A long-term business success requires more than just a great product or service. It takes a keen understanding of the intricate workings of the corporate world, and that's where people often talk bout business acumen. You may be an aspiring entrepreneur. You may be a seasoned business professional. But we're all looking to elevate our careers and hopefully a continuous, sustainable growth. So business acumen...What's it all about?
What is Business Acumen?
Business acumen is just a fancy way of saying 'business smarts'. It's about understanding how a business works, makes money and grows. It’s like being good at reading a map - you can see the whole picture, figure out the best route, and avoid any roadblocks.
If you are sensible enough and don't want to be one of those embarrassing talk-the-talk freaks, you never wish to mention this stupid phrase.
Why Do They Call It Business Acumen?
Well, 'acumen' is just a posh word for being able to make quick, smart decisions. So, 'business acumen' means you’re really good at making those smart decisions in the world of business.
Why is this important?
Imagine you're the captain of a ship. You need to know how to steer, where to go, and what to do if there’s a storm. Business is like that ship, and you're the captain. You need to know how everything works, from sales to marketing, finance, and operations.
Here’s a simple breakdown:
- Understanding the Business: Knowing how different parts of a business work together. Like how making a product, selling it, and managing money all connect.
- Analyzing Information: Being able to look at information, like sales numbers or customer reviews, and figure out what it means and what to do about it.
- Making Decisions: Based on the information you have, you need to make decisions. Like, should you make more of a product? Should you spend more on advertising?
- Thinking About the Future: Always thinking ahead. Imagine what will happen in 3 months, 6 months, 12 months time if you go ahead with the decision you make today.
So, when you put all these things together, you get 'business acumen'. It's about understanding the whole picture, making smart decisions, and planning for the future.
How to develop business acumen
Think of it like getting good at a sport. You’d better know about the game as much as you can so you become a better player in the field. Then, how can you get better at understanding business?
#1 Get Curious
Being curious means being like a detective. You see a clue, and you want to know more about it. Let's say you see a business that's doing really well. What's their secret?
Be a Detective
Think of a company you really like.
- What makes them so great?
- Is it because they have really cool stuff?
- Or maybe because they're always so nice when you have a question?
Start thinking about all the reasons why you like them, and you’ll start to understand why they’re successful.
Ask All the Questions
- Don’t stop there! Keep asking questions.
- Why do people love their products? What attracts them?
- How do they let people know about their stuff?
- How do they price their things?
- Do they have a lot of competition?
You know that the more questions you ask, the more you'll understand about what makes a business tick, but you also don't want to annoy people by asking anything obvious. You'd better digest what they say. Don't do a "machine gun talk."
Learn from the Best
When you start asking questions and finding answers, you'll start to see patterns. You'll notice that successful businesses often do similar things. Pay attention to that! It's like a recipe for success that you can use in your own life or business.
Don’t Stop!
The world of business is always changing. New companies pop up, old ones change, and sometimes businesses even disappear. So keep asking questions, keep being curious. You may not even know how to begin to ask, but you’ll be better at it as you keep trying.
#2 Listen and Learn
Learning about business doesn't have to be boring or hard. There are so many fun resources out there that can help you understand business better.
Fun Learning is the Best Learning
Think about it. Are you more likely to remember something from a boring textbook or from a fun podcast or video? Probably the second one, right? So, find content that you enjoy. Whether it's a YouTube channel that explains business concepts with cartoons or a podcast that interviews successful entrepreneurs, find something that makes you excited to learn.
Bite-Sized is Best
You don't have to learn everything all at once. Break it down into smaller, more manageable pieces. Instead of trying to learn everything about marketing in one day, maybe start with understanding what makes a good advertisement. Then, the next day, learn about how to reach more people with your ads.
Mix It Up
Don’t just stick to one type of content. Mix it up! Listen to podcasts while you’re doing chores, watch YouTube videos during your lunch break, and read articles before bed. Fun kinds of content like gamified sites can help you understand topics better and keep things interesting.
