The recent Covid-19 Pandemic very clearly highlighted the value of having the 11 key business acumen skills you need in 2024 in order to survive in a very unpredictable market.
What is Business Acumen?
In short, business acumen is a person’s ability to understand various business situations and deal with them effectively in a way that brings the best outcome for those situations.
Business acumen has also been defined as having a “fundamental understanding of how a business operates, then using that knowledge effectively to make logical business decisions.” (Source)
Commercial acumen is a collection of knowledge, technical skills, and soft skills that can be used to impact an organization and its employees in a positive way. It means having business sense, or being business savvy.
Business acumen is one of the most important capabilities, in fact a must-have skill, to possess in the corporate world, or in the workplace. It is a key driver of success in every aspect of an organization.
In this article, you’ll learn in more detail what business acumen exactly is (what specific skills you need), why it’s so important, how you can develop it.
These are the 11 Key business acumen skills you need, in short:
⦁ Risk and opportunity management (ROM) skills
For a more detailed breakdown of these key business skills see below.
Why is it important to have business acumen?
Do you want to progress in your career?
Do you want your business to grow?
Without the key business skills that is unlikely to happen.
The reason you need business acumen, whether you’re an entrepreneur just starting out, an executive manager, or just a summer intern, is that business acumen directly affects your performance at work.
That is clearly seen from our discussion below of the 11 key skills for your business acumen.
Business acumen is the foundation of any organization, large or small. It is essential for building strong teams, to navigate through complex problems, and to execute successful strategies.
Just how important business acumen is to the well-being of an organization is emphasized by the fact that organizations employing people with strong business acumen are more likely to be the leaders of their industry in terms of growth, profitability, and market share. A study by the Economist Intelligence Unit (Source) showed that 65% of business leaders believed that a lack of business acumen limited their organization’s ability to successfully reach strategic goals.
11 Key business acumen skills you need in detail
Listed here are some of the most important skills you need in business, particularly in leadership roles.
⦁ Risk and opportunity management (ROM) skills
A key way of enhancing your business acumen skills is to fully understand the consequences of decision-making.
Generally, to every situation there is a compromise and therefore it is often difficult to actually make decisions, particularly when under pressure to perform. The ability to assess various prospects and risks is part of the decision-making process. They become more manageable when you can comfortably weigh your choices and potential outcomes to choose a path that delivers the most benefit to your organization or business. (To read a more detailed post on crisis management, click here.)
How do you define risk and opportunity?
- Risk: A potential problem, or threat, that affect the performance, schedule, cost, and financial objectives or a project or program
- Opportunity: A potential improvement that could affect the performance, schedule, cost, and financial objectives or a project or program
Here are the top 6 risk management skills you need:
1. Industry and market knowledge
2. Good understanding of the technicalities of your business
3. Personal stress management, being able to perform and to make sound decisions whilst under stress
4. Strategic thinking and problem-solving skills
5. Good grasp of business finance
6. Communication and negotiation skills
⦁ Leadership skills
One important component of business acumen is leadership and management skills.
Any business with poor leadership is guaranteed to have issues that will hamper its growth, if not doom it to fail. Leadership and management skills are not just important for individuals in leadership positions but also for any employee. These are skills that employers actively look for in new recruits.
Strong leadership skills will allow the person to inspire and motivate the work force. It will help build respect among the staff. It will help them understand the needs of employees and what to do to meet those needs, resulting in a more cohesive and efficient work environment which is conducive to greater productivity and lower staff turnover.
(You can read a more in depth discussion of the vital skills you need to be a successful leader here.)
Top 10 leadership skills included in a person’s business acumen ‘portfolio’ include:
⦁ Having a sense of commitment
⦁ Being trustworthy, honest and reliable
⦁ Able to manage time effectively
⦁ Good organizational skills
⦁ Having a positive attitude
⦁ Being self-motivated
⦁ Being innovative
⦁ Having integrity
⦁ Being able, and willing, to delegates
⦁ Being able to motivate and inspire others to perform the best of their ability
⦁ Interpersonal skills
Interpersonal skills are crucial for friction-free, effective co-operation within teams of workers.
Interpersonal skills are the skills we use every day when we communicate and interact with others. These skills are strongly associated with emotional intelligence, being able to manage our emotions and attitudes for the greater good.
Empathy is a great example of an interpersonal skill. Being empathetic helps you understand business decisions from the perspective of others and to understand business situations as a whole. You can increase your empathy by understanding different personality types and how to get the most out of them.
What are the top 15 interpersonal skills you need as part of your business acumen?
1. Self-confidence
2. Workplace etiquette
3. Work ethic
4. Positive attitude
5. Relationship management
6. Conflict management
7. Receptiveness to feedback
8. Collaboration
9. Listening
10. Body language
11. Negotiation
12. Assertiveness
13. Patience
14. Self-confidence
15. Empathy
⦁ Financial acumen
Financial acumen refers to an individual’s financial knowledge and understanding, the ability to understand processes related to financial skills, such as reporting, budgeting, and forecasting.
