As a tech leader, investing in and developing financial acumen will help you become a more well-rounded leader, boost your ability to influence, and refine your judgment. Here are four tips on how to get started in building your financial acumen:
1️⃣ Learn the Basics: As with learning any new field starting with the basics is essential to demystify terminology and illuminate concepts you may already be hearing about regularly. There are countless resources online (books, courses, blogs, etc.) as well as structured educational programs (e.g. MBA) to learn from. Two of my favorite resources to get started are: Chapter 5 of The Personal MBA by Josh Kaufman, and Naked Economics by Charles Wheelan.
2️⃣ Review Earnings: Reading about quarterly earnings of public companies (start with the company you currently work in - as applicable - and branch out) is a great way to improve your financial acumen and develop economic mental models on the given company, industry and/or economy as a whole. To get familiar with the basics of an earnings report, read this resource: http://ow.ly/h6fZ50M0HuQ. An example of an earnings call transcript (Amazon, Q3’22) for reference: http://ow.ly/76kx50M0HuR.
3️⃣ Read: Set aside time to read about current financial and economic news. These help deepen understanding of market dynamics and influencing drivers. Some of my favorite publications in this space are the Wall Street Journal, Financial Times, Seeking Alpha, and The Motley Fool. Along similar lines, reading books about economics, finance, and investing is also relevant. One of my favorite books in this area is The Intelligent Investor by Benjamin Graham.
4️⃣ Follow: Following thought leaders and decision-makers in the space is another means to build financial acumen. Examples of decision-makers I follow are heads of Central Banks and International Monetary Fund (IMF). For thought leaders, I follow Mohamed El-Erian and Ray Dalio. Here is a link to a longer list of thought leaders (with a focus on economics): http://ow.ly/E9M850M0HuS.
👉 Any additional resources you recommend on this subject area?