How Product Managers Can Build Business Acumen and Grow Their Influence
In this post, I'll share why business acumen matters, the common gaps, and how you can practically build this skill as a Product Manager.
Over the last few years, I’ve run dozens of coaching workshops with product teams across different tech industries through The Insights Driven PM. In one of our key exercises - the Metrics One Pager - we map product initiatives to key metrics like activation or retention. The idea of this exercise was initially to help product leaders articulate their current product initiatives in context of their key product metrics.
But every time, we hit the same roadblock when filling out this one pager: product leaders develop a good idea which customer metric they were impacting, but couldn’t articulate how their work connects to actual business outcomes. Because of that, their work or role often didn’t get appreciated, or even deprioritised in favor of initiatives that had clearer “return on investment”.
I found the reasons for this can often be quite nuanced: sometimes, it’s due to a fundamental gap in knowledge of how the business is currently doing, and where it’s heading. Sometimes, it’s because the business goals have not been shared with the teams clearly. Sometimes, it’s because certain initiatives are important but really hard to exactly tie to specific numbers, and we get stuck trying to do the impossible maths. Or sometimes, it’s because the initiatives are simply not a good investment in the first place.
Whichever the challenge, with investments and budgets being more conservative and business profitability more in focus than ever, we’re finally putting the large spotlight on business acumen in product management it deserves. And as a long time advocate for business savvy product managers, I’m here for it!
Common Reasons Product Managers Lack Business Acumen
My personal take from my experiences is that the lack of business acumen in product management has come from one of these three things, or a combination of all:
Organisational structure: in many companies, product leaders have shifted too far into pure execution functions, and are far removed from business metrics. Product roles have increasingly been brought in to purely run agile delivery teams, which is very far removed from the original notion of a much more generalist, commercial, strategic product leader. Product Managers often tell me that “commercials are not part of their department”, which sit mainly with finance, sales or marketing. If and whenever those financial metrics and goals are shared with them, no one wants to ask the “silly questions”.
Lack of confidence: especially when purely focused on execution for a long time, product leaders often feel intimidated by business jargon, believing they lack the financial or “business” skills to understand the numbers and strategy. It’s the same phenomena I’ve seen for many years why product managers shied away from using analytical tools, due to a fear of not being “an analytical data person”.
Too much in the weeds: lastly, others can fall into the trap of over-measuring and attempt to draw direct lines between every single minor product change and its financial results, even though in reality dozens of people and different functions have contributed to any given change. In the end, they lose sight of the big picture and get trapped in endless debates over impact and prioritisation against other functions in the organisation.
The truth is, you don’t need a finance degree or rush to do an MBA to understand business strategy as a product leader. And you certainly don’t need to waste time playing the detailed attribution game - trying to prove the calculations of how every single little feature change led to a huge increase in revenue.
I believe what really matters is business curiosity: asking the fundamental questions, understanding the broader business context and learning how to connect the dots between your work and the company’s strategic goals. How does money come in? What are our biggest costs? What else really matters to the company? How are we currently doing, and what is our focus going forward?
Breaking Down Business Context
At its core, every company that works for profit operates with the same fundamental principles and at any given time, has one or probably both of these goals:
Make more money (grow revenue)
Spend less money (reduce cost)
The important thing to understand here is: where does the business think the increased revenue will come from, and where are the biggest opportunities to reduce costs?
Usually, these two goals come with some sort of assumption or plan - for example the company may believe (or in other words: place its bets) that revenue growth will come from doubling down or expanding certain offerings or customer segments. This could be geographical expansions, focus on specific product lines or types of customers.
The same goes for cost reduction: the company may not be happy about last year’s customer acquisition costs and places big focus on streamlining acquiring new customers, or decide to consolidate or sunset certain offerings. Both of those will drive up the overarching goal of profitability.
Now as a product leader, you don’t need to analyze every line in the financial statement to understand this. But what you do need to understand is the big picture, the big levers that bring in money and cost money to the business. This also means having a sense of where your company currently is, what challenges it faces, where it’s headed, and then figuring out how your work contributes to its overall success.
How Product Leaders Can Quickly Unpack Business Goals
One of the best ways to start is by looking at annual company or investor reports (if the company is public), or internal quarterly or yearly company updates. These sources should give you a sentiment on where the company is and outline what the company is prioritising for the next year - whether that’s expanding into new markets, improving customer acquisition efficiency, or reducing other operational costs.
Let’s go through an example from the accounting software Xero. If you read their FY25 H1 Investor Briefing, you can draw out some fundamental themes. I personally don’t typically jump into the financial slides, but rather start with scan reading sections that mention:
“performance summary”, “summary of results” or similar to understand the current state, and
sections that mention “strategic themes”, “key priorities” or similar to understand the focus going forward.
What we can draw from Xero’s example, as an absolute outsider, at a glance:
1. Revenue Growth Goal: the company is aiming to grow at a certain rate (“rule of 40”, a widely used financial metric meaning a growth rate of 40% or more)
2. Customer Segments: they aim to grow revenue by focusing on three core markets: the UK, Australia, and the US
3. Reducing Costs: one of their strategic goals is also “A Winning GTM Playbook” - a good assumption to make here is that it’s important to the business to drive customer growth in more efficient ways, or in other words to reduce costs to acquire new customers. This is in line with mentions of their growing customer acquisition costs in other sections of the report, and a general focus on this industry wide.
