Investing in business acumen training is critical when it comes to strengthening an organization’s competitive edge. Business acumen is a deep understanding of how an organization executes strategy to achieve its objectives, how it delivers value, and how this all translates to financial success.
Employees who develop business acumen skills are better equipped to analyze complex situations and make informed decisions. They can also better identify opportunities, evaluate threats, and anticipate industry trends. As a result, they develop more innovative solutions that increase customer satisfaction.
The benefits of business acumen training
By participating in business acumen training, employees acquire the skills necessary to help them succeed. These skills include problem-solving, strategic thinking, and financial literacy. Business acumen also improves teamwork and collaboration, as being cognizant of the broader business context empowers employees to communicate in more constructive ways.
In addition to competency development, business acumen grants employees a stronger sense of ownership over their work because it gives them a clearer view of how they contribute to the bottom line. This clarity can bring about increased engagement and job satisfaction. It also helps foster the confidence needed to perform the requirements of their roles more efficiently.
Business acumen training can help everyone from individual contributors to directors learn how to identify and seize opportunities for growth. And multiple functions across an organization can benefit from training, not just teams responsible for finance management. For instance, sales teams can use business acumen to gain a better handle on market changes and trends, and adjust their tactics accordingly. This, in turn, allows them to improve their relationships with customers, and build credibility and rapport.
For organizations, the benefits are just as significant. Employees who participate in business acumen training are equipped to make decisions that are more closely aligned with organizational goals. These decisions can be directly linked to boosting financial performance. That’s because employees with strong business acumen have a greater understanding of revenue, profit margins, and return on investment (ROI). They can therefore make decisions that are financially responsible, budget conscious, and considerate of resource allocation.
Key components of business acumen training
Business acumen is as complex and dynamic as the business world itself. As such, training must include a range of topics. The depth of these topics depends on who is being trained and what the specific organizational goals are; however, the overall purpose should be standard across the board.
Ideally, by the end of a business acumen training session, participants will have a clear and thorough picture of how their role fits into the organization and how their efforts can help the organization prosper.
In addition to learning the basics of organizational structure and key performance indicators, participants of business acumen training typically develop the following:
Learners should walk away with a substantial insight into not only how money moves through the organization, but how their actions play a role in that process. To accomplish this, the training must introduce concepts such as revenue, expenses, profit margins, and cash flows. Participants should also learn how to analyze and interpret financial data so they can use the information to make better decisions.
Knowledge of consumers, competitors, and more
A key component of building business acumen is being aware of consumer needs, preferences, and trends. This awareness gives workers the capacity to make customer-centric decisions, and sets the organization up to receive higher net promoter scores and other ratings.
Business acumen training should also cover information about the competitive landscape, as this helps organizations refine their value proposition and seize opportunities that allow them to better distinguish themselves.
Additionally, training should develop a deep knowledge of the industry. In the Big Think+ lesson below, Neil Irwin – author and economics correspondent for The New York Times – describes how this knowledge must go beyond buzzwords. Demonstrating one’s expertise and understanding of the business environment requires authenticity.
Critical thinking, adaptability, and analytical skills
Business acumen training can develop specific skills to enhance an employee’s perception of the business landscape and improve their financial decision-making. These might include:
- Analytical skills – Strong analytical skills allow employees to identify patterns, evaluate advantages and disadvantages, and consider alternatives. All of this enables them to make data-driven decisions.
- Critical thinking – Employees who think critically can anticipate changes and make adjustments accordingly. They can evaluate potential risks and take the necessary steps to mitigate them, and they’re more aware of the implications of their decisions.
- Adaptability – Since the business world is always changing, adaptability is also paramount. Workers must not only remain up-to-date with industry and market practices, but understand the importance of continuous learning and growth.
When to get started
The ideal time to offer business acumen training is during onboarding. This sets a solid foundation, ensuring that employees are well aligned with organizational objectives and strategies from the start.
In addition to new-hire orientation, business acumen training can be beneficial for employees who have been recently promoted, or are taking on new roles. It’s also important during periods of change such as mergers, acquisitions, and major product or service launches.
However, developing business acumen skills should be considered a continuous process, not a one-time event. Learners should be encouraged to freshen up their skills regularly as part of their ongoing professional development.
Business acumen training can take many forms, from in-person workshops to online courses. Learning and development teams may also offer cross-functional discussions, coaching and mentorship programs, and shadowing opportunities.
To promote learning transfer, L&D teams can incorporate interactive exercises that let participants practice their skills, and provide access to resources such as quick reference guides that help reinforce the fundamentals.
And perhaps most importantly, L&D teams should ensure the program addresses current business challenges and objectives, so that it translates into actual business impact.