Practice What You Learn
Try to use what you learn in your everyday life. If you learn about how to make a good advertisement, try making one for fun! If you learn about how to manage money, try creating a budget for yourself.
#3 Stay Up to Date
Keeping up with the latest happenings in the business world is a bit like following your favorite sports team or a TV series. Things change all the time, and you have to keep up to know what's going on.
Keep an Eye on the News
Newspapers, online articles, and news apps are great ways to see what's happening. Which companies are making headlines? Is it for good reasons or bad? Paying attention to these details will help you understand the bigger picture of what's going on in the business world.
New Kids on the Block
New companies pop up all the time. Some make a big splash, and others fizzle out. Pay attention to what the successful new companies are doing. What makes them stand out?
So you can think of something similar to what they do but by adding your unique selling point to it.
Bye Bye Business
Sometimes, older companies close down or aren't doing as well.
- Why is that? Maybe they're not adopting new technologies?
- A bunch of old people refusing to accept a new team of members?
- Did they not keep up with the trends?
- Did a new company offer something better?
Understanding why some businesses don’t succeed can be just as helpful as understanding why others do.
Spot the Trends
As you keep up with the news, you'll start to notice trends. Maybe a lot of new companies are focusing on eco-friendly products, or maybe there's a trend in online shopping. Keeping an eye on these trends can give you a good idea of where the business world is heading.
Make it a Habit
Try to make it a habit to check the business news regularly. Maybe over your morning coffee or during your lunch break. The more often you do it, the easier it will be to spot trends and understand what’s going on.
Stay Open-Minded
Remember, the business world is always changing. Especially in terms of online businesses, something that worked well last year may already be seen as an outdated strategy.
So stay open to new ideas and be ready to change your thinking as you learn more.
#4 Play Around with Money
No, I don't mean waste it! I mean, understand how money works in a business. How do companies earn it? How do they spend it? You can even create a pretend business and think about how you would spend money to make it successful.
Even playing money-based games like Monopoly can help you understand basic concepts.
Money Makes the World Go 'Round
Money is the heartbeat of any business. A business needs money to start, to grow, and to keep going. Understanding how money flows in and out of a business is super important if you want to get good at understanding business.
Show Me the Money!
First, think about how businesses make money. Let’s say you have a pretend business selling cupcakes. You make money by selling cupcakes to people, right? Easy peasy.
But what about a music streaming service? They might make money from subscriptions, ads, or even selling merchandise. There are lots of ways to make money, and it can be fun to think about all the different possibilities.
Spend Money to Make Money
Next, think about how businesses spend money. Back to your cupcake business. You have to buy ingredients, pay for a place to bake, maybe even hire someone to help you. All these things cost money. And don’t forget about advertising so people know about your amazing cupcakes! Understanding all the different ways a business needs to spend money is super important.
Make Believe
Creating a pretend business is a fun way to understand how money works. Think about what you want to sell, how much it will cost to make, and how much you can sell it for. Then think about all the other costs, like advertising or hiring employees. Playing around with these numbers can help you get a feel for how money flows in and out of a business.
Game On
Playing games like Monopoly can also help you understand money and business. In Monopoly, you have to make decisions about when to spend money and when to save it, just like in real business. Plus, it’s fun!
Practice
The more you play around with money, whether it’s in a pretend business, a game, or even just thinking about how your favorite businesses make and spend money, the more you’ll understand.
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#5 Talk to People
Yes, human interaction! Talking to people is one of the best ways to learn about anything, and business is no different.
A Friendly Chat
You probably know someone who works in a company or maybe even runs their own. Next time you meet them, ask about their work. People usually enjoy sharing about their work life, and you can pick up some great insights just by having a friendly conversation.
Be Inquisitive
Don’t be afraid to ask questions.
- How do they spend a day? Is there a typical routine, or is every day totally different for them?
- What parts of their job do they really like?
- What are some of the tough parts?
The answers to these questions can give you a glimpse into the workings of their business.
