If you want to show value, you’ve gotta have business acumen
ASTD2012 is evolving nicely for me and certain themes are starting to form. My focus today is on the future value of Learning+Development people to the organisation. According to Kevin Cope “Business Acumen” is one of the big missing links in the skill set of many professionals… …that includes Learning+Development people. Once you understand the core drivers of any business, you can get to work on them, create and show your value.
There are 5 basic business drivers that your people ought to understand… ..and 5 basic business drivers you need to influence with Learning+Development.
Your oxygen supply, more important than your mother, the king of all business.
Is cash good? Yes? Is lots of cash good? No? How much cash should you have? Enough to cover expenses, Capex and a little more for a rainy-day…
What does this mean for L+D? How can we have an impact on the business cash situation?
- Increase retention – recruitment costs too much. Stop it.
- Pay slower and get paid faster
- Reduce costs
Lots or little, you’ve got to have profit. Not-for-profit organisations too. If you are making less then you are spending, you will not fulfil your mission. Simple.
To increase profit you can either increase your price or decrease your costs.
What does this mean for L+D? How can we have an impact on the business profit situation?
- Improve sales training
- Onboard faster
- Reduce costs
An asset is defined as anything you own that can be useful. You can measure your asset situation in terms asset “strength” and “utilisation”.
What L+D be doing to develop the asset situation? How can we have an impact on the asset situation?
- Reduce under-performing assets
- If you don’t need it, don’t order it
- Measure the output of your assets
Growth is commonly defined as an increase in your business performance. It’s important for 3 key reasons:
- Shareholders want it
- The desire for growth pushes people to innovate
- It attracts the best and brightest people
Why does L+D care about growth? How can we help drive growth?
- Develop good leaders and high-performers
- Get involved in culture-shaping and acquisition integration
- Anticipate workforce staffing – you need to understand the business
There are 2 types of people: Employees and customers. These are the people that will bring you all of the other 4 key business drivers (cash, profit, assets, growth)
What does the business-savvy L+D professional need to do on the subject people? Maybe you think
Regarding employees in the business that you need to develop:
- Create good leaders
- Build engagement of employees
- Help people understand the big-picture
Regarding your customers:
- Anticipate the future needs of your customers
- Assume your customers are not entirely satisfied. Get closer to them.
At the end of the session, things got interesting: HR people tend to focus on people; CEOs focus on growth and profit; Finance focuses on profit and cash. This is a problem.
Making a business case for your learning initiative? Focus on the right people. The ones who have to back it.
Show your business acumen!
Thanks for reading!