The nature of higher studies or any specialized degree particularly Technical ones is such that they are more focused on the core subject, which is definitely right to some extent. But ones a Technical professional steps out into the corporate life, they are not supposed to deal which only technical part. With time when they are stepping up on managerial positions, they should be aware of all dimensions of business like Finance, Accounts, Sales and marketing etc. Since a manger has to take decision concerning all these aspects and to have some vital information related to these and getting your concepts clear in advance is a really smart move. Here are the few concepts related to finance you must grasp early in your career:
1. Company’s Income Sheet and Balance Sheet are one of the very vital documents and depict the financial health of company. Income Statement in detail gives you the information like from what all Sources Company is generating revenue and things where all company is spending money. Balance Sheet which measures company’s Assets against its Liabilities at the end of Financial Year. You should really need to understand how to study them and anticipate their implications.
2. Key Financial Industry Ratios is another concept you should get right as these are most common topic of discussion in board rooms to assess company’s financial health to compare it against its competitors. Its helps you in taking decision where you are over spending and where you are doing it less.
3. With time your position and job role may ask you to prepare IT budget which not only will check your knowledge about your technical know how, but majorly it will check how you can adjust that know How within a given financial budget. Thus in a major way it will be checking you on your Financial Knowledge applicability related to Technical aspects.
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4. Company Revenue and Cost Streams is another thing you must be a master of, you definitely should be able to answer questions like if revenue is increasing and vice versa then why? If cost are increasing and vice versa then why? You should be able to identify the reasons behind same and come out with solutions to rectify same.
5. Understanding Company’s financial performance can be your starting step even when you are getting to understand complicated financial terms of company. Being part of IT department of your Organization you can try and check how well assets and people are utilized? How can you better utilize your assets? How can the cost be cut down? Checking all these things routinely will make sure you will be capable in viewing things from financial perspective as well apart from core technical knowledge.