It’s claimed that Churchill asked his advisors to distil the issues that he needed to consider in order to make a decision on to a single piece of paper. The reality for many of us is that we are often drowning in a sea of data. We yearn for reliable and trustworthy information and the tools to interpret and make strategic decisions from it.
The first part – getting the data – is easy. The second part is where many fall down.
Knowledge acquisition is just one part of commercial acumen
Have you ever read one of those articles that begins with the question: “What do you know now, that you wish you’d known at the start of your career?” The problem with questions like this is that the question assumes that it is the accumulation of knowledge that leads to informed decisions later in our careers.
Commercial Acumen: The Process
What if it is not what we know, but what we do with what we know?
What, so what and now what
Let’s illustrate this through an example using the three-part process:
- So what?
- Now what?
What? – Acquiring Knowledge
The ‘what?’ refers to identifying what is happening in a situation. Let’s say that you have a range of small and medium-sized companies in your portfolio of suppliers and you notice the following about a medium-sized supplier;
- The account manager you used to deal with has disappeared unexpectedly. Their Linked In profile reads “Looking for new opportunities”
- When you get in touch with head office there are new staff members who appear to be relatives of the business owner
- Performance has dipped, with KPIs not met and lead times lengthening
- Requests for a meeting with senior staff are left unanswered and the bosses are always “offsite” or “in a meeting”
- Accounts payable report that the firm is chasing payment of invoices that are not yet due
So what? – Interpreting information
‘So what?’ means interpreting:
- The possible causes of what is happening
- The possible consequences what is happening
In the example given earlier, we do not need to be Miss Marple to spot that these observations may not be significant individually, but collectively they suggest that the business is experiencing financial stress. The impact on you will depend upon the category and the exposure that you may have. If the supplier is your sole supplier the impact will be greater than if they are part of a panel solution.
Now what? – Making strategic decisions
‘Now what?’ means deciding what to do next.
Many organisations have a policy to support the use of small and medium sized suppliers. During the various lockdowns demanded by the pandemic, JobKeeper was responsible for helping some of these businesses stay alive. When JobKeeper ended, it’s possible that some of these suppliers experienced financial stress and may even have ceased trading.
Business acumen propels businesses, and individuals, forward
Developing and honing your business acumen can make an enormous difference to your career – at any stage. Whether you’re just starting out or you’re a seasoned professional with decades under your belt, it’s never too late (or too early) to learn how to use data to make well-informed, sound business decisions.
The quandary facing nearly every modern organisation is making sense of the sea of data they wade through every day. Be the person in the room with the business savvy to see the big picture. Nothing will skyrocket your personal stock more than demonstrating an ability to identify where the risks and opportunities lie, and the strategic path best taken for your company’s long term interests.
Commercial Acumen Course (August 17th & 18th 2022): 2 Day Virtual Workshop
The example used in this blog shows that the mere acquisition of knowledge (the five symptoms of financial stress) did not itself lead to better decisions. What matters is what you do with what you know.
Comprara Academy of Procurement’s upcoming course on Commercial Acumen is packed with examples like this, and seeks to help participants make sense of what is important.
The programs examines six dimensions that underpin better decision making:
Fast-paced, the four-session virtual short course uses multiple examples to bring to life re-usable tools, methods and principles to help you make sense of uncertainty and make better choices.
Book in to the upcoming program on August 17th & 18th and find out how to boost your commercial acumen.
It’s a unique, ‘must do’ course for commercial professionals dealing with contracts, negotiations, key relationships and who are ready to take their skill-set to a whole new level.