It feels like just yesterday that I received my first lesson in ‘commercial nous’. That was 25 years ago.
At that time, I was a mechanic. The most valuable thing I learnt was not tightening bolts, changing oil, and replacing spark plugs.
It was how to look someone in the eye, shake their hand, break the ice, ease their mind … and gain a customer for life. Building on these I would often find myself saying “yes” to helping friends fix, detail, or customise their cars – mostly in exchange for something – like a beer, a pat on the back, or just goodwill. Goodwill. That goes a long way.
So, exceptional commercial acumen is executed through tactically using both technical skills and soft skills. To this day this lesson has impacted my life and work.
Individuals who understand the nuances of how business works can take advantage of this with huge rewards gained from seemingly small actions.
Consider what could be achieved for your team by turning the dial on ‘nous’ alone.
Commercial nous is essential to have, and the sooner you develop it, the better it is.
But what does it mean to have “commercial nous”? The Frog Blog did a deep dive into this question and came up with two interpretations:
1) Commercial nous means that a person is commercially minded and can translate their performance into tangible and demonstrable outcomes.
2) Commercial nous means that the person is aware of issues and current affairs influencing their industry.
The interpretations are not either/or.
Most managers mean both when they talk commercial nous, which is a skill that can be learnt and developed.
I want to emphasise the skill part because, too often, a lot of skills are misclassified as innate traits. However, there are very few innate traits. Most often, if someone seems to have an innate trait, it just means that they learned a skill before and are benefiting from the compounding impact of their early education.
When you delve behind the curtain and look at the life and experience of a person with commercial nous, you’ll find someone who was taught or learned, through experience, commercial nous. They might not have realised that’s what they were learning or picking up, but they recognised the importance and kept the lessons in mind. As a result, they gained the benefits of compounding advantages.
Think of something as simple as budgeting.
If you teach a five-year-old to budget, reinforcing the lessons as they grow older, you’ve already given that person a leg-up over the person who waits until leaving home to start budgeting. But even the person that started budgeting once they were living on their own has a leg-up on someone who only starts budgeting when heavily in debt and only doing so because they have to.
Compounding benefits of having commercial acumen
In this book, “Outlier: The Story of Success”, Malcolm Gladwell delved into the compounding benefits of early learning and advantage on the success story of people like Bill Gates and members of The Beatles, along with many sports stars, scientists and other businesspeople.
In almost all cases, it seems, when you peer behind the success of so-called “Outliers”, what you find is that they learn vital skills early. In turn, they gain compounding advantages from their early learning that helped them outpace their peers who did not learn either because of a lack of opportunity or interest.
Bill Gates, for example, had the privilege of access to a mainframe computer as an eighth-grader in 1968 because it was an investment his school’s Parents’ Association made. That meant that Bill Gates had access to a computer before just about anyone else in the world.
As a result, he had a considerable leg-up in the world of software development. Of course, his early advantage would mean nothing without his vision of “a computer on every desk and every home” that guided him in his business dealings. But we should not overlook the fact that his learning education in computing helped him realise his vision.
That said, it’s better late than never to acquire a new skill.
The longer you wait, the more compounding commercial advantage you lose.
A person who has commercial nous understands how markets work. Commercial nous can give insight into the trends or technology that are reshaping the market. Not to mention, identify how a company can tap into these trends to streamline performance, grow market share and outperform the competition.
For procurement, commercial nous can help professionals:
- make better judgements and quicker decisions regarding contracts.
- be more likely to achieve contractual goals quickly and with less effort, disputes and costs.
- reduce the likelihood of losing value through making elementary mistakes.
So, as the saying goes, “The best time to plant a tree was 20 years ago. The second-best time is now.” Make today the day you start learning and earning compounding advantage.
Consider what could be achieved by turning the dial up on nous alone.
Our recently upgraded commercial acumen short course builds nous – quickly. Boosting your acumen will impact on how you operate, interact and influence.
The course requires two half-days from you (1 full day) in a virtual online setting (no need to travel). It is delivered by one of Australia’s top Procurement deal makers and offers you acumen in spades!
It is perfect for those starting out in a commercial role. Equally, it can be used to inspire new thinking around commercial value.
This article was originally posted on comprara.com.au.