Browsing the archives for the business acumen tag.

Importance of financial acumen

Business Acumen, Geek 5

One of the Geek 5 risks is that geeks often lack basic business and financial skills.  In school and early career, geeks often focus so intensely on their area of expertise that general business concepts get neglected.  If you are interested in moving from a technical role to a more general leadership role, you need to get savvy about business.

 For Geeks, gaining financial acumen is important for three reasons:

  1. Important understanding – Financial skills are more than a ticket to success.  The skill is important for a reason. The foundation of any business is the finances of the company.  Financial acumen will expand your understanding of the costs and challenges of doing business in your industry.You’ll gain a better understanding of how outside economic forces impact your company and how your company’s decisions impact your bottom line.  In many cases, this also directly impacts your personal bonus and compensation!
  2. Critical skill – As a leader, you will be called upon to make important and probably costly decisions for your company.  You need to know how to assess the best course of action.  For example, think of an IT Leader who needs to decide between a costly, gold-standard software package and a lower cost, lesser known package.  What does she choose?  How does she compare costs and assess short and long-term value?  How do you expense the package or is it a capitol expenditure?
  3. Credibility with senior leaders – As you rise in your career, financial skills becomes a ticket to play.  They are expected from all leaders at a certain level.  You need to talk the same talk as other leaders at your level and above.  You don’t need to turn into a Finance guru or get an MBA, but you should be able to contribute intelligently to a financial conversation and decision.

In the next post, I’ll point you to a website that can help you build your financial acumen.

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Business Acumen: Become a Financial Whiz!

Business Acumen, Geek 5

One of the Geek 5 risks is about lacking business acumen.   By definition, geeks have deep expertise in their fields.  Learning and developing deep expertise usually requires laser-like focus.   Engineers focus on math, science and technology; doctors focus on medicine; computer programmers focus on coding and systems, etc. 

As recent research has shown, it is believed to take approximately 10000 hours of practice to get good at something.  Geeks focus their 10000 hours (give or take) on their specialty.   As a result, most geeks don’t learn general business and financial skills.   

There are a lot of available resources to help geeks learn general business skills.  We’ll explore some of them in this blog.  Some of the resources are free and some cost to use.  The one common theme will be that you can learn from them on your own while you are working.  You don’t need to quit work and get an MBA to find success in your career. 

You already have a technical expertise that sets you apart.  What you need is to have enough business and financial acumen to understand the broader picture at your company.  You also need to understand the business issues facing your senior leaders and be able to discuss the issues.  To be a leader, even in your specialty area, you need to take a broader view of the business and financials of your company.

One resource to explore is Harvard Business Review (HBR).  HBR has many terrific resources – including articles, books, blogs and more.  I use HBR resources in many leadership programs and in executive coaching.  Recently I received an email about some new e-learning offerings from HBR.  I have not taken these course, but I trust content from HBR.  Sometimes HBRs web-based materials are not slick and flashy, but the content is always superior.

These e-learning courses cost $70-$130 for an individual license.  The topics include:

So if you are looking for some good business or financial course, check these out!

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Talented geeks without business savvy

Business Acumen, Geek 5

A recent blog post at BNET explored two situations in which talented geeks failed at a major business deals due to lack of business savvy.  This is a perfect illustration of one of the Geek 5 that we have not yet tackled.  The relevant Geek 5 is Business Acumen or rather the lack of it.

Geeks have generally spent their careers focused on their technical specialty – whether it be computers or medicine or statistics or psychology.  Specialized academic programs often do not allow for a lot of extra time to take management classes and such, so exposure to business often does not occur during the university days.  Once working, early careers are often built on technical expertise – again, no time or energy for general business and financial learning.

Once geeks leave the early career stage, business acumen starts to matter more.   As a matter of fact it can mean the difference between surviving and thriving or failing. 

Steve Tobak at BNET does a post mortem on two business cases in which talented people fail due to lack of business acumen.  The first explores the development of a video game, Duke Nukem Forever, which was an intended sequel to Duke Nukem.  However, the development team could not focus or stick to a timeline and plan.  After 12 years of development and a $20M investment, the project was shelved without being completed.

Another case study was on the chip maker Rambus.  They had a break-through technology DRAM chip.  However, they attemped to use an unusual approach to selling, got on the wrong side of some lawsuits and ended up behind the game.

The best technology does not always win.  Geeks need the right business acumen to protect their ideas and find success.

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Introduction to the Geek 5

Geek 5, Overview

In my experience in coaching geeks, I’ve seen five recurring themes.  Some or all of these might apply to you.  Many of my coaching suggestions will center on what I think of as the Geek 5.  If you are struggling to advance or to excel in a professional context, consider your standing on these five areas.

  1. Broader role – Geeks often prefer to stay in the cocoon of their technical specialty.  They resist giving up their expertise to move in to broader roles.  Sometimes they are pushed in a new direction and sometimes they pursue a new role to increase status and salary.  To be successful, a geek has to find peace with this decision.  In addition, geeks tend to have analytical work styles and introverted personalities.  These tendencies can make it less natural to focus on professional success strategies such as developing relationships, selling ideas and personal branding.
  2. Organizational savvy – Organizational savvy is about understanding how businesses or organizations work – and specifically how to get things done easily and effectively  in your workplace.  Some geeks refer to this as “playing politics” and cringe at the thought. “Politics” does not have to be a dirty word.  Organizational savvy is about understanding how to get things done, build networks, communicate effectively and protect yourself.  You’ve got to learn the rules of the game in order to win.
  3.  Managing people – Technical experts often make it to a mid-career point as well-paid individual contributors.  They are responsible for their own production, performance and success.  When they move into their first role managing other people, they are often missing basic knowledge around directing the work of others, delegating, communicating expectations, having performance conversations and developing their direct reports.  Managing people well is not an easy thing to learn – and it is not as clear-cut as technical knowledge.  A chemist who knows that two chemicals will always react the same way can struggle when two employees need completely different management styles. 
  4. Leadership skills – With a narrow technical focus, geeks are often not stretched into bigger leadership roles.  Leadership means setting a vision and clarity of intent for the organization or group, so everyone is moving in the same direction.  It involves building cross-functional relationships and always considering the systemic impact of decisions.  It involves strategy and motivating others.  It is often fuzzy to define, but yet remains critical to success.  Leadership skills are gained through experience and by learning from other leaders.
  5. Business acumen – Geeks who are not already in financial and business areas often lack basic business and financial fundamentals.  Moving into higher level roles or getting attention outside a technical area, requires geeks to think about bigger organizational issues.  This often involves an ability to understand and discuss financial metrics like EPS, EBIT, Margin, etc.  If you don’t know what these are, my point is made.  Go look them up.
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