Like blood that flows through our human bodies to keep us alive, cash flows through a business to keep it alive. Cash Flow and having cash to run continued operations is one of the most important parts of the business. Managing cash flow is one of the most critical skills within the business acumen portfolio.

As I continue my life’s journey of helping our client organizations build their business acumen skills, it has become more apparent than ever that we have a lot of work to do in this area.

Most of our learners “get” the Income Statement and Balance Sheet pretty easily. The Cash Flow Statement is a different story. The Cash Flow Statement, which helps us understand the sources and usages of cash from an operations perspective, investing perspective and financing perspective can be challenging because of its complexities and nuances. However, without a foundational understanding of how it works, senior leaders down to first-time supervisors can make huge, game-changing mistakes.

To help provide some insight and clarity, I am borrowing some of our very own business acumen content to share some ideas and information about the criticality of cash flow.

One of the biggest projects we are working on in July is a new business simulation that helps companies implement their sustainability strategies. As I was designing the new curriculum, I came across a concept I wasn’t very familiar with: “The Circular Economy.”

A circular economy is an economic system focused on eliminating waste and the continual use of resources. One of the best-known examples of the circular economy is recycling plastic. Instead of throwing away bottles, packaging, and other plastic products after use, they can be collected and processed to convert them into raw materials to manufacture new products, such as clothes, furniture, and even other packaging.

From a business perspective, the circular economy contrasts with a traditional linear economy, which has a “take, make, dispose” model of production. The circular economy employs principles of designing out waste, keeping products and materials in use, and regenerating natural systems for the long-term of the planet.

As I further researched the topic for the simulation, I discovered a set of principles that support a circular economy. Pretty interesting stuff and certainly blog-worthy:

When I speak with senior-level business leaders and listen to their biggest challenges, one of the most common sources of frustration they share is that their organizations have lost the art of prioritization.

“It’s not that people aren’t trying, but when I look at the things people in my company are working on, it seems like deciding where to order pizza from on Pizza Friday is more important than the consistent complaints of a key customer account about the communications about their delivery dates…I don’t understand where their priorities are” was the quote from one leader I spoke to recently about a business leadership simulation project.

In a hybrid business environment where many times you are working with people who are remote, they are motivated by getting things done, but not necessarily done right because they don’t have the context and there is not always a good conversation about prioritization.

Prioritizing effectively in a business environment is crucial for productivity and achieving strategic goals. But it’s not happening.

I will be the first one to own it and say that I didn’t think it could be done. That it was impossible to develop a comprehensive set of business acumen skills in less than 40 hours of work in a 5-day in-person program.

Well, times have changed and while it still may take up to 40 hours to develop good foundational business acumen skills you can accomplish a lot in a well-designed 90-minute workshop.

Ultimately, to master the concepts of business acumen, there are about 100 lessons to learn. However, after a lot of careful thought and many years of experience designing, developing, and delivering impactful business acumen learning journeys, it has been proven that you can prioritize the most critical elements of business acumen in a shorter workshop.

Over the past year, Advantexe has had the privilege of working on several unique assessment simulation projects helping our clients reach new levels of effectiveness and efficiencies in their talent assessment processes. During the past long weekend, I took a moment to reflect on some of the key learnings to share with subscribers of this blog as there are some interesting insights that can be gained and used by our various business audiences.

What is a Digital Assessment Simulation?

A digital assessment simulation is an interactive and immersive case study that comes to life. These digital leadership and business simulation assessments are used across various industries for training, development, recruitment, evaluation, and succession purposes. They replicate real-world scenarios to evaluate and improve the skills and competencies of individuals and functions within business organizations.