Establishing a solid financial acumen in a company
Establishing a solid financial acumen in a company has several benefits. Financial acumen is the ability to understand an organisation’s growth influencers and systems, its cash flows, profitability and the overall organisation financial status. From a strategic perspective, financial acumen helps an organisation to make sound strategic financial decisions that positively impact the performance of the organisation. A solid financial acumen in an organisation means that people in the organisation are well informed on the financial matters and can be able to make comprehensive financial decisions.
It is essential to establish a solid financial acumen in an organisation because it helps the employees to clearly understand the financial objectives of the institution and adopt effective measures to achieve these objectives. A solid financial acumen in an organisation also ensures that the employees can be able to make better and viable decisions (Hynes, 2006). Wrong decisions can adversely affect the company, more so when such decisions are closely related to the company finances. Therefore, to avoid such eventualities, it is crucial to invest in establishing a solid financial acumen within an organisation.
A solid financial acumen in an organisation is essential since it influences the employees’ performance. Consequently, improved employee performance will also directly affect improved overall organisational performance. Knowledgeable employees on financial acuity can be able to make profitable decisions and effectively utilise resources within an organisation for optimal results. One of the main components of a solid financial acumen in an organisation is fiscal responsibility. By doing so, the organisation is inevitably destined for improved results; hence, a successful business.
Many companies have taken heed to ensure that there is a substantial financial acumen for better performance. For instance, Hannaford Bros Co., a supermarket retailer under the stewardship of Blythe McGarvie, initiated the training of its employees on financial acuity (McGarvie, 2007). McGarvie points out that the employees needed to acquire the necessary financial skills to enable them to make investment decisions for the company.