One of the behavioural

competencies for business

leaders is business acumen.
This should come as no
surprise to anyone. It’s
important to know the
business, be able to talk about
it, and make decisions to help
the business grow.
Business acumen isn't a single skill, but a much broader
set of competencies that require understanding across
multiple aspects of a business.

Business acumen is the term used to describe a

person’s understanding of various dimensions of a
business that are “in play” as situations arise. This
“business common sense” is built up over time, just
like musicians or pilots, who get better with practice.

“Business Acumen is a combination of knowledge and

skill informed by experience: knowledge about key
business issues, the skill to apply that knowledge, and
the confidence to take action informed by past
experiences.”
Business Acumen Means…

1. You understand how a company makes money

2. You understand how your company makes money

3. You understand how your customers make money

The key elements of understanding
how any company makes money include:

o The company’s business strategy

o The goals and objectives of the company
o The financial metrics of the company
o The size of the company’s potential market
o The customer segments that make up a market
o How the company markets itself to create awareness
o How the company sells its products / services
o How the company produces its products / services
o How the company get its products / services to its
customers
o How the company receives the cash for the value
o How the company adjusts its strategy and moves
forward
A person with good business acumen will:

i. Be able to obtain essential information.

ii. Be able to focus on the key objectives.
iii. Be able to recognize the options available
for solving problems.
iv. Be able to select the right approach to
overcome those obstacles.
v. Be able to set in motion the plan that gets
things done.
How do I develop business acumen?

i. Understand the business model

• Learn unfamiliar areas
• Understand the different strategies

ii. Learn the financials

• Understand and track key financial
metrics
• Get help
 iii. Seek education
• Stay informed
• Follow business leaders

iv. Listen to customers

• Qualitative Research
• Quantitative Research
Developing your business acumen takes time, but as soon
as you start down the path of building it up, you can
immediately start to apply your knowledge. Over time
you’ll be a master of key business concepts.

You’ll know you’re on the right track when your decision-

making is faster, you’re able to pivot effectively when
things don’t go according to plan, and the results of your
decisions are frequently spot-on.