A great example of financial acumen in action.

Financial acumen is different to financial knowledge.
Financial acumen goes further.
It uses financial information to gain insights which are not otherwise available.
Financial information is raw, cold data.
Financial acumen brings it to life!

Take Cost of Goods Sold as an example.
The financial information will tell you how much was spent on each component of COGS.
It will give you a total of COGS.
But, on its own, it’s just raw data.

Financial acumen takes it further.
For instance, compare COGS to Sales.
Calculate the percentage (COGS / Sales x 100)
Just say, it was 36%.
Now compare it to last year.
It was 33%.
A difference of 3%
What happened?
What caused this?
Why was there a change?
Different supplies?
Different suppliers?
More wastage?
Poor quality?
Different staff?
Poor pricing?
Discounting?
Or was the issue actually with last year’s figures?
We better find out!

As you can see, financial acumen looks at the data.
Looks for patterns. Compares.
Which can lead to enquiry.
Which can lead to better decisions.
Which can lead to better financial performance.

I encourage you to look deeply at your figures.
To enquire.
To ask questions, about why they are the way they are.
Or why they are not better, or worse, or what you thought they would be.

It is possible to immerse yourself in your numbers.
To look for trends. Patterns.
Seek to understand.
Then find ways to improve.

Let me know if you need a hand.

Peter