Let’s be honest: Most of us who did not start our careers in finance would sooner stick a fork in our eye than to have to learn about finances. You’re an expert in your area of the business, so why bother? You likely wonder: If financials are my weakness, why not stick to developing my strengths?
“Your job performance is often measured by the financial impact you are driving,” says Valerie Conard, a senior director whose team sets pricing and promotional strategy for stuff you’ll find in Target’s home decor aisle. Conard explains why boosting your financial acumen is a solid career move: “Understanding the basics of financials, and using that knowledge to make good, informed business decisions can set you apart.”
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Corporate finance can seem daunting, especially if you don’t consider yourself a “numbers person.” But if you’re interested in expanding your scope of responsibility or adding more value through your work, you’ll need at least a basic understanding of how the financials work.
I spoke to Conard about the importance of moving beyond numerophobia (yes, it’s so common there’s a name for having a fear of numbers) to get a greater grasp of the financials that are relevant to your role. “Investors in your company expect a return and every decision you make has a financial impact,” she says. Think of this as a way to make better business decisions and focus your efforts where they matter most.
The good news is you can apply what you already know from your personal life to what you do at work. “You’re already managing your household budget, making sure you have enough income to cover all your expenses you’re generating,” says Conard. “Adopt an owner’s mindset.” This means asking yourself, “What would I do if I owned this business? How would I spend this money if it was my own?” If you’re capable of prioritizing major purchases, and keeping your credit card balance under control, then you’ve grasped a fundamental principle of corporate finances.
In practice, this can look like clarifying the financial priorities that come with your role, being proactive in understanding the financial results you deliver and using that knowledge to make any appropriate adjustments in your financial plan.
“Finances can seem scary,” acknowledges Conard, who coaches finance-averse colleagues to avoid making some common missteps. These include being hesitant to ask questions, not taking the time to understand key metrics, or making decisions in a vacuum without considering the financial ramifications.
Improving your financial intelligence
What is Conard’s advice to someone who finds finances daunting, but wants to advance her career? Here, she offers four quick tips for where to start:
• Learn which financial metrics are important in your role.
• Don’t know a term? Google it! Investopedia.com is a great source.
• Take a class–look into resources that your company offers.
• Listen to your company’s quarterly earnings calls.
Then reach out and ask questions of your financial partners at work. “Learn the basics,” recommends Conard. “Stretch, and be a little uncomfortable, but take baby steps.”
“Financials tell a story,” Conard says. The more you understand what they are trying to tell you, the more of an asset you’ll become to your company.