Introduction

Mention finance, and MBA students start looking around the room. It is too complicated, and too hard to understand. But there is a reason that finance is a required course in MBA programs.

 We make financial decisions all the time, in our personal lives:

• Given the differences in payment terms and interest rates, which credit card should I chose?
• Which bank has the best terms for a home mortgage?
• Am I saving enough for my retirement?

When you are through making financial decisions for you and your family, you can go to the office and make more decisions there:

• Should I lease or buy the new service truck?
• Is it time to expand the operation into more space?
• How much do I need to invest in training for my technicians?
• Can I afford to hire additional employees?

A sound understanding of basic financial principles can help you make better decisions. As you consider your business, you can look at three (3) general areas that require some financial acumen.