In order to perform your job duties to your highest ability and provide lasting value to your organization, it’s imperative that you understand and consistently practice the definition of business acumen in your day to day work. Sometimes, in order to be good at your job, it helps to know a lot more than just how to do your job. Employees who have a larger grasp of all the different aspects of their company are more valuable to their employers than those who only know how to show up, do their own work and then go home. The better you understand your business and your industry, the more value you can create for your company.
In the next few minutes, you’re going to learn about how you and others in your organization can benefit from business acumen. You will also find a few pieces of advice to help you further develop it yourself and put it into practice. But first, it will help to define exactly what the term means.
Definition of Business Acumen: What Is This Term?
Business acumen is basically a general understanding of how to successfully operate a business and make it profitable, coupled with the ability to make sound business decisions quickly. Unfortunately, it’s not uncommon for employees today to understand their own job responsibilities – and how their own department functions – but nothing more.
As a result they are unable to see how their contribution and daily decisions affect the company’s operations and profitability as a whole, which occasionally leads them to take actions which seem harmless on a micro level. Yet, they are actually detrimental to the success of their business on a macro level. But companies want managers and leaders who are better able to see the larger picture and to contribute to the overall mission of the company.
Why Develop Your Business Acumen
If you are a manager in a mid- to large-scale business, it is absolutely imperative that you develop your own business acumen. And if you are a hands-on small business owner, your company will succeed or fail based on your ability to manage every aspect of your business. You don’t necessarily need to know how to do every single task that needs to be done – and attempting to do so will likely cause you to become overwhelmed and mess something up. But you do need to know enough about how your business functions in order to oversee your employees. This will help you ensure the quality of their work and processes.
But even if you are just an entry-level employee, developing your understanding of your organization and of businesses in general can only help you to create more value for your employer. It also offers you greater job security and career advancement potential for yourself.
How Developing Your Business Acumen Can Help Your Business
- Make better/faster decisions: Being able to make solid business decisions without delay is one of the best benefits of business acumen. The better you know your products and services, and the better you understand how all the different aspects of your company fit together to bring your product to market, the more decisive you will be when faced with challenges large and small.
- Improve your mobility and advancement opportunities: Having a firm grasp on how your company functions and how all the pieces fit together moves you into the top tier of employees in your organization. Companies are always on the lookout for future leaders who can see the big picture and move them forward to higher levels of growth. The leaders at the top of an organization – particularly C-level executives – demonstrate the highest levels of acumen and business comprehension.
4 Areas to Tick When Putting the Definition Of Business Acumen into Practice
1. Become an Expert in Your Organization and Your Industry
If you want to further develop your level of business acumen, the place to start is by expanding your knowledge. Read everything you can get your hands on about your:
- Products and services;
Always learn. Attend seminars and courses that relate to your industry. Ask your boss for more training, work and responsibilities.
2. Encourage Communication Among Departments in Your Organization
As an employee, try to spend some time with coworkers in other departments. This way, you can learn about:
- What they do;
- How your function in the company relates to theirs;
- How their activities fit into the overall growth of the company.
As a manager or owner, create opportunities for your employees to mingle informally but also to work side-by-side across departmental boundaries whenever it makes sense to do so.
3. Be Decisive in Your Job Activities
Discipline yourself to quickly rise to the challenge whenever tough decisions come your way in the daily execution of your work. Never procrastinate when it comes to making a decision.
- Consider your options;
- Seek out more information when necessary;
- Be open to the opinions of others;
- Make a decision and follow through on it.
4. Think and Act as if You Own the Company
Never bury yourself in your own little corner of the company. Always take interest in what is best for your company and how to increase your value and contribution. Think of yourself as the owner or CEO of the company.
If this was your business, you would surely learn and do everything you could to ensure its success. Let that motivate you to improve your skills and knowledge.
As you can see, the definition of business acumen is very broad in scope and should encompass all parts of your business. Competency in your own job responsibilities combined with a deeper understanding of your business as a whole can catapult your career and status within your organization faster than you ever thought possible. But it won’t happen by accident. Also, nobody will do it for you. You have to go after it!
So what are your thoughts and experiences regarding this topic? What have you been doing to improve your own business acumen? Please share your ideas and stories in the comments below.