It is the ability to make good judgements and quick business decisions, based on the available financial information of the business.
Those with financial acumen are able to see the impact a decision will have on the financial health of a team, department, or organization.
A very simple example of having financial acumen: A business owner with financial acumen understands that paying for regular maintenance reduces the risk of expensive repair and replacement bills.
As a ‘business savvy’ person you must understand what drives cash into and out of the business, as well as how to maximize profits and minimize losses. A person with financial acumen has decent understanding of bookkeeping and accounting, how to create and manage financial reports, as well as cash flow management. For more on this subject, see my article “The Ultimate Guide to Financial Management: Strategies for Success In Business Finances“.
Good financial acumen skills needed by all in business include:
⦁ To be able to analyse the company’s financial report and statements
⦁ To be able to understand financial performance metrics
⦁ To be able to prepare budgets and to implement them
Included too are:
⦁ Credit and debt management
⦁ Cost control
⦁ Pricing strategy creation
⦁ Tax strategy creation
⦁ Strategic thinking ability
Strategic thinking is another key skill within business acumen.
Strategic thinking refers to a person’s ability to think on a big and small scale, long and short term, and into the past and the present. It is an ability to gather data, learn from the past, and create a vision for the future; to create strategies to reach company goals, having foresight and awareness of what could potentially happen in the future. It may also include the ability to challenge the conventional thinking about the fundamental drivers of a business.
What do good strategic thinking skills include? They include:
⦁ The skill to prioritize
⦁ To be able to adapt
⦁ To be flexible
⦁ To be able to develop a strategic action plan
⦁ Market orientation
People with strong business acumen have a deep understanding of the market in which their business operates.
Being market orientated, or having a market perspective, means that you know your target audience – what they want and need, their buying patterns and power. Based on this knowledge you can create products and services that cater for the needs and desires of your audience / market.
A simple example: If a restaurant owner finds out that most of his customers are interested in eating burgers, he will try to create and serve them as per their demands and not try to convince them to try a pizza instead.
If you’ve ever watched the program Dragon’s Den, you’d know that one of the questions the “dragons” will always ask is “Who’s your nearest competitor?” Followed by “What can you offer that they don’t and that makes you better?”
Being market oriented it is absolutely vital that you know and understand these points. Market orientation allows you to make decisions that ultimately draw in more customers and increase sales.
These are the 5 marketing orientations:
⦁ The product orientation
⦁ The production orientation
⦁ The sales orientation
⦁ The marketing orientation
⦁ The societal marketing orientation
⦁ Ability to focus
The ability to focus is a challenging skill to master because in every business there is so many distractions. In order to make your team and your business successful you need to be able to sort through the noise and to focus on what makes a difference to your business.
For instance, if you are aiming is to increase the number of visitors to your website, you could get bogged down trying to create the perfect layout and design for your site rather than concentrate on what actually impacts the number of visitors to your site – like search engine optimization (SEO).
The ability to focus also enables you to achieve more any given day because you prevent your time from being wasted by tasks that aren’t driving success to your business.
Here are 7 steps to improve your ability to focus:
1. First you need to assess the current strength of your mental focus, identifying what areas you need to improve in.
2. Eliminate distracting factors – turn off the radio or tv, find a quiet spot to work, use positive thoughts to fight off distracting worries.
3. Concentrate your focus. Though many believe they are good at multitasking it is actually not possible to focus properly on more than one thing at a time. To the opposite, multitasking actually cuts down on productivity. So, give your full attention to one thing at a time.
4. Be present. It is pretty much impossible to focus well if you’re thinking about the past or worrying about the future instead of being tuned into the present moment. Being present in the here and now keeps your attention sharp and hones in your mental resources on what really matters at the time.
5. Practise mindfulness. Research has shown that those who practise mindfulness have higher levels of concentration and focus than those who don’t. They are able to stay on task for longer, they switch between tasks less frequently, and are able to perform their work more efficiently than others.
6. Take a break. The longer you try to focus on a particular subject or matter the harder it becomes to remain focused and as a result your performance begins to suffer. So, when immersing yourself into something that will require a prolonged period of concentration, make sure you schedule in regular short mental breaks.
7. Practice, practice, practice. Improving your mental focus is not a quick thing. It takes practice to strengthen your concentration skills. Keeping in mind the benefits of doing so may help you to stay motivated in your efforts to improve. By building your mental focus you will be able to accomplish more in your life and work and you’ll be able to concentrate on things in life that truly matter, things that bring you joy, satisfaction, and success.
⦁ Analytical skills
Having business acumen also means having good analytical skills.
Analytical skills refer to a person’s ability to gather, collect and analyse data; to deconstruct information into smaller categories in order to draw conclusions. This important skill involves taking in new information and mentally processing it in a productive manner.
Analytical thinking allows you to see problems or scenarios from different angles so that you are better able to devise strategies to deal with these. Analytical skills are closely linked with problem solving and decision-making skills.
