Developing your commercial awareness, by being aware

When attending an interview, one of the things you may be asked is a question around commercial awareness. Recruiters will want to know that you have a genuine interest in the commercial world and in particular they want to know that you are passionate about their business and the industry they work in. Demonstrating your knowledge and insights can be a daunting thing to do, but actually everyone (no matter their academic background), can do this.

Some of the questions you might be asked include:

  • How do you keep up to date with what is going on in our sector?
  • What challenges face our industry or business at this time?
  • What business story has interested you most recently?
  • Who are our competitors? What makes us different from them?

So how would you answer these?

If you are applying to a particular industry you should already be doing some research on the organisation you’re applying for. As you’re looking at their website, take some time to look at their recent news articles, their social media pages, even take a look at their Wikipedia page (although take that last one with a pinch of salt).

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5 minutes a day to develop your commercial awareness

finimizeMany employers are increasingly asking candidates interview questions pertaining to “commercial awareness.” They are designed to see if the candidate can demonstrate a general understanding of business acumen and how it relates to current events. For example, a candidate applying for a consulting firm would probably be expected to know some of the major “mergers and acquisitions” that have recently been announced (that AB InBev is buying SABMiller in a combination that creates the world’s biggest beer company, for example).

Firms strive to test this knowledge in candidates because clients are demanding their service providers – such as lawyers, accountants and consultants – have a deep understanding of their underlying businesses. In many respects, all professional services are becoming, essentially, advisors in their particular field. An accountant who just crunches the numbers isn’t good enough (an Excel spreadsheet can do that; or there’s probably “an app for that”). He or she must be able to strategically identify the client’s priorities and advise on specific actions – and in order to do so, that accountant must be able to understand the client’s business. So, professional services firms need to have graduates that are capable of understanding the basics of business. And knowing what’s going on in the business world is students can illustrate, at least, that they have some fundamental understanding.

So how can candidates demonstrate commercial awareness? The best way is to keep abreast of what’s going in the world of business. That can mean reading publications like the Financial Times and The Economist routinely; it can also include subscribing to a publication such as Finimize, which is a daily email that briefly summarises and explains the day’s main financial news stories. It’s important to develop an ongoing understanding of the business world: reading the FT on the morning of the interview isn’t going to cut it.

You don’t have to know everything, but you should know a few current topics in-depth (even just the key storyline and main issues) while also being familiar with general themes and financial terms. A little bit of steady reading on a day-to-day basis (even just 5 minutes) will go a long way to preparing your commercial awareness knowledge.

This is a guest blog post written by Scott Tindle, CFA. Former Vice-President at Barclays. Co-founder Finimize. To sign up for Finimize’s daily email, click here.

Commercial awareness: how do I show employers I have it?

What is commercial awareness?

Commercial awareness is sometimes also referred to as ‘business focus’, ‘client focus’, ‘business understanding’ or ‘passion for business’. Basically it is about having an interest in, and an understanding of, the business world that organisations operate in.

This includes:

  • familiarity with the company (its customers, competitors and suppliers)
  • knowing what is happening in the industry (and how this impacts the company)
  • an awareness of the importance of business issues such as efficiency, cost-effectiveness and client care
  • an awareness of broader economic and global issues such as the current economic climate
  • an ability to see the ‘bigger picture’ and appreciate  external challenges, pressures and opportunities

Why is it important to employers?

Organisations need graduates who can quickly understand the company and their customers, and be able to make good decisions on how best to develop their business. Students may have learned the theory at university, but need to be able to apply this in practice in the real world!

Recruiters will also want to know that you have a genuine interest in the commercial world and in particular they want to know that you are passionate about their business and the industry they work in.

How you do this will depend on the industry that you are applying to. If you want to get into finance then you should follow the financial news and know what is happening in the financial markets. If you want to get into healthcare or medicine then you should know about the changes taking place in the NHS. Interested in teaching? Then you must be aware of the current trends in education. Thinking about journalism, then you should know about the move to multi-format and web journalism… and so on for each industry…

How do employers look for your commercial awareness?

On an application form and at interview, the following type of questions are designed to test commercial awareness:

  • What do you know about this company?
  • What do you know about our competitors? What are the differences between them and us?
  • Who are our clients? What are our main products/services?
  • Tell me about a recent business story that took your interest?
  • What are the greatest challenges facing our sector in the next five years?
  • What changes have there been in our industry recently?

Business / Finance specific questions:

  • How do you keep up to date with what is going on in business?
  • What is the current Bank of England base rate?
  • How many euros would you get today in exchange for £10?
  • What is the FTSE 100? Did the FTSE go up or down yesterday?
  • What was our share price this morning?
  • If we were to open a new office abroad, which country would you choose and why?

At an assessment centre you could be given case studies or business scenarios, where you would be asked to analyse and make recommendations on how you would tackle particular business situations.

Employers would assess how you interpret data, consider risk and financial implications, offer creative solutions and make sensible recommendations. These exercises could be done individually or as part of a team (where they would also be looking at your team working skills).

How can I develop my commercial awareness?

The first step is to read the company’s website thoroughly. Check the ‘news’ and ‘about us’ pages, as well as the sections for clients, potential clients and staff. Review their annual report. Find out the size of the workforce, the turnover and profits of the company, its share price and key activities which interest you. Know who the organisation’s competitors are.

Keep up to date with business news. The business section of the major broadsheet newspapers should cover most of the information you need. The FT and the Economist will be essential if you are applying for a research/analysis role.

