What does it mean to have business acumen, and do you have it? Business acumen is critical in boosting your image and career prospects. It also plays a significant part in building your personal and professional brand.

This article will explore what business acumen is, how to develop it, how to use it, why it is so integral to your success, and how it impacts your professional brand. When your brand reflects solid business acumen, you have a powerful advantage to influence your career and opportunities. Are you leveraging your business acumen to effectively strengthen your brand?

What is Business Acumen?Business acumen is a foundation of knowledge about one’s company and global busi-ness and financial trends that enable you to quickly identify critical interconnections to make keen business decisions and influence others. Rommin Adl, executive vice

Accelerate Your Career: Business Acumen

When you develop a foundation of knowledge about your company, global business and financial trends, you can

quickly identify critical interconnections to make keen business decisions and influence others.

Exclusively for Supply Practitioners Establishing Their Careers. Vol. 2:4 December 2015

Engage // Elevate // Emerge

By Eileen McCulloch and Nila LaVanaway Charles

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president of BTS, refers to business acumen as a frame-work composed of financial acumen, knowledge of one’s external environment and understanding the “big pic-ture,” in the article “Business Acumen Demystified” at www.bts.com.

Financial acumen is based primarily on internal data. This means having an understanding of your company’s financial statements, key performance metrics, cash flow, drivers of profitability and how decisions impact the cre-ation of value. It is crucial that, at a minimum, you read and understand your company’s annual report. Further-more, you need to understand how your company makes money. This means understanding its value chain, your position within the value chain, and how different busi-ness functions are interdependent and impact the value chain. Finally, be aware of your organizational structure both operationally and from a financial-impact perspective.

Awareness of the external environment is also fun-damental to your business acumen. Who are your cus-tomers? What are their objectives and how do they define

the value they seek from you? You need to be aware of and analyze market data, including competitor and customer trends.

Successful aspiration to mid- and executive-level positions depends upon the culmination of connecting these data points to create a strategic “big-picture” perspective. The ability to comprehend the big-picture perspective and communicate it to others adds value to your brand. Let’s explore two examples of connecting the data point “dots” to create positive outcomes: 1) You collect spend information from multiple busi-

ness units within your company. You discover, unbe-knownst to the business units, that some suppliers are operating under multiple names. Your analysis reveals that several of your business units have contracts with these doing-business-as companies (DBAs). Moreover, each business unit is paying a different price for the same commodity from the same supplier. If you present your findings in the form of integrated analysis of this spend and supplier data, it could help persuade decision-makers to adopt your recommendations for negotiations with these suppliers and for a process change in ordering.

2) A strategic, big-picture perspective involves under-standing many factors. Your sourcing recommenda-tions, for example, could incorporate your awareness of rising labor costs in China and how new trade agree-ments might introduce risks to your costs. Your evalua-tion of suppliers’ ability to achieve lean and practice Six Sigma directly affects demand fulfillment. And your consideration of inventory and transportation costs, along with your customers’ demands, demonstrates your business acumen and builds your reputation as a valued influencer of executive decisions.

Relationship Management and NetworkingIf this sounds overwhelming, take heart. The good news is that you are in control of your destiny, and business acumen is learned and not hardwired. Certainly, you need to acquire knowledge about the news of the business world and how it is being practiced. However, there are other, equally important skills that you have already begun to develop in your experience connecting with others: Relationship management and networking.

Your ability to connect with others and develop relation-ships with diverse people has little to do with whether you are an introvert or extrovert. Networking is a skill that rests upon your desire to help others and allow them to help you. It also springs from your natural curiosity about how things work. It certainly depends upon your ability to discipline yourself to make time to create rela-tionships. Best of all, to hone this skill, you don’t have to read a book or pay tuition for a class. You simply have to show up and make an effort to speak to others.

There are many networking opportunities that can be generated by you or by external organizations. Sylvia Wilks, vice president of global sourcing and supplier relations for Starbucks, recalls a young professional who volunteered for a special program and demonstrated ini-tiative by speaking with a senior leader of the program to express his interest and desire to help. The young profes-sional asked strong and pertinent questions, leading the senior leader to invite him to participate in meetings that would satisfy his interest and increase his business acumen.

Similarly, Tracy Joshua, Ph.D., vice president, procure-ment for Kellogg Company, adds that this kind of passion,

First of all, there’s an important aspect of relationship management: Your ability to connect with others and develop relationships with diverse people has little to do with whether

you are an introvert or extrovert.

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curiosity and thirst for knowledge are critical to what she looks for when developing her staff.

Participating in a corporate-sponsored club is another great way to build relationships while satisfying your per-sonal interests. If your company does not offer sports or volunteer clubs, look into attending Institute for Supply Management® local meetings or becoming active in com-munity organizations. Dedicate Time to Expand Your KnowledgeThere’s another key thing to remember — you alone own your career development. No one can do it for you. Get-ting the most out of your networking requires planning, goal setting and time management.

Increase your business awareness and develop relation-ships concurrently. For example, set a SMART (specific, measureable, achievable, realistic, and time bound) goal of getting to know a particular colleague in another function to better understand what he/she does, and their rewards and challenges. For instance, as part of your meeting, identify how you can contribute to his/her workload or development. Here’s a sample goal: Once a week, over the next four weeks, I will secure a 15-minute information gathering appointment (or a lunch date) with each of four colleagues from logistics, sales, finance and legal.