7 must have analytical skills within business acumen include:
⦁ Complex problem-solving skills
⦁ Having technical skills
⦁ The ability to do thorough research
⦁ Good numeracy skills
⦁ Attentiveness to detail
⦁ The ability to make wise, and even difficult, decisions
⦁ The ability to think critically
⦁ Marketing skills
To give your business the best chance of success, you need marketing skills as part of your overall business acumen.
These skills are especially important those in leadership and managerial positions.
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What are marketing skills?
At its core, marketing is about communicating to an audience. So having marketing skills means being able to express yourself and convey concepts to others in a clear, engaging way. Off course, before trying to market anything successfully you also need to be able to analyse your target audience – what are their needs and preferences? Then identify the most important features of a marketing campaign.
Public speaking and writing skills are essential in order to effectively communicate your marketing strategies.
As part of a strong business acumen, good marketing skills include both soft marketing skills and hard marketing skills. What are they?
Soft skills are quite broad and widely applicable, and are necessary in many different careers. Hard skills are more focused on technical abilities and familiarity with specific tools and strategies.
The top 16 Soft Marketing Skills include:
⦁ Communication skills
⦁ Research skills
⦁ Creativity and problem-solving skills
⦁ Critical thinking skills
⦁ Attention to detail
⦁ Interpersonal skills
⦁ Cross team collaboration skills
⦁ Adaptability
⦁ Learning attitude
⦁ Organization skills
⦁ Know how to set goals, strategies, and tactics
⦁ Being an attentive listener
⦁ Being persuasive
⦁ Google Analytics knowledge
The top 14 Hard Marketing Skills include:
⦁ Writing skills (content and copy writing)
⦁ Project management
⦁ Research
⦁ SEO / SEM
⦁ CRM
⦁ Social Media data analysis
⦁ Email marketing
⦁ Website management
⦁ Technology skills
⦁ Understanding the basic principles of design
The Centre of Excellence offer an Internet Marketing Strategies For Business Diploma Course. Through this internet marketing course you will learn the many ways to market a business online and how each element works independently and together.
⦁ Problem-solving skills
Problem-solving skills are yet another important component of a strong business acumen.
These skills refer to a person’s ability to handle unexpected or challenging situations at work in an effective way. It means to have the skill to find solutions to difficulties using generic or ad hoc methods in an orderly manner.
Strong problem-solving skills enables you to work out the source of a problem and to come to a viable solution. Good problem-solving skills are valued by most employers. In fact, anyone within the company can benefit from having strong problem-solving skills.
Your business acumen should include these 9 important problem-solving skills:
⦁ Team-building skills
⦁ Time management skills
⦁ Research skills
⦁ Communication skills
⦁ Decision making skills
⦁ Dependability
⦁ Active listening skills
⦁ Creative thinking
A person with strong problem-solving skills can…
1. Recognise that there is a problem
2. Analyse and identify the root cause of a problem
3. Describe the problem understandably to others
4. Develop possible solutions
5. Implement the solutions
6. Measure the results
It has been said that being able to solve problems effectively separates great leaders from the average ones.
⦁ Communication skills
Communication skills have already been mentioned several times as part of the different aspects of a strong business acumen.
The ability to communicate effectively is beneficial to employees of all levels as this enables them to function more effectively in their positions. Good communication skills enable you to understand others and to be understood yourself. For a more in depth discussion on how to improve public speaking and communication skills, read my post “43 steps to improve your public speaking skills in 2024“.)
15 of the most important communication skills, in terms of business acumen, include:
⦁ Listening skills
⦁ Presentation skills
⦁ Clarity
⦁ Friendliness
⦁ Concision
⦁ Active listening skills
⦁ Nonverbal (written) communication
⦁ Confidence
⦁ Empathy
⦁ Emotional intelligence
⦁ Respect
⦁ Honesty
⦁ Open-mindedness
⦁ Feedback
How can you develop strong business acumen?
No that you what business acumen is, it must be comforting to know that anyone can learn the skills to obtain strong business acumen!
There are many ways to develop business acumen:
Through personal mentoring, through experiential learning through business simulations, and even through board games!
Learning how to run a business is challenging. Just by working a corporate job doesn’t automatically mean that you acquire the knowledge that leads to success in business. The truth is, a lot of people work for many years at a position without advancing in their career. So how can you obtain skills that lead to business success?
Demonstrate that you have business acumen! It is a powerful means of growing your business or advancing your career. We’re not talking about “gut instincts” or having good ‘business sense’. Rather, having a set of definite skills and an approach to business that increases your chances of achieving your goals.
Examples of people with strong business acumen are business leaders such as Lee Iacocca and Steve Jobs.
In Conclusion
Having the above 11 key business acumen skills is vital in order to, not just survive in this unpredictable and competitive world, but also to grow as a business.
Your business skills play a crucial part in convincing customers, employees, and shareholders of what your business model is about and why it should always be in first place.
Further, in a constantly changing and developing business world, people at all levels in organization need to understand, value, and contribute in a positive way to situations that impact a firm’s operations.