One student told me that she found it initially difficult to follow the FT.  So she would read a financial news story on the BBC website first to understand the background information, and then read the version in the FT to get more in-depth details.

Don’t leave this research until you get invited to interview. You could be asked a question about current affairs from 6 months to a year ago. Try building keeping up with the news into your weekly routine (this could be a good New Year’s Resolution!). Think about how what you read may directly (or indirectly) effect the organisations you are applying to.

Read specialist magazines and industry related blogs and follow relevant people on Twitter to keep up-to-date with developments in the relevant sector. An internet search such as ‘marketing industry blog for graduates’ is a good place to start, as once you have found one you like, it will often recommend or link to others that are useful. You can also ask people from the industry who you might meet at events / through online networking how they would suggest you build your industry knowledge (see our other blog posts about networking for tips on this).

Don’t underestimate your own work experience. You may have done part time retail work to earn some extra money, but this can also be used to gain an insight into business. What are the good and bad points about the business? Who is its target market? Who are its main competitors? How would you improve the company’s image or profitability?

Application forms – What recruiters look for

Be specific when answering application form questions such as “Why are you applying to us?”.  It is really important to avoid generic statements such as “you are a reputable firm, deal with top clients and offer excellent training prospects”. This can be said about a lot of companies, so is actually a poor response. Employers are looking for answers which show what it is about the business that stands out for you. Whatever your reasons are, they want to know why it is important to you.

Stand out from the crowd by giving clear evidence to demonstrate your transferable skills. For example by talking about some charity work you were involved in – helping people, raising money, working with people to achieve a goal – it shows useful skills important for a variety of careers.

In addition, what makes candidates stand out is not just studying hard and getting good grades, but also being committed to a number of additional interests.  This shows how you are a well-rounded person, who is likely to have gained a broad range of skills from a wide range of experiences.

Commercial Awareness is a common competency that recruiters look for. To perform well when answering questions relating to this on an application form, make sure you give an opinion as there is often no right or wrong answer. For example, they may ask questions like “what do you think is going to happen to interest rates in two years?” or “Do you think banks should be privatised?”.  Make your answer even stronger by talking about how the industry you are applying to fits in with this, e.g how law firms can help make sure this is being done correctly.  Reading  magazines for the industry you are interested in, such as ‘The Economist’, ‘Marketing Week’  or ‘The Lawyer’ etc, are useful to keep up to date with developments in the business area.

Work experience in the field you are interested in is vital. This does not have to be a formal internship or vacation scheme. Even a week in a local firm or some work shadowing is valuable, as it shows you have commitment and an understanding of the job.  If you have a part time job in retail, or a restaurant for example, use your existing contacts to see if you can gain some experience in the head office doing work experience within the finance / marketing / sales etc department.  Working for a charity in one of their business functions is another way of building experience.

Communication is key. When reading your written communication employers are impressed by writing which is to the point and articulate. It is  important it is to maintain a professional image in ALL communications with the company,  as text speak or lower case ‘i’s’ in an email about your interview date for example can really destroy your image with them.

The Ultimate Careers Guide

Whether you’re looking to boost your CV with an internship, find a part-time job during your studies, develop work-related skills or identify your dream career, The Ultimate Careers Guide is here to help.

Written by the staff at Careers departments across the University of London, the guide is piled high with tips and advice, including: Effec_Effective networking-page-001

  • 10 ways to get experience – and get ahead
  • How to develop your commercial awareness
  • Consider your options
  • Is further study right for you?
  • Create the ideal CV
  • Impress at interview
  • All about assessment centres
  • Effective networking
  • Starting your business

And so much more!

So come into the Careers & Enterprise Centre and pick up your copy!

Commercial Awareness in Law

This post on Law Careers.net recently caught my eye. As the article explains:

‘Commercial awareness is one of the key skills that law firms look for in future trainees and thus, if you are to succeed, you will need to develop this particular area of your brain’.

It even gives you some tips on newspapers to read, TV shows to watch and radio channels to listen to, to help improve your commercial awareness.

Impress with your Commercial Awareness!

This post first appeared on the Careers in the City blog.

While the world’s attention is focused on Greece, it may be worth taking a moment to acknowledge a startling economic shift in the fortunes of Spain – which recently posted a 2.6% growth rate for this year.

In this piece we look at how you might use this information to talk about an economic story that has interested you – if prompted to do so in an interview setting. This is a technique used in some interviews for financial roles, where evidence for wider economic knowledge is sought by the interviewer. It’s a technique I’ve used myself when interviewing people for roles on trading floors in the City of London.

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So how can you talk about this?

The first thing to do, is to impress by knowing about this – you can pick this information up from Bloomberg.com, the FT and many other journals and newspapers besides.

So you might say something along the lines of…

“Spain has certainly been performing well recently – its 2.6% growth rate is set against a backdrop of its main stock index rising 100% between 2012 and 2015, and joblessness falling a startling 2.7% in April – aided by reforms to labour market law.

The sustainability of this rise can best be assessed by looking at economic data. The construction and retail sectors have driven much of the growth. However, there is little evidence that strong rises in the construction sector are based on the need for new buildings – since occupancy rates are at an all-time low. Instead, it appears as though the money now being engineered in Europe via quantitative easing, is flowing into projects that may ultimately prove a drag on the economy – more empty buildings cannot positively impact GDP over the long term – but provide only a short term boost. The data therefore prompts questions as to the sustainability of the remarkable growth rates we’re seeing in Spain.”

If a candidate were to provide this level of detail about a story that has interested them, it would be deeply impressive!