The Wall Street Journal recently convened chief financial officers from some of the world’s largest companies for a conference in Washington, D.C., and asked them to discuss the most-pressing issues their organizations face today. The results might surprise you. They certainly surprised us.
You can read the complete report here for context. The CFOs identified four areas as critical issues: development of talent, controlling corporate healthcare costs, preparing for global risks, managing energy and environmental issues, and tax policies.
While it’s a solid list — we particularly agree with the part about talent development — I have to tell you, I’m absolutely floored that a group of chief financial officers managed to miss the most critical issue of all: business acumen. Hello?
Business acumen is the very essence of doing business — understanding how a company makes money, what drives profitability, how the market influences cash flow, and how internal and external relationships affect success. A big part of it is financial literacy, but it’s more than that — it’s about having a death-grip understanding of how strategies and behaviors affect the bottom line and sustain growth.
Sadly, this critical skill is lacking in today’s workforce. A recent survey by the Institute for Corporate Productivity, in conjunction with HR.com, showed “a moderate to very high level of deficiency” of business acumen among employees at four out of five organizations nationwide.
Indeed, the Society for Human Resource Management last year identified business acumen as one of the nine contemporary HR competencies for gauging professional development.
At any organization, the people with business acumen are the ones who propel the business forward. They make strategic things happen. If today’s companies are doing so well that developing business acumen isn’t a critical issue for employees — as these CFOs apparently believe — then why is it that so many businesses are still limping through economic recovery? Just thinking out loud … I’d love to hear your thoughts.