The Tangible Skills You Need as a Business Owner
Business Acumen is the capability to both know and demonstrate the key attributes of your role that allow you to succeed in running your business.
As Dr. Raymond R. Reilly, University of Michigan and Dr. Gregory P. Reilly, University of Connecticut state, business acumen, or business savvy and business sense, are the keenness and quickness in understanding and dealing with a business situation. Being able to weigh the risks and opportunities in a manner that is likely to lead to a good outcome.
Whilst some people have acumen innately or have developed it through experiences, the capabilities to run a great business can actually be a tangible skill set. You can learn to develop your business acumen and in turn have greater success.
In this article, we look at 11 main capabilities of Business Acumen. Simply being aware of these capabilities can significantly help the way you manage your business and improve upon your skillset as an industry leader.
1 - Mindset
Your mental attitude to business. Sometimes referred to as an unconscious bias.
In business as with life, we align with particular people, places, and things. These things make us feel safe and comfortable, and we react to them accordingly. However, there is also a connection between your mental attitude and your responses and interpretations of situations in business. The way you respond to clients, staff or suppliers can have direct influence on the way you might demonstrate your sense of business to others. If you have no awareness to your mindset in business, you can end up with a big disconnect with those you are dealing with, which can then lead to miscommunication.
2 - Foresight
The ability to take that step back, focus and take in the business as a whole picture. What is coming your way in the future. What is the marketplace doing, what do you need to be aware of?
It is the ability to detect favourable and unfavourable changes early and interpret those consequences for your businesses.
3 - Broad Scanning
Broad scanning is similar to foresight, it is big picture thinking. It is the ability to see the storm coming and being aware of what you need to do to prepare for the impact it will have. Will it miss you or hit you?
People who have this skill are likely to naturally seek customer feedback/reviews as they manage their business, to test and understand the marketplace. They have a strong insight into what is going on due to consistent research and consideration for the broader business.
4 - Strategic Alignment and Strategy
Strategic alignment is about creating, setting, and executing the strategies of the direction in which you want your business to go.
There is no point having a business plan if you do not have the strategy to achieve your goals and become successful. As we know, it is the choices and moves you make during the game of chess that determines the overall outcome.
5 - Resource Management
Funnily enough this is about managing resources. Whether this be your staff, your time, your finances, or your materials. The way you manage these resources is a strong determination of the ability to demonstrate resource management. It's rather pointless taking on extra staff if you are not going to use those staff to their full potential. Just like having too much or too little product or material, this can be a loss of income for the business. It defines your capability to meet the needs of your business or project as the business owner.
6 - Collaborative
The ability to work together and your demonstration of being able to work with others to achieve those common goals or objectives.
No one can be an expert in everything, it's necessary to collaborate with others to have a successful business. As a business owner this also includes making sure tasks are being delegated to the correct staff members or advisors. Ensuring they all understand their roles, to maintain a collaborative approach and achieve the goals of the business (which is why Strategic Alignment is also so important).
7 - Systems and Processes
One of the main cores of any business. Setting up your business and efficiently identifying the systems and processes that work for it. It is not enough to just integrate a system and hope for the best. It's not just a piece of software or technology, it is the people that drive the systems and processes as well. Your systems and processes should be an evolving (as required), and a fluently known document or app which ensures there is synergy between all systems, people, and processes of the business to achieve the outcomes that you want to work and be in control of.
8 - Decision Making
This one almost speaks for itself, but it is often a capability that is taken for granted as a lot of people struggle to make decisions. You can sit for too long, only to let an opportunity pass you by. Whether that is in relation to staff, or a market opportunity. Often, you can take too long to decide because you are trying to make the right decision 100% perfectly, when nothing is ever 100%.
If you find you struggle to make decisions effectively, think about building yourself a matrix, a framework to work from to help guide you in your business. It will allow to get into the habit of making decisions faster or making the right one in the first place. When you can make fast, consistent decisions heading in the right direction this also allows your staff, business contact or even suppliers to feel you are consistent in your approach leading to trust and knowing what to expect from you as a business owner.
9 - Talent Development
Talent development is more than just assessing or developing talent. It is about making sure that the talent you hire is correct and meets the performance needs of your business. The only way you can do this is if you have done an assessment of the business, your business planning, and you are following it.
It allows you to demonstrate as a business owner or in a leadership role your ability to know what your business and employees need. The ability to spend time and engage with your staff, to understand what they want. To give quality, useful feedback and constructive criticism and allows for the ability to develop long-term growth opportunities and outcomes for the staff and the business as a whole.
10 - Duty of Care
Duty of care is enshrined in all our institutions, just look at the medical industry for example, whether it is doctors or hospitals, there is a duty of care to patients. You- as a business owner- ethically have a duty of care to your clients.
Duty of care forms the ethical positioning, or demonstration of ethics within your business. It can cover your duty of care to self and staff, and the impact of your decisions and your actions, your language, how you communicate to staff, and other business contexts.
11 - Financial Literacy
Financial literacy, when it comes to your business as a whole, is not just about the profit and loss. It is not just the sales statement; it is all of it. From the cash flows to the budgets to the P&Ls, all the way through, understanding and interpreting this information and then your ability to take that data and apply it in conjunction with strategy or strategic planning. You have the information, now you must make use of it to help inform your decisions and understand aspects of your business.
So how confident are you in your Business Acumen capabilities? What skills can you improve upon?
Answering these questions is the first step to establishing your personal development with business acumen and improving how you navigate and approach your business.
If growing your Business Acumen skillset sounds like something you want to look into further, contact Sarah Eifermann from Helix Planning today. Sarah can help guide you on the how and where to improve your capabilities and create a healthy, successful, consistent way of managing your business.
M: 0421 079 415