Commercial awareness is one of the key attributes cited by many employers as being essential to employability, but unfortunately one that many people seem unable to demonstrate. It comes up time and time again in job advertisements, discussions between recruiters and on careers guidance websites.
But what does ‘Commercial Awareness’ really mean, and how can you develop it?
Commercial awareness is the ability to understand what makes a business or organization successful, through either buying or selling products or supplying services to a market.
This simple definition, however, masks a wide range of skills and understanding. The first and probably most obvious area is an understanding of the business and its market or sector.
Ask yourself and research the following questions:
- Does the organization produce, sell, or buy products? Or is it in the services or ideas business?
- Who are its customers? Are they other businesses, or ‘ordinary people’?
- What’s going on in the market sector? Are there legal or regulatory changes on the way, or does the economic situation have a larger-than-usual impact?
The next part is understanding how you will fit in to the organization.
What job would you be able to do, and how will your unique skills and attributes help the company more than anyone else’s? In other words, what do you bring that the company needs to meet its goals?
Are you the sort of person the company needs, and will what you want to do fit into the company structure? More generally, for new graduates, and those who have not worked before, it’s helpful to demonstrate that you understand how organizations are structured, what a hierarchy looks like, and that you understand that you will start fairly close to the bottom of the heap!
There are a few other quite specific skills that it’s helpful to demonstrate to reassure potential employers that you are likely to be commercially aware.
First, an understanding that organizations are there to make money. You need to show some level of financial awareness: a demonstration that you always look for value for money in any purchase, for example, or that you have helped an organization achieve cost savings through improving efficiency.
You also need to show that you have some idea of moving a project forward from idea to implementation, even if it’s only on a very small scale, such as planning a party or outing for a group of friends. Our pages on Project Management and Project Planning may be helpful here.
Finally, it’s good if you can demonstrate that you’re reasonably numerate: an ability to understand a financial graph really helps.
Who Needs Commercial Awareness?
The short answer is almost everyone. It’s not just those working in business. With increasing levels of competition in the public sector and voluntary organizations, for both resources and to supply goods and services, even public and charitable sector organizations are looking for those who can show it, and demonstrate that they represent good value for money for their employers.
How to improve?
There are a number of things you can do to improve your commercial awareness:
- Read the business pages of newspapers and general interest economic magazines such as The Economist, readily available online. These will give you a good grounding in the general financial and economic situation in the world. If you’re looking for work in a particular sector, you should also read the specialist press for that sector.
- Think about what you’ve learned from any job or work experience that you’ve ever had. Think about the organization you worked in, and consider what you know about its customers, its sector and the broader environment in which it operates, its competitors and anything else you can think of about the way it operates and why it is successful or not. Reflect on what you think can be generalized, and what you think might be sector- or company-specific. See if that fits with other companies that you know about.
- Brush up on your basic skills, especially your numeracy and, if possible, statistics. There’s very little more embarrassing than being presented with a graph in an interview and wondering which way up it goes. And percentages. What exactly is a percentage increase?
- Take on voluntary roles that will help improve your commercial awareness. For example, does a local club need someone to take on a project? Does your children’s school PTA or similar group need a treasurer? Roles like this will increase your understanding of how organizations find or make money, and how they judge how well it is being used.
- Apart from these general ways to improve commercial awareness, you should also always research any company or organization to which you are applying, preferably before you fill in the application, but certainly before you attend an interview.
- The internet is a fantastic tool, and you should be able to find out about the structure of the organization, who is at the top and the shape of the Board, what the company does, who its customers are, what sector it operates in and any specific issues facing that sector or company. Don’t just look at the company’s website, although that’s important. Also look at news sites and discussion forums for mentions of any problems or issues.
(Adapted from: Skillsyouneed.com/general/commercial-awareness)