Keep it Relaxed
This doesn’t have to be a formal thing. You can ask these questions while grabbing a coffee, taking a walk, or just hanging out. The goal is to have a relaxed, friendly conversation.
Be a Good Listener
Make sure to look them in the eyes and listen to what they are trying to tell you. Sometimes, the most valuable insights come from the small details in someone’s story.
Show Gratitude
Always express your thanks to the person for sharing their experiences with you. Because after all, you gotta leave a good, polite impression to them.
The More, The Merrier
Try to have these conversations with different people. Each person’s experience and perspective can offer new insights and broaden your understanding of the business world.
#6 Think Like a Customer
Thinking like a customer is a super fun and useful way to understand business better.
Put on Your Customer Hat
Every time you buy something, take a moment to think about why you picked that particular item. Was it because it was the least expensive? Did it have the coolest packaging? Or maybe it had the best reviews?
Flip the Script
Now, switch gears and think about it from the other side. If you were the one selling that product, what could you do to make sure people would choose it? Would you lower the price? Change the packaging? Improve the product?
Be Observant
Pay attention to the things that catch your eye when you’re shopping. Is it the bright colors? The funny ad? The special offer? These are all clues to what makes a product attractive to customers.
Play Pretend
Imagine you are the owner of a store. What would you put in the window? How would you arrange the products? What kind of special offers would you have? Playing pretend can help you think creatively about how to attract customers.
Practice Makes Perfect
The more you practice thinking like a customer, the better you’ll get at understanding what makes people choose one product over another.
So, next time you buy something, take a moment to think about why you chose it and what you would do if you were the one selling it. It’s a fun way to practice thinking about business and to understand what makes people tick. Happy shopping!
#7 Try It Out
The best way to learn is by doing. If you have an idea for a business, why not start a small project on the side? It doesn't have to be big. It could be as simple as selling handmade crafts. You'll learn a ton just from trying to make it work.
Give It a Go
Learning by doing is one of the best ways to understand something new. If you have a cool business idea, why not start a small project? Just don’t make a big deal. For example, you could start selling crafts that you made yourself. You’ll learn so much just by trying to make it happen.
Start Small
Your project doesn’t have to be huge. It could be as simple as selling cookies to your neighbors or making custom t-shirts for your friends. The goal is to learn, not to start a huge business right away.
Learn As You Go
As you work on your project, you’ll probably run into some challenges. Maybe you’ll discover that people don’t want to buy cookies, but they love your brownies. Or maybe you’ll find out that making t-shirts takes longer than you thought. It’s all part of the learning process.
Have Fun
Don’t forget to enjoy the process! Starting a small project should be fun, not stressful. If you’re not enjoying it, maybe it’s not the right project for you. And that’s okay! You can always try something else.
Reflect
Once you’ve finished your project, take some time to think about what went well and what didn’t. What did you learn? What would you do differently next time?
What Do You Advocate?
Are you willing to share what you love? Show your creativity and earn rewards. Websites, AI tools, community & coaching.
#8 Learn from Mistakes
You're going to mess up and that's okay. Each mistake is a lesson. Did your side business project flop? Think about what went wrong and how you can do better next time.
Oops! That's Okay!
Mistakes happen to all of us, and that’s totally fine. Each mistake is an opportunity to learn something new. Did your side project not go as planned? Don’t regret it, but just take some time to think about what you can improve.
Be Kind to Yourself
Don’t be too hard on yourself. Mistakes are a normal part of learning. If you’re not making mistakes, you’re probably not trying anything new!
Be a Detective
Try to figure out what went wrong. Was it the price? The product? The way you marketed it? Once you know what the issue was, you can come up with a plan to fix it.
Try Again
Just because it didn’t work out the first time, doesn’t mean it won’t ever work. Use what you’ve learned to make changes and give it another go.
Share Your Experience
Talking to others about your experience can be really helpful. Maybe they’ve had similar experiences and can offer some advice. Or maybe they’ll see something you didn’t and offer a fresh perspective.
