Perth Leadership Institute formally defines business acumen as "the behavioral propensity to create capital". This definition is based on psychometric research into business acumen by Dr. E. Ted Prince. Our informal definition is "the ability to create positive financial outcomes". It is also defined colloquially as “a nose for profit."
Ram Charan defines business acumen as “linking an insightful assessment of the external business landscape with the keen awareness of how money can be made — and then executing the strategy to deliver the desired results.” (Strategy and Business, February 28, 2006)
The only book about business acumen that sets out a formal structure for business acumen and shows how it is measured: Prince, E. Ted, The Three Financial Styles of Very Successful Leaders: Strategic Approaches to Identifying the Growth Drivers of Every Company, McGraw Hill, 2005.
See the review of E. Ted Prince's path-breaking book on business acumen "The 3 Financial Styles of Very Successful Leaders", Harvard Business Review, Working Knowledge for Business leaders Section, Nov 7,2005. The book shows how to identify and measure business acumen scientifically using psychometric instruments.
Also E. Ted Prince's seminal article on business acumen in CEOs "The Fiscal Behavior of CEOs", MIT Sloan Management Review, Fall 2005, pp. 23-26.
E. Ted Prince's "Building Better Business Acumen", Chief Learning Officer, July 25, 2010.
How to link personality with business outcomes and business acumen: Prince, E. Ted, Business Personality and Leadership Success: How to Use the Leadership Cockpit to Improve Your Career and Company Outcome, Amazon Kindle, 2011
Perth Leadership Institute
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