The Essence of Business Acumen is Dilemma Resolution!
From over 30 years of working with companies across multiple sectors I believe is possible to identify 10 dilemmas in Business which fall into two main categories – Business Dilemmas and Leadership Dilemmas. However please don’t take this classification too rigidly - there will always be overlap between the two categories. Business Acumen Dilemmas (1-5) mostly concern the operation of the whole business unit. Leadership Dilemmas (6-10) mostly concern the operation of the executive team leading the business unit.
The 5 Business Acumen dilemmas will vary in detail depending on the type of business. For example, in a digital business the Supply-Demand Dilemma might be more about human resources than external suppliers. The 5 Leadership dilemmas, however, are more generic and more likely to arise in a similar form in any type of business.
The Customer Dilemma is primarily about how we decide which customers (or prospective customers) are most important at which times and how we might win their loyalty.
The Product Dilemma is essentially about how we optimize the contributions of our whole portfolio of product across their full lifetimes and how/when old products get retired and new products introduced.
The Price Dilemma concerns how we use pricing to optimize the ‘trinity’ of profit, demand, and market share in different market conditions and how we price to support products appropriate to their potential and maturities.
The Mix Dilemma is fundamentally about how we mix (i.e. optimize) the different options available to us in terms of products, markets and other factors (such as supply, geography and currency) to produce the best business results at the lowest business risk.
5. Supply & Demand
The Supply & Demand Dilemma is primarily about how we strike a balance between having too much supply of our product (or its components) and having too little to satisfy our customer’s demand and how we achieve this in the most profitable manner.
The Planning Dilemma is essentially about getting the right balance between developing comprehensive plans and mobilizing plans through conversations. It is also about how we avoid the artefacts of planning becoming ends in themselves.
The Results Dilemma concerns how we design and effectively monitor a balanced set of measures which keep our’ eyes on the prize’ while providing us with effective tracking and early warning systems.
The Health Dilemma is primarily about how we strike a balance between delivering the required results today while protecting and enhancing the ability of our organization to deliver the results it needs in the future.
The Agility Dilemma is about our ability to respond effectively to and learn from all types of unexpected change both minor and major. It is also about how we design systems to warn of, build resilience to and respond to future shocks, so that if they cannot be avoided or absorbed at least we can manage them with less pain.
The Team Dilemma is how we balance the tensions between being an effective, autonomous and motivating leader with being a supportive and loyal member of a senior team.
These 10 dilemmas are explored in more detail in the book “A Systematic Guide to Business Acumen and Leadership using Dilemmas: Includes Organizational Health, Agility, Resilience and Crisis Management”, published Feb 2016 by Ken Thompson.
Learning from Dilemmas in Safety
One of the best ways to explore dilemmas in using simulations as this provides a safe environment where mistakes can be made resulting in learning but not putting your business at risk.
XSIM is an in-depth team business acumen simulation involving running a national unit of a major global business in a highly competitive market. As the National leadership team you must also manage 4 major incidents over a full year trading.
COMPETE is a head-to-head competitive business acumen simulation playing against up to 5 other teams in real-time. COMPETE can be configured to represent almost any kind of business and a set of custom business decisions can be setup for each round.
We also have a number of Business Acumen simulations for the Automotive, Pharmaceutical, Cruise/Hospitality, Technology, Retail Fashion and Retail/Convenience Store sectors.