When you think of financial reporting and accounting presentations, data storytelling probably isn’t the first thing that comes to mind. Most finance professionals want to report the numbers, and then continue on with their work.
But what if the WHY behind the numbers was just as important as the numbers themselves? What if storytelling is not only something that makes sense to focus on, but is something that you ought to be paying a lot more attention to than you are right now?
On this episode of CFO Weekly, our guest is Liz Barhydt. Liz is the Chief Financial Officer at Directive, a performance marketing agency specifically serving SaaS companies, helping them be better marketers, drive growth, and generate better returns on their marketing dollars. We discussed the need for better storytelling when it comes to finance and accounting and the impact on finance departments across industries.
What is a Data Storyteller? - Data Storytelling
The entire concept of storytelling, especially when it comes to finance and accounting, can seem a bit muddled, or even silly, if we’re being honest. Shouldn’t we just report the numbers? That’s our job after all?
To put it simply though, storytelling is using stories to talk about the numbers or share financials. When you do this, you’re communicating data in a way that makes it incredibly easy for people to listen. And when it’s easy for people to listen to your data, they are much more likely to understand what you’re saying.
If people understand what you're saying, especially non-finance people, they’re far more likely to want to take action based on the numbers. So if the numbers are telling a story that requires structural change within the organization, utilizing good storytelling is a way to get everybody on board with the change.
Studies have shown that when you share numbers or data with people, they’re only likely to remember one out of every ten statistics they hear. But if you tell them a story, that retention rate goes up to nearly eighty percent.
Finding the Story Behind the Numbers
Finding a story behind the numbers is a skill, and one that takes some work and commitment to develop. So how do you go about combing through financial reports and finding a compelling story to tell? One that will drive cohesion and understanding?
First and foremost, being a good storyteller requires impeccable listening skills. Not just listening waiting for your turn to speak, but really listening. Getting out from behind the spreadsheets and having conversations and engaging with others in the organization that work in different functions.
It may seem uncomfortable at first, and truth be told, it probably will be. But it helps you get some more context and perspective on what's really going on behind the numbers.
The other thing that storytelling requires is the ability to ask questions. Honest, good, thoughtful questions. As you take in the numbers, ask yourself questions. What’s exciting about these numbers? What’s scary about them? What’s something that you can see looking at them that may not be widely obvious or visible to those outside of your function?
Look for the things that may not align with the company’s values, or that may be trending in a way that’s taking you further away from the goals that you’re trying to achieve. If you find things like that, it may be time to start crafting a good story to help people understand what’s happening.
Why Does Data Storytelling Matter in Accounting?
Beyond the examples we’ve already discussed, why is this such a big deal? If the people that make the decisions understand the numbers, why do we need to worry about analogies and framing numbers with stories?
Because to put it simply, it’s going to be required. With the rise of data automation and AI, the hard skills that we all learn in the early days of accounting aren’t going to cut it anymore. As technology grows and increases, it’s really the soft skills that are going to be required for you to continue to drive value and even communicate your worth and relevance.
It may not currently be expected of you, or required of you, but who knows how long it will stay that way. Storytelling is becoming more and more crucial.
What Can I Do to Communicate as a Storyteller in Accounting?
Knowing all of this, what can you do? What skills do you need to develop or hone in order to become a storyteller?
As we talked about already, listening. It’s all about listening and having those conversations with people. It’s important to be intentional when you hear a story, to take note, recognize it, and put it to use in the future.
One way to do that is to start a story vault. It can be in an app like Evernote or your phone’s Notes app, but some place that you can record stories when you hear one that resonates with you. Before long, you’ll have created a habit of listening and recognizing stories, as well as have a stash ready so that when a situation comes up that requires good storytelling, you’re ready to go.