As with any goal, increasing your business knowledge and developing relationships requires you to schedule and manage your time. Elevate the priority of your business acumen development. For example, use your electronic calendar to schedule time for this project. When Ashley Dutchak, general manager of global operations for Wil-liams-Sonoma, decided to expand her business acumen, she had to find time to make a focused effort to improve her knowledge. As Dutchak analyzed her work schedule, she realized she listened to music for 30 minutes every day as she prepared to go to work. She substituted business podcasts for the music and quickly built a sophisticated perspective of how her company relates to the rest of the marketplace.

Dutchak also encourages people to keep abreast of monthly earnings reports. “At Williams-Sonoma, these monthly exchanges between the CEO, CFO and market analysts are available by podcasts. The topics include ques-tions about and news of the world beyond the company, such as the West Coast port strike,” says Dutchak. This is an easy way to build business acumen, a component Dutchak considers non-negotiable to career success.

Putting Business Acumen to WorkIn a world where we’re more connected than ever, it’s crucial to make conscious, wise choices about how you communicate. Consider the importance of your audience, the medium you are using and the timing, then choose options that are appropriate. Your message’s context is important. Thus, strategically position the message to ensure clarity and that it reaches the intended receiver.

Identify your audience and their environment. To ensure your message is appropriate to the audience, know the roles of those you are addressing. Develop a situ-ational awareness so you can adjust your approach and style to avoid common pitfalls. For example, one of the biggest mistakes people can make is failing to respect the boundaries of informal versus formal communications. Of course, casual elevator conversation, a thoughtful discus-sion during a conference and a formal meeting presenta-tion demand different tones. Understanding your audience and tailoring your message appropriately will help you provide relevant and valued information rather than simply providing information for information’s sake.

Choose the appropriate communication delivery vehicle. Carefully select the medium you’ll use to transmit your message. Today you have more choices than ever, so knowing which one to use and when is critical. See the chart on the next page for general guidelines.

Be conscious of your timing. Timing may be the hardest element of communication to fully appreciate. By timing your communications appropriately, you reflect your business acumen. For example, playing devil’s advo-cate after a decision has been made will not win you any points and may hurt your overall brand. Or if a decision must be made by tomorrow, you must be succinct or risk being perceived as out of touch.

Also, be cognizant of the time required for communica-tion — this means the time it will take you to prepare and deliver the message, and how much time your audience needs in order to respond. Demonstrating unrealistic expec-tations (for example, rushing out a carelessly worded text, or pestering recipients for a reply moments after sending an email) reflects a lack of business acumen. Allow yourself and your audience sufficient time to prepare and respond.

Context is key. By contextualizing your knowledge, you’ll be able to ask the kinds of questions that impress others. Ernie Chachere, vice president of supply chain management for E. & J. Gallo Winery, recalls, “I was at

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a luncheon hosted by the CEO, Joe Gallo, with several junior professionals. Gallo asked his guests, ‘Do you have any questions for me?’ There were several, but one stood out. A young man asked, ‘I know China is an important market for us. How do the recent currency fluctuations impact our strategy?’ After the guests left, Gallo asked me about the young man who had asked the currency question and declared him to be ‘smart and impressive.’ ”

The Benefits of Demonstrating Business AcumenPutting your thoughts and recommendations into a broader context means knowing that what you say and how you say it will impact colleagues a step down and a step above in the value chain. Thus, Chachere advises previewing/rehearsing your recommendations with these colleagues to make sure your thinking is not siloed and reflects a broader perspective.

Dutchak appreciates when less-experienced team mem-bers demonstrate strategic perspective. “It’s not unusual to ask an analyst to identify the landed costs of putting inventory into a distribution center. The person with business acumen will go a step further beyond listing the variable costs and will tell me not only the fuel rates, but that fuel costs are decreasing around the globe and this is likely to mean an X-percent reduction of our costs over the next 12 months,” she says. “This shows the person thinks beyond the straight facts.”

Joel Greenberg, director, global accounts for APL Logistics, agrees that having a developed sense of business acumen

helps differentiate leaders from less-experienced pro-fessionals. “Person A comes to me and says, ‘We have a problem,’ and then identifies the problem. Nothing more. But Person B comes to me and not only tells me we have a problem, she tells me what it is, why it’s a problem, offers some solution options, identifies the risks of each option, and then asks for my perspective. Person B adds real value.”

“Demonstrating business acumen opens opportunities,” Greenberg continues. “What happens next is that Person B is recognized for her value-add and gets invited to additional executive meetings that her counterparts are not invited to.”

Overall, it’s not a question of what the benefits of having business acumen are, but how important it is to stand out to senior leaders and move up the corporate ladder. Chachere says, “If you want a career and want to be considered before others, you need to be ready for the times when your preparation (business acumen) meets with opportunity.”

Thus, carve out time in your schedule to learn as much as you can about your industry, and make conscious efforts to adapt your communication messaging and develop important relationships. There’s no time like the present to begin taking proactive steps to bring your own profes-sional career goals to fruition.

Eileen McCulloch is co-founder of the Network for Value Excellence at Arizona State University, W. P. Carey School of Business in Tempe, Arizona, and Nila LaVanaway Charles is director, strategic accounts at SciQuest Inc. in Morrisville, North Carolina.

Choosing the Right Medium for Your Message

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