06 September 2022
What is commercial awareness?
Commercial awareness can be described as knowledge about the way a business works, the industry it operates in as well as the forces affecting its external environment, for instance economical, political and technological trends.
The foundation of commercial awareness is understanding both internal and external aspects of a company’s operation. The internal dimension includes the company’s strategy, core values, key activities and stakeholders, as well as understanding the role you are applying for and its significance to the company’s running. The external facet, on the other hand, relates to its competitors and the influence of macro environmental factors on the business functions, for example, the growth of the metaverse now offers an attractive opportunity for consumer goods companies to offer virtual products.
Why is commercial awareness important?
Commercial awareness is a transferable skill that most employers look for as it demonstrates genuine interest about the role and company. It’s also an opportunity for candidates to show critical-thinking and the ability to make informed decisions relevant to the company, a crucial aspect of any role and industry. Furthermore, this particular skill is related to proactivity, which can be an invaluable capability in multiple business functions, such as product development and it’s therefore considered a necessary, rather than supplementary, skill to showcase throughout the application process.
Employers will test the extent to which candidates are commercially-aware throughout the whole recruitment process, from questions in the application form, to interviews and assessment centres activities.
Common questions related to commercial awareness are:
- How will X (Brexit, Metaverse, Russian-Ukraine war) affect industry Y (financial services, energy, healthcare)?
- What are the current challenges and opportunities facing the industry?
- Tell us about a recent news story and how it impacts the firm?
- What are the organisation’s main competitors?
- What are the main forces shaping consumer behaviour in the industry?
How to develop commercial awareness
Research, research and research.
Reading and researching are the fundamentals in developing an adequate level of commercial awareness. The company’s website is a good starting point to acquire information such as its history, mission and culture, which will provide useful insight into its internal activities and functions. Additionally, annual reports are convenient sources of information on company performance, structure, as well as challenges and risks faced by the organisation. For those that want to go the extra mile, it’s worth applying business frameworks such as the SWOT (strengths, weaknesses, opportunities and threats) and the value proposition canvas, which will allow capturing full scope of the company’s functioning and position in the market.
Staying up-to-date on industry-related developments and international affairs can be achieved through reading news online, taking part in industry-relevant seminaries as well as listening to podcasts.
Examples of some of the best newspapers:
- The Financial Times
- The Times
- The Economist
- The Guardian
- The Wall Street Journal
- Business Insider
- The World Economic Forum - It’s not considered a newspaper, but features a range of useful articles across multiple subjects.
Examples of great podcasts resources:
- FT News Briefing
- Today, Explained
- World Business Report
- Today in Focus
- The Globalist
- TED Talks Daily
- Wake up to Money
“Hands-on” research
Another way to obtain valuable commercial understanding is to have practical experience in the industry. Insight days, internships, work placements and volunteering are some of the pathways in gaining work experience, allowing you to actively participate in the daily running of a company. You will also benefit from an enhanced CV and more confidence during interviews as you can have more real-life examples and applications for any business-related question. Having said that, commercial thinking is a transferable skill, which means recruiters will also value knowledge and experience coming from any part-time role you have pursued. Therefore, you shouldn’t be stressed or scared if you don’t have industry-related work experience, as long as you understand how to apply it to different scenarios, you will do well!
Networking
Whether online or in-person, networking can be a relevant instrument in improving commercial awareness. The most accessible approach to networking is growing your connections on LinkedIn, making sure you connect with the pertinent individuals in your field and industry. Engaging with posts and discussions, participating in seminars and establishing genuine connections will certainly boost your learning curve.
Conclusion
One of the key takeaways from this topic is that improving commercial awareness should be an ongoing process as the accelerating pace of change is bringing about new behaviours, business models and demands at unprecedented levels. The development of such skill is an essential aspect of obtaining a proactive, risk-taking and innovation-driven mindset, which are some of the most coveted qualities employers are looking for.
