CFOs Get User-friendly: Three Creative Ways to Present Information
Posted by Mark Baars
As CFO, you have exclusive access to the most critical information in your business. Your financial analysis can mean the difference between smart choices that build company profits and unwise decisions that send organizations deeply into debt. However, to be effective, you must clearly communicate relevant information to stakeholders in a way that is easily understood, whether they have a background in finance or not.
The following suggestions increase engagement and comprehension during presentations that would otherwise be unintelligible to the average layperson.
Replace Acronyms and Jargon With Metaphors
When presenting to an audience with limited finance experience, stay away from acronyms and jargon. Even terms that are relatively common, such as EBITDA and free cash flow, can prompt your listeners to tune out. Remember, for some, the world of finance is like a different country, and you are speaking an unfamiliar language. Even if they are capable of translating, it doesn't come naturally, so those drifting between listening with interest and daydreaming may be unwilling to put in the effort required to interpret the information and appreciate your point.
Instead, illustrate the information using listener-friendly metaphors tailored to your