Business acumen

Business acumen ("Business savvy" and "business sense" are often used as synonyms) is keenness and quickness in understanding and dealing with a "business situation" (risks and opportunities) in a manner that is likely to lead to a good outcome. The term "business acumen" can be broken down literally into the definition would be "keenness and quickness in understanding and dealing with a business situation". ^[weasel] Additionally, business acumen has emerged as a vehicle for improving financial performance and leadership development. Consequently, several different types of strategies have developed around improving business acumen.

In his 2012 work, Seeing the Big Picture, Business Acumen to Build Your Credibility, Career, and Company, Kevin R. Cope put forward that an individual who possesses business acumen views the business with an "executive mentality" - they understand how the moving parts of a company work together to make it successful and how financial metrics like profit margin, cash flow, and reflect how well each of those moving parts is doing its job. Cope proposes that an individual who has the following five abilities could be described as someone having a strong sense of business acumen:

Raymond R. Reilly of the Ross School of Business at the University of Michigan and Gregory P. Reilly of the University of Connecticut document traits that individuals with business acumen possess:

Thus, developing stronger business acumen means a more thoughtful analysis, clearer logic underlying business decisions, closer attention to key dimensions of implementation and operation, and more disciplined performance management.

Financial literacy is a comprehensive understanding of the drivers of growth, profitability, and cash flow; an organization's financial statements; key performance measures; and the implications of decisions on value creation. In a SHRM article entitled, "Business Acumen Involves More Than Numbers" Chris Berger, member of human resources at CTPartners, explains that business acumen starts with the ability to understand how a company makes decisions, and that leaders must be financially literate and be able to understand numbers on company financial statements. It entails the ability to take the knowledge of business fundamentals and use it to think strategically and then take appropriate action.

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