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July 9th, 2020

ELEVATE PERSPECTIVE

Presenting Financial Data to Non-Financial Audiences

Barbara Uggen-Davis, CPA, CMA, Chief Financial Officer

In my experience, nothing loses a non-financial audience faster than a spreadsheet in PowerPoint. Spreadsheets are often hard to read on the screen, particularly when scaled to fit. Complex spreadsheets can cause information overload. Your audience’s attention may be drawn to the screen instead of engaged with you. This can result in presentations getting off track if someone focuses on irrelevant data points that don’t pertain to the core message. So, how do you share financial information without a litany of numbers?

In 1927, Frederick Barnard said, “one picture is worth ten thousand words.”[1] The often-paraphrased quote has become a modern proverb because of its basic truth. Our brains process images 60,000 times faster than text and 90% of the information our brain receives is visual.[2] Research has also shown that presentations that contain visual aids are 43% more persuasive.[3]

Focus on the Message

Regardless of why you are presenting financial data, it must support your message. Start by identifying key takeaways you want to convey and focus on data that communicates your message.

Once you identify critical information relevant to your audience, determine the primary drivers that contribute to the numbers. For example, if it is a sales forecast, identify what factors cause the forecast to trend upward (or downward). Is it investment in marketing, sales headcount, or market conditions? If you know both the outcome and primary financial drivers, you can build a compelling narrative using the relevant information your audience needs to understand.

Charts and Graphs

After you have defined your message, determine which visual representations best tell your story. Microsoft Excel has a wide array of data visualization tools. Here are just some examples.

  • Line charts are good for showing trends.
  • Pie charts are great for revealing the magnitude of individual line items as a percentage of the total.
  • Bar charts are good for showing comparisons
  • A stacked column over time can replace both line and pie charts and show trends and percentage of contribution.
  • Combination graphs are good for displaying relationship trends between disparate data measured on different scales, such as revenue and sales headcount.
  • Callouts placed on graphical data can be used to explain outliers that skew data and answer audience questions before they are asked.

Financial Dashboards

Financial dashboards present a large volume of financial data as visual images that are easy to read and comprehend. Take the time to really understand what Key Performance Indicators (KPIs) your audience needs to know and design a dashboard that represents these KPIs at a glance. There are financial dashboard tools available, so research which dashboards best fit your organization’s needs.

Narrative

After developing your visuals, review the narrative. Can you describe the data without excessive financial jargon and acronyms? Knowing your audience and their relative financial acumen will help you tailor how you phrase your message so that no one is left out or sidetracks your presentation with off-topic questions.

Be concise, clear, and stay on-topic. Don’t lose the message in the minutia. At the same time, make sure you know the details behind the numbers and be prepared to defend and explain. Include the spreadsheet in an appendix so you can refer to it, if needed. When presenting to a diverse audience, you may find one individual wants to dig deeper. Assess the audience’s interest in the deep dive. If the rest of your audience is suddenly checking their phone, you have lost their focus. Offer to take the question offline and work with the individual after the meeting.

There may be times when a question is one for which you have not prepared and can’t readily answer without research. Don’t be afraid to tell your audience that you will get back to them. Take their contact information and provide a response in a reasonable time. If you are prepared for the most predictable questions, audiences will generally accept that some questions may take more time to research. It is better to evaluate the question and respond accurately than to make guesses. If you must make a ballpark estimate, do so, but follow through with the research and response.

Above all, be transparent. Don’t gloss over or try to hide negative data. Understand it, address it, explain it, and have a plan to remedy it. Brevity is no excuse to lack transparency. Confronting uncomfortable truths can be challenging, but your audience will appreciate candid and open communication.

Conclusion

Always remember the purpose of presenting financial data is to facilitate decision making. Understand your audience’s financial acumen and need for financial information and arm them with data relevant to the decisions that need to be made. Don’t lose track of important information by focusing on too much data. Make it easy for your audience by using visual tools and a strong narrative. Know your numbers and be prepared to defend your data. Don’t be afraid to table a question that requires research or is off-topic, but always follow through with a response. Be transparent and confront the negative information head-on.

If you make financial data easy to understand and deliver information efficiently, you will turn the dreaded financial presentation into an opportunity to drive the business forward.

[1] ON LANGUAGE; Worth a Thousand words, William Safire, April7, 1996, The New York Times Magazine https://www.nytimes.com/1996/04/07/magazine/on-language-worth-a-thousand-words.html

[2] Humans Process Visual Data Better, September 15, 2014, Thermopylae Sciences + Technology, http://www.t-sciences.com/news/humans-process-visual-data-better

[3] MISCR-WP-86-11, Persuasion and the Role of Visual Presentation Support: The UM/3M Study, June 1986, D.R. Vodel, G.W. Dickson, and J.A. Lehman, Management Information Systems Research Center, School of Management, University of Minnesota. http://misrc.umn.edu/workingpapers/fullpapers/1986/8611.pdf

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