I recently attended a training session called Business Acumen. A good amount of the course's material was dedicated to understanding financial statements (the company providing the training was affiliated with the National Association of State Boards of Accountancy.) The rest of the course's material was based on the book, What the CEO wants you to know: Using business acumen to understand how your company really works, written by Ram Charan.
The main point of the book was that all businesses, regardless of their industry have the same underlying principles.
- Cash - Money and near-money equivalents used to fund a company's operations.
- Margin - The amount of money left over after paying off expenses (for a product.)
- Growth - The rate at which a company's business expands.
- Velocity - The rate at which a company's assets can be used to make money. For example, inventory turnover is a measure of velocity in some industries.
- Customer - Consumers or potential consumers of your products and services.
- Increase the market for its products (especially if it did not have a web presence.)
- Increase the growth rate for the business by increasing the potential sales opportunities.