well, as it turned out, I created more smoke than fire. I quickly realized how little I had actually learned in school. I struggled even to keep up a stumbling pace with my associates who had spent just a few years in the real world.
I remember how there was nothing more discouraging than being dressed for success and feeling like a failure—sitting in a meeting with managers and senior executives, totally in over my head, trying to follow basic concepts of the financial discussion.
I was usually at a loss to make any intelligent comments, much less any meaningful contribution. I regularly found myself hoping that no one would call on me for anything important, in case I actually had to say something and reveal that I had only faint clues as to what they were talking about.
So, early in my career, the embarrassment of ignorance compelled me to make a commitment to competence.
There is no more empowering feeling in business than that of being in the company of experienced leaders and being able not only to follow the flow of their discussion but to make intelligent contributions to it. There’s nothing like sitting in an important meeting with colleagues and managers and having everyone nod his or her head in acknowledgment of your insightful comments and recommendations.
I wrote this book simply to educate and encourage you. Please believe me when I say, “If I can do it, you can do it!” Really! Anyone can build business acumen. The key will be to move forward, adopting Nike’s slogan at face value. Just do it!
Whatever your background, schooling, or experience, there is nothing about the 5 Key Drivers that is beyond your grasp.
I sincerely hope that you will make a commitment to building your business acumen through ongoing study and action. Continue to use this book as a reference guide, a resource.
The ultimate key? To engage. My very best wishes for your success, and my encouragement once more to stay with it! Remember . . .
What lies behind us and what lies before us are tiny matters compared to what lies within us.
Business Acumen - An Element of Trust
Character & Competence
About Stephen Covey
Stephen M. R. Covey is a sought-after and compelling keynote speaker and advisor on trust, leadership, ethics, and high performance. Stephen is the author of The SPEED of Trust, a groundbreaking and paradigm-shifting book that challenges our age-old assumption that trust is merely a soft, social virtue.
Stephen is co-founder of Acumen Learning and the CEO of CoveyLink Worldwide. He also currently serves on the board/advisory board of several entities, including the Human Performance Institute —the leader in energy management technology— where he serves as Advisory Board Chairman.
Stephen’s Thoughts On Trust & Business Acumen
The first job of any leader is to inspire trust. Trust is confidence born of two dimensions: character and competence. Character includes your integrity, motive, and intent with people. Competence includes your capabilities, skills, results, and track record. Both dimensions are vital.
With the increasing focus on ethics in our society, the character side of trust is fast becoming the price of entry in the new global economy. However, the differentiating and often ignored side of trust — competence — is equally essential. You might think a person is sincere, even honest, but you won’t trust that person fully if he or she doesn’t get results. And the opposite is true. A person might have great skills and talents and a good track record, but if he or she is not honest, you’re not going to trust that person either.
The best leaders begin by framing trust in economic terms for their companies. When an organization recognizes that it has low trust, huge economic consequences can be expected. Everything will take longer and everything will cost more because of the steps organizations will need to take to compensate for their lack of trust. These costs can be quantified and, when they are, suddenly leaders recognize how low trust is not merely a social issue, but that it is an economic matter. The dividends of high trust can be similarly quantified, enabling leaders to make a compelling business case for trust.
The best leaders then focus on making the creation of trust an explicit objective. It must become like any other goal that is focused on, measured, and improved. It must be communicated that trust matters to management and leadership. It must be expressed that it is the right thing to do and it is the economic thing to do. One of the best ways to do this is to make an initial baseline measurement of organizational trust and then to track improvements over time.
The true transformation starts with building credibility at the personal level. The foundation of trust is your own credibility, and it can be a real differentiator for any leader. A person’s reputation is a direct reflection of their credibility, and it precedes them in any interactions or negotiations they might have. When a leader’s credibility and reputation are high, it enables them to establish trust fast — speed goes up, cost goes down.
Business acumen training plays an important role in establishing trust within an organization. First, business acumen builds business competency, and second; it teaches business leaders how to tie the financial impact of trust to the financial statements. The combination of character and business acumen builds trust between co-workers, partners, and customers… resulting in faster and more profitable business decisions.