Now scrolling two pages further down, we can also see that:
4. Product Lines: they aim to grow revenue by focusing on 3 key product lines - accounting, payroll, and payments
This is something we can start to work with. Even without deep financial analysis, product leaders can grasp the company’s top level goals and strategic focus in a fairly short amount of time by reading these reports, in order to connect their work accordingly.
These top level themes can be derived from reading their summaries and their strategy on a page, without having to analyse the financial statements line by line. The key part is to get started.
Now that you have that context, you can start crafting a narrative that connects your work to those business priorities. The trick is: don’t overdo it.
Why Chasing Perfect Attribution Is a Waste of Time
One of the biggest mistakes I see product teams make when trying to build more business acumen is to try to precisely calculate how much revenue a single feature or UI change contributes. The reality is that business growth comes from multiple touchpoints - marketing, brand awareness, paid acquisition, sales conversations, customer support, onboarding, and of course the product experience itself.
If a customer signs up for your product today, it’s not just because of a new onboarding flow. It’s because they saw an ad two months ago, read a blog post last week, talked to a colleague who recommended it, and then finally made the decision to give the free trial a go, and then they ultimately made the purchasing decision.
This means direct attribution is nearly impossible in most cases. And even if you have the data, chasing perfect attribution is often a waste of time. Instead, the smarter approach is to focus on directional impact and alignment with business goals. I recommend a read of Kyle Ponar’s article on how to unify your Go To Market metrics if you want to learn more about how to do attribution, but better.
How To Tell A Strong Business Narrative
Now that you have the business context, how do you communicate the value of your work? To truly build your influence and be seen as a strategic, business savvy product leader, you have to learn how to connect the dots and craft a narrative.
You’ve done the hard work now of getting the broader context of what matters to your business right now. The final part is now that every time you talk to a stakeholder, whether it’s an executive, marketing leader, or sales team, you need to be able to explain how your work ties back to the company’s priorities.
For example, let’s say you’re working on improving the onboarding experience.
Instead of saying:
“We’re redesigning the onboarding flow to make it more user-friendly.”
Frame it like this:
“We’re working to increase sign up conversion by 5%. I saw our company goal for this year is to reduce customer acquisition costs and ‘win at acquisition’ - this initiative plays a key role in improving our customer experience AND making our growth more cost efficient.”
Sharing your work this way does three things:
Gets stakeholder buy in: Executives and decision makers care about the business impact. When they see that your work is aligned with company priorities, they’re more likely to support and invest in your initiatives.
Sharpens your business acumen: The more you engage with company reports and strategic priorities, the more fluent you become in speaking the “business language”. Over time, you’ll naturally start thinking in terms of company wide impact, rather than just feature releases.
Motivates your team: at the end of the day, we all want to have an impact in everything we do. It’s easy to feel disconnected when you’re deep in the weeds, tweaking a UI flow or optimising a backend process. But when you can articulate how even small changes contribute to larger business goals, your team will feel more engaged and motivated.
How Business Acumen Will Boost Your Product Career
Beyond helping your company, learning to connect your work to business goals and “speak the business language” is one of the most powerful things you can do for your own career growth. Too often I see product managers acting solely on user feedback, without considering the business context. With this approach, you’ll be seen as a more strategic thinker, who thinks on business not just execution level. As Marty Cagan likes to say - our job as product leaders is to “solve hard problems in ways our customers love, yet work for our business”.
The more you develop this skill, the more you’ll be seen as a strategic leader - someone who not only understands product but also understands how product drives business success. Some of the best Product Managers I’ve hired into my teams over the years were the ones who had a side hustle or ran a business before, no matter how big or small. They were not necessarily finance or commercial experts, but they learnt which questions to ask about the business, and consider the broader context at all times.
Final Thoughts: How To Build Your Business Acumen in Practice
The next time you’re in a meeting with stakeholders trying to get buy in for a new product initiative or share the impact of your work - try this exercise:
Before presenting your work, take a step back. What is the company focused on this year? What are the strategic goals? I personally always find it helpful to do a refresh by re-scanning the annual reports before those meetings.
Frame your initiative in that context. Think of creating a simple narrative - instead of just describing what you’re building, explain why it matters in the bigger picture.
Tie it back to impact. Remember it doesn’t have to be a complicated calculation of trying to attribute a change to specific numbers (in fact we established that can be a rabbit hole to go down) - we're looking for a clear logic and narrative that connects your work to business outcomes. The simpler the better.
So, next time you roll out a feature update, don’t just talk about what’s changing - connect the dots, tell a story why it matters. If you make this a habit, you’ll find that not only will stakeholders better understand your work, but your influence and credibility as a product leader will grow exponentially. Pick one initiative you're working on right now: how would you explain its business impact in 2–3 sentences?
Want to master product & business metrics?
We run online workshops for product teams at Fortune 500 companies and startups to help product leaders align their metrics and speak the business language. Or, we offer self learning resources, including the Metrics One Pager, if that’s more your thing:
📈 #1 Amazon New Release book The Insights Driven Product Manager
📈 Our self paced video course Master Product &Busines Metrics