Business Acumen Skills: Definition and Examples
Updated September 29, 2023
Many jobs require employees to have business acumen skills to exceed in their positions. Business acumen skills are skills that enable a person to understand and manage various business situations. This skillset is not limited to a single skill but rather incorporates several different skills to build a strong business acumen competency.
In this article, we explore what business acumen skills are, examples of these skills, how to improve them and use them in the workplace and how to highlight your business acumen skills on your resume, cover letter and in interviews.
What are business acumen skills?
Business acumen, sometimes referred to as business sense or business savvy, is a person's ability to understand various business scenarios and cope with them effectively. People with strong business acumen skills can better understand business issues, adapt and remain flexible during times of change, comprehend business operations and provide quality insight as to how to achieve goals and ensure business success.
In short, a person with strong business acumen skills who understands various aspects of a business and how it's run can make competent decisions based on this knowledge.
Business acumen skills are highly sought after by employers, especially when hiring individuals for leadership positions. As you prepare for an interview, have some examples ready so you can demonstrate your business acumen skills with real-life examples.
Examples of business acumen skills
The following are several examples of business acumen skills individuals can work on gaining and enhancing to help set them apart from other candidates during the job search:
Leadership and management skills are a component of business acumen and allow individuals to be better leaders within their organization. While these skills are certainly important for individuals in leadership positions, they are beneficial to any employee and something that employers actively look for in candidates. Strong leadership skills allow a person to inspire, motivate and build respect among employees and ensure they understand employee needs and work to meet those needs for a more cohesive and efficient work environment.
Common leadership skills that support a person's business acumen skills include:
Financial acumen refers to an individual's financial literacy and ability to understand processes related to reporting, budgeting, forecasting and other financial skills. People in leadership positions must understand what drives cash flow into and out of their organizations as well as how to maximize profit and minimize loss. Financial acumen refers to all aspects of a company's monetary transactions and economic value and allows leaders to understand better and manage financial indicators related to stakeholders, resources, goals and market success.
Good financial acumen skills needed by leaders and other employees include:
Financial report analysis skills
The ability to understand financial performance metrics
Budget preparation and implementation
Financial statement analysis tools
Strategic thinking is another key skill that falls under the business acumen skills umbrella. Strategic thinking refers to a person's ability to devise effective plans to deal with business situations and to create strategies to reach company goals. Good strategic thinking skills include prioritization skills, adaptability, flexibility and strategic action plan development.
People in leadership positions must have a strong understanding of the marketplace in the industry in which they work. Market orientation and market perspective refer to knowing who their ideal target audience is, what they need, where they spend their time and their buying patterns and power. It also means understanding who their competitors are and what their competitors have that their company doesn't. Market orientation allows individuals to make more effective decisions that ultimately draw customers in and increase the company's bottom line.
Analytical skills and analytical thinking are critical components of business acumen. Analytical skills refer to a person's ability to gather, collect and analyze data and form connections between various pieces of information. These skills also allow individuals to see problems or scenarios from different perspectives to better devise strategies to deal with these situations or issues. Analytical skills ultimately ensure a professional can solve complex problems through analytical thinking and strong decision-making skills.
Good analytical skills related to business acumen include:
Attention to detail
Individuals in leadership and managerial roles need to possess a comprehensive understanding of what impacts their organization's cash flow and profitability. Financial acumen refers to a person's ability to understand the financial effects of certain choices and actions and make informed decisions to maximize profits and decrease loss.
People with financial acumen understand bookkeeping, accounting, how to create and manage financial reports and cash flow management. Financial acumen can also help you understand if a certain cost or investment would be worth pursuing and how to find the right arguments to get it approved based on the benefits it would bring to the company.
Other financial acumen skills include:
Credit and debt management
Pricing strategy creation
Tax strategy creation
Many positions require individuals to possess at least some level of marketing skills. For those in leadership and managerial positions, these skills are especially important to support their overall business acumen. Marketing skills are a person's ability to analyze a target audience and define their needs and preferences, identify the most important features of a marketing campaign to attract customers and public speaking and writing skills to effectively communicate marketing strategies.
Good marketing skills that support strong business acumen include:
Public speaking skills
Critical thinking skills
Another important component of strong business acumen is problem-solving skills. These skills refer to a person's ability to handle unexpected or challenging situations in an effective way. Strong problem-solving skills allow individuals to determine the source of an issue and come to a viable solution. Employers value problem-solving skills in most all employees, and employees in any position can benefit from having strong problem-solving skills.
Examples of problem-solving skills that support business acumen include:
Active listening skills
Strong business acumen is also directly related to a person's ability to communicate effectively. You might have a great idea, but being able to pitch with confidence and clarity will increase your chances of a successful outcome.
Employees of all levels benefit from good communication skills and these skills enable employees to function more effectively in their positions. This helps to build trust in your relationship with a boss, colleagues and customers. A few of the most important skills in terms of business acumen include:
How to improve business acumen skills
The following are steps to take when working to improve your business acumen skills:
1. Get to know your company's business strategies
Understanding your organization's business model is essential for developing strong business acumen. Several components go into a business model, including how the supply chain operates, the supply chain's business cycle and how the company makes money and talent acquisition. The better you understand these business factors, the more you'll develop your business acumen and use it to improve your business decisions.
2. Understand the financial side of business
You don't need a background in finance to learn your way around the financial side of an organization. Ways to acquire knowledge on how finances affect a company include tracking key metrics and analyzing them to see how they impact the organization and acquiring knowledge from well-known business financial resources that are available online.
3. Invest in education
Education is a great way to enhance your business acumen. There are several online courses and certifications you can pursue to broaden your business acumen skills and become more effective in the workplace.
4. Find a mentor
Another way to improve your business acumen and business knowledge is to find and work with a mentor who is already established in your industry. Even if you cannot meet with them personally, you can still read their blog posts or follow them on social media to learn more about how they operate and the knowledge they possess.
5. Learn the right time to bring something up
Sometimes achieving a goal is about how and when you make a request. Over time, you will learn how to deal with a manager or a colleague. Do they prefer to be asked to perform a task during a 1:1 conversation or do they prefer emails?
If salary increases happen at a specific time of the year, wait until closer to this date to bring up the conversation. You can start preparing your arguments ahead of time, just wait for the best moment to voice them.
To increase the chances of a positive outcome, use your business acumen to bring up a topic when the other person's mind is more likely to open for it.
Business acumen skills in the workplace
Here are a few ways to use your business acumen skills in the workplace:
A great way to implement your business acumen skills at work and to better understand your company's customers is to perform both qualitative and quantitative research. Collecting insight from customers gives you a better understanding of market orientation and allows you to use your business acumen skills to meet these customers' needs successfully and profitably. Collecting data from customers, sending out customer surveys and speaking directly with customers are all great ways to perform customer research and gain valuable knowledge.
Listen to your customers or clients
Another important component of expressing business acumen is listening to your company's customers and implementing strategies to improve upon challenging areas brought up. The more you know about your customers, the better you'll be able to identify a successful way for your company to deliver products and services that attract clients. Listening to customers also improves other business acumen skills, including communication skills and marketing skills.
A great way to utilize your business acumen skills in the workplace is to stay up-to-date on the latest industry news and use this knowledge when making business decisions. Keep track of business news and research how other companies in your industry are responding to changes.
How to highlight business acumen skills
The following are ways to highlight your business acumen skills on your resume and cover letter as well as in job interviews:
On your resume and cover letter
There are a few key ways to highlight your business acumen skills on your resume. One way is to incorporate a skills section on your resume and include two of the five of the most relevant business acumen skills you possess as they relate to the job you're applying for. For example, if you're applying for a marketing manager role, you'd include leadership skills and marketing skills. You can also provide an example of how you've used each skill in this section.
You can also mention of your business acumen skills in your work history section. When writing your previous work duties, note the business acumen skills that helped you succeed in that position and a quantifiable example of how you used each.
On your cover letter, choose one or two business acumen skills that are relevant for the job you're applying for. Highlight these skills in the body of your cover letter by providing one or two examples of how you've used each successfully.
In a job interview
There are several business acumen skills you can demonstrate during a job interview. For example, you can demonstrate strong communication skills by communicating in a concise and easy-to-understand manner. You can also bring up any business acumen skills you feel are relevant to the job and give the interviewer a few details about how you've used these skills in the past to further your career success. Have these examples ready ahead of time so you can easily showcase them during the interview process.
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