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What is Business Acumen? Project Management in Under 5



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in this video I want to answer the

question what is business acumen

business acumen just means business

savvy it means knowing about business

the word acumen it means the ability to

make good decisions to exercise good

judgment so business acumen is the

ability to exercise good judgment in the

context of business or organizational

life so business acumen is it's an

awareness of how business works how

value is created and the heels are done

the risks and the opportunities that

arise in the business world people with

business acumen have a clear internal

model of how business works they

understand how businesses make money and

they understand in particular how their

business makes money they understand how

value chains work and therefore how

their suppliers and their customers and

their competitors make money this means

understanding a number of things who

your customers are and how your business

serves them your customers and your

clients and the income streams that this

generates you need to understand what is

your product or service set and the

business operating model that creates it

and how does the product development

lifecycle work to identify and deliver

new products and service solutions you

need to understand the value chain from

the creation of raw materials or

identifying new ideas through to the

production and sale and distribution of

your products and your services

and the stakeholders that have an

influence and who are affected at each

stage in that value chain you also need

to understand how your organization

works and the structures and the tiers

of the structures and how the politics

plays out between them you need to

understand your business's vision its

mission its strategy and the strategic

decisions it's making and the ways that

it makes those strategic decisions and

of course the financial implications of

the choices and the decisions your

business makes at the start of your

career as a project manager you probably

think like I did that you're nothing

more than a doer your job is to be given

a project and to make that project

happen to do the project management and

to deliver move the benefits from that

but increasingly as your career develops

and as you rise through the levels of

project management general management

and leadership you increasingly need to

gain business acumen to understand how

your business and business in general

works that way you can set your project

within the wider context of the

organization of the business that's

sponsoring it and crucially it means

that when you make project decisions or

when you frame decisions for the

governance tiers of your project to make

you can do so understanding that context

and therefore creating the framework for

better decision-making and it's not just

me that thinks like this the PMI the

project management institute the APM the

association for project management and

others all require that as you become an

experienced project practitioner you

understand the business context of your

projects the PMI for example has the

talent triangle and one of the sides of

the triangle is strategic and business

management PMI expects its senior

practitioners its PMPs project

management practitioners to carry out

continuing professional development to

earn PDUs or professional development

units and some of those need to be in

strategic and business management so

business acumen is a vital part of your

skill set as a professional project

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