One concern we often hear from stakeholders of various businesses is that many of their staff don’t think ‘commercially’ enough. These people make decisions without thinking of the financial implications, pass-up opportunities to cut costs and lack the ‘commercial’ savviness’ for what makes a good ‘business’ decision.
So what does it take to be commercially savvy or astute?
You may ask, what does commercial savviness or commerciality consist of? How do we know who’s got it? And how do we develop it for the ones who lack in it?
Sound Commercial Acumen is the holy grail of every organization, but our experience tells us there is no single way to define it. For some, it might mean looking beyond the basic financial metrics, for others it’s about being able to objectively evaluate the business from the outside in, or making decisions that result from weighing up the cost versus the benefits of something.
Whatever the definition, organizations need to articulate what commercial acumen means to them and ensure their people are completely aligned with it.
We at Kaplan follow a 3-staged approach towards measuring commerciality. The first stage is defining the drivers - the core elements that shape a business’ attitude towards commercial decision making.
Kaplan Learning Diagnostics have identified a list of drivers which form the crux of commercial savviness. Some of them are as follows:
Ability to identify the value of a Growth Opportunity
Organizational Savviness implies understanding the business goals and strategies better and being aligned with them
Taking out cost to achieve savings and efficiencies
Market Savviness to help understand the market and economy
Financial Skills to help understand the financial data in relation to its implications on the business
Ability to manage change and turn it into a commercial advantage