The Importance of Business Acumen Training for Managers and Employees

Today's businesses need managers and employees with deep knowledge and ability to contribute to the financial success of their business. They need them to think and act like entrepreneurs. As a result, businesses have increasingly challenged financial services to provide financial literacy training. However, financial data focused solely on financial terminology and financial reporting is not enough. Instead, it's important to develop the business acumen of employees and go beyond financial literacy, to understand what it takes for a company to make money and how the impact of everyone's action on the financial situation.

Business sense: a definition Understanding business is a very simple understanding of how a business makes money. This is financial knowledge. It is a good understanding of the financial statements and the policies, decisions, and actions that affect these numbers. For example, someone with financial knowledge can "read" the company's income statement. This employee or manager would include basic financial terminology (sales, cost of sales, gross profit, profit, etc.) and numbers (gross margin is sales fewer costs to sales). Through professional insight, individuals would be able to "interpret" the same financial report and understand how their own actions, strategies and business initiatives affect the numbers. Consider a simple comparison: In a football match, players need to know the rules of how the score is calculated and how the game should be played in order to change the score. In business, financial literacy means an overview of the "score" (financial overviews) and an overview of how the company can influence it (actions and strategic decisions). The challenge for finances and staff The message to the finance and human resources directors is clear. Management would like the finance team to prepare reports that: Enable employees to make good business decisions Align employee actions with the strategic goals of the organization No employee wants to make a bad decision that affects the profitability of the company. Consider the person responsible for the maintenance of the tool room. He is very satisfied with their performance when the spare parts are in stock. It may not recognize the impact of excessive storage of spare parts on working capital or obsolescence issues. It is essential to educate this employee about the financial implications of inventory decisions and actions to align business activities. Once an organization has defined its strategic objectives, human resources and training must adapt their program. It means helping employees understand the objectives and developing the knowledge and skills required. At the most basic level of coordination, they must ensure that each employee understands how: The company makes money Money is generated and used to achieve goals Your daily actions and decisions affect the success of your business results Unfortunately, many managers and employees are not aware of the overall situation of their business. They focus on their own departments and functions. As a result, they can not associate their actions with the success of the business. This means that they make decisions and take actions that do not meet the company's goals. The introduction of Financial Education and Business Insight training has enabled many businesses around the world to fill this gap. Southwest Airlines: business acumen in its culture Consider Southwest Airlines. Founded in 1971, the airline is widely recognized for its motivational culture and dedication to customer service. Much of the industry has suffered from years of growth in the southwest. Many airlines merge or are declared bankrupt. The Southwest buys the same aircraft and the same jet fuel as the other airlines and pays its employees a salary and competitive public services. What is the difference PS: Click here to get Power & Business Acumen Plus 5 Mega Bonuses To Help You Create Your Mdpd Unlike some competitors, the South West management team involves employees in the company's bottom line. They explain the meaning of the numbers and, more importantly, link the decisions and actions of everyone involved in the end result. Airlines