Storytelling in Finance: a Compelling Skill to Master

Matthew Dziak

Honing Your Financial Storytelling Skill

“We can’t wait to dive into the gripping tale of metrics,” is probably not something you hear as a finance professional when sharing your insights. Fair enough, for some finances and company performance, might not be the most riveting material to consume like a new streaming show. However, this only reinforces the burden on finance to deliver storylines that resonate. 

Storytelling is an often-overlooked soft skill and trait of CFOs, financial planning and analysis managers and other finance professionals, but compelling storytelling is a necessary skill that is often portrayed by CEOs. To be impactful, finance leaders must learn to be great storytellers and effectively communicate to business partners, management teams and each diverse member of the board. 

If you are presenting live or on a web call, you don't want to be flamboyant, boisterous or overly comical. Simply put, the points you wish to make should resonate with your audiences, since the numbers alone aren’t always clear or sufficient. However, you can fall back on accurate and pleasant visualizations, paired with brief summations, to tell the Company story without saying a word or being present in a meeting. 

This is where your robust reports and easy-to-consume charts, graphs, and analysis come into play. Including items like revenue trend charts, comparative income and expenses specific to top vendors or customers provide a tremendous amount of insight to supplement strategic conversations.

You Must Engage Your Audience

Regardless of who you are presenting to, be sure to infuse metrics with relatable analogies and storylines that drive home the message the metrics tell. For example, the best companies learn from their mistakes, while doubling down on their successes, to reach the most desirable business outcomes. Referencing a tactical shift in a customer acquisition approach and reallocating resources to fulfill the new opportunity,  can be likened to a football, basketball or soccer team making halftime adjustments based on the results of the first half. 

As attention spans dwindle, and numbers and charts seem more and more repetitive, it’s imperative to keep your audience engaged, so when you have a chance to speak directly to management or board members, you must be prepared to appeal to all of them (or at least the majority). 

Relying on real-life analogies that expand beyond the board room and everyday business operations can be a breath of fresh air to maintain attention spans and drive home your most significant updates. Your management team and board members are everyday people, so relating to and making connections on a personal level can leave a lasting impression.

Present Your Analysis - Focus on a Narrative 

Storytelling is an art form not taught at universities or business schools, but the skills are utilized in speech and debate, mock trial and other extracurricular activities. You may have picked up a few tips from those groups, like being sufficient, with well-thought-out and deliberate delivery. For the rest, think about your favorite grade school novel. What was it about the story that had you flipping to the next page with anticipation?

You don’t have to be eloquent like Shakespeare or riveting like Stephen King, but you want to spend some time honing a narrative that highlights the most important aspects of your analysis first and builds off of it. Try to establish a foundation for your high-level analysis that other details will speak to. 

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Consider the hierarchy of descriptive, predictive and prescriptive analytics. These approaches are necessary to inform, educate and provide context through your storytelling that is necessary to facilitate optimal strategic decision making. 

Descriptive Analytics: 

  • Summarizes data and metrics
  • Relies on manual processes
  • Tends to lack actionable insight

Predictive Analytics: 

  • Identifies events that might occur
  • Identifies KPIs and metrics and predicts them in the future based on historical trends
  • Tends to focus on singular metrics and trends in isolation

Prescriptive Analytics: 

  • Suggests ways to optimize the course of events
  • Incorporates multiple data points and analytical insight
  • Produces actionable insights designed to improve projected trends or outcomes

Another aspect of analysis is examining variance between actuals, budgets and forecasts. The most important aspect of variance analysis is to identify and explain why the variance occurred and how the business can adjust course to stay on target. Remember, to always keep it simple and digestible, because the stakeholders you share your analysis with come from a variety of backgrounds and range of skill sets. 

Infuse Presentations With Insightful Charts

When visualizing your analysis or preparing a board pack, there are a few key considerations to best communicate your results.  Be certain your metrics are reliable and accurate because when the numbers don't work, eventually nobody will. Whether its management, business partners or your board and investors, consider the following tips for data visualization:

  1. Select the appropriate chart type - One common practice is to use stacked bar charts instead of pie charts. When comparing the slices in a pie chart, it’s difficult to interpret the percentage differences compared to that of a bar chart where each bar is equal width and the height adjustment is easily seen on a single section of the chart. 
  2. Add a splash of color - Color, when used appropriately helps emphasize the results and relationship between certain metrics. You don’t have to be a designer or have advanced knowledge of color palettes, but you should use color to make your metrics stand out. Comparison or combo charts for example, should have contrasting colors for each graph type, so a bar chart might be a dark blue, and a line chart would be yellow. 
  3. Structure layouts and presentation - Charts should be free of clutter, Include a title, legends that reference the associated result, and x and y-axis labels with even spacing between levels. When including charts in presentation decks, only add one or two charts to a slide, so they are large enough to interpret. Avoid too much text on a slide, instead include a brief sentence giving context to the metrics or a few bullet points. 

Remember, it is your responsibility to spend the time conducting and delivering insightful analysis. Therefore, your results should be easily digestible, and takeaways quickly understood without confusion. It's difficult to present compelling analysis if you are having trouble wrangling and processing your data. Leveraging tools like FutureView’s FP&A Software to automate management reports and board pack metrics, so you can focus on analysis and presenting your findings in the most compelling fashion. 

FP&A Software - FutureView Systems