A Four Step Plan…

Unlike some leadership skills that can be built over time, embedded as habits and then take less effort, commercial acumen is something we need to constantly work on.

To make good judgements, we need up-to-date insights, which means regular research. Here we break down commercial acumen into four areas, helping you consider the research required and the questions to be asking.

A few of our clients have the leadership capability “Watching the World” in their competency frameworks, and this is great language for describing one quarter of commercial acumen. Astute leaders are researching their industry and their customers’ industries, finding out what their competitors are doing, and what market commentators are forecasting. We have called it Market Insights here to clarify that this is about looking outside of your own business.

The second aspect of commercial acumen is to deeply investigate your own company and gain a deep level of Business Understanding. How does this business work? How does it make money? What is the process or supply chain – meaning the step-by-step journey through your business from a customer query to a bill paid, or from a product idea to a customer purchase.

How does your organisational structure all fit together? Who does what and where are the interdependencies? When we fully understand this, we can start to recognise where things are working well and where issues are arising. What are the levers that can be pulled on costs, sales and therefore profit?

When was the last time you carried out a SWOT analysis? It is easy to hear about age-old ideas like this one and dismiss it, but the simple SWOT analysis is anything but simple when we see the power of drawing together internal and external insights to identify priorities. Below is more detail, including questions to ask in each area:


This is about what the business is good at now.

What is working well?

What do customers love about this business?

Where are there strong results?

What is driving positive results?


This is about what the business is not good at now.

What is not working well?

What are the common customer complaints?

What is eating away at your profitability?

Where are there poor results?


This is about what the business could do in future, in order to do better.

You could translate the strengths and weaknesses above into opportunities, planning action to make even more of the strengths and address the weaknesses.

Based on your market insights, what could the business be doing to prepare itself for new customer needs or changing market conditions?

Based on your strengths, where is there opportunity to offer a new product or service? Many companies have recognised the power of selling their expertise on top of their products, for example, the Disney Institute sells their expertise in leadership.

What opportunities are there to improve sales, costs, departmental performance?


This is about things that could happen in future, which could damage the business.

Based on your market insights, what risks could the business face? Threats from competitors? Threats from disruptors (e.g. Blockbuster video were only looking out for other high street competitors, and missed the threat of the internet and video streaming services).

Based on your business analysis, what risks have you identified? This could be linked to the weaknesses above, or even to the strengths, where you have recognised that a strength is unstable. Common examples are related to talented individuals: so the business may have four high-performing accounts all reliant on that one account manager. What if they leave?

Finally and not surprisingly, you need to do something with all of this information. Choose the priorities, make decisions, plan action, set a vision for the company…

This is the Setting Direction part of commercial acumen. We have worked with a few leaders over the years who have been strong on research, using their network of clients, competitors and industry leaders to find out what is going on and perhaps even forecast market changes. Yet the move to action has been stalled.

Call it analysis paralysis if you will, or simply a gap in leadership skills. The most effective leaders either take their insights and translate these into decisions and plans, or of course, engage their teams to carry out that latter step.

Commercial acumen need not be an isolated job, and in fact there is harm to be caused by a lack of sharing. What if you know something that complements or contrasts with a colleague’s recent insights?

Sharing what you have learnt, encouraging the team to research as well, drawing together insights and asking, “what does this mean for us? What are the priorities? What shall we do?” is a great opportunity for engagement and empowerment.

So rather than working on your commercial acumen in isolation, why not share this article with your team and engage everyone in the journey?