Business acumen is an understanding of how an organization makes and uses money strategically. Employees with business acumen understand how they individually contribute to their company’s bottom line and use that knowledge to make good business decisions. It’s important for employees across the organization, but especially for training leaders, since they must be able to translate L&D programs into business impact.
There are several important areas of business in which L&D professionals must develop competency, including financial literacy, business strategy, marketing and leadership skills.
Financial Literacy
Financial literacy includes an understanding of an organization’s financial metrics, including the ability to read income statements, balance sheets and cash flow statements. It’s important for training professionals to understand finance in order to be able to manage training budgets and translate training results into return on investment (ROI). There are a variety of resources, both websites and books, that L&D professionals can use to develop financial literacy, but it’s also important not to overlook colleagues in the finance department who can help explain financial metrics in the context of the organization.
Business Strategy
Strategic alignment is the most important competency for training managers, and the ability to align training programs with business objectives is key to success. In order to do this activity, however, training professionals need to be able to understand business strategy. When training managers understand their organizations’ strategy – and how it was developed – they can strategically determine where there are skills gaps and how they will fill them.
Marketing
Marketing skills are no longer restricted to marketing departments. L&D organizations must be able to effectively market their programs to employees in order for them to have any impact. Taking a page from the marketing playbook, training managers are increasingly understanding that they need to focus on their audience – whether it’s the learners themselves or the executives who must buy into a new training program – in order to increase learning engagement.
Leadership
Training professionals develop and implement leadership training programs for their organizations – but do they ever participate in them? Just like managers and leaders in other departments, training leaders must have the required skills to manage and lead programs and people. These skills include communication, teamwork and team-building, problem-solving, conflict resolution, and coaching skills.
Here are some tips for L&D professionals to develop business acumen:
- Be a student of your organization. Read its press releases, financial statements and annual reports. Listen to earnings calls, and ask questions of experts at your company.
- Follow business news. Read, watch and listen to news about other businesses. Stay up-to-date on current events, and ask yourself how they relate to your industry, your company and your job.
- Have a mentor. Find a role model in your organization, and ask him or her to be your mentor. Meet regularly, and ask questions.
- Join professional associations. Networking and attending educational events are great ways to build your understanding of your role and your industry.
- Join project teams. Develop cross-functional skills by volunteering for project teams.
- Participate in training. This should be a no-brainer for training professionals, but seek opportunities to develop your own skills, whether it’s through social and informal means or formal programs. Identify areas where you need improvement, and develop a learning plan for yourself.
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