Jul 14, 2022
In General Discussions
Multiplied by hundreds or even Job Function Email List thousands of employees, this lack of understanding - the lack of true business acumen - means that too many decisions are Job Function Email List being made and too many actions are being taken that don't align with business objectives. How can training help bridge this knowledge gap? For many companies like Southwest, implementing learning programs designed to develop a strong foundation of Job Function Email List financial literacy and business acumen has made the communication of financial results to employees easier and more effective. Business Acumen: A Definition Very simply, business acumen is the understanding Job Function Email List of what it takes for a business Job Function Email List to make money. It involves financial literacy, which Job Function Email List is an understanding of the numbers on financial statements, as well as an understanding of the strategies, decisions and actions that impact these numbers. Someone with financial literacy, for example, would be able to "read" the Job Function Email List company's income statement. This employee or manager would understand the terminology (revenue, cost of goods sold, gross margin, profit, etc.) and what the numbers Job Function Email List represent (i.e., gross margin equals total sales/revenue less the cost of goods sold). With business acumen, the individual Job Function Email List would be able to "interpret" this same income statement, taking into consideration how company strategies and initiatives have impacted the numbers during specific periods of time. Consider a simple comparison: In football, Job Function Email List it's necessary for players to know how the game is scored as well as how to play the game to change the score. In business, financial literacy is understanding the "score" (financial statements) and business acumen is understanding how to impact it (strategic actions Job Function Email List and decisions). Asking the Right Questions When business acumen spreads through an organization, employees and managers begin to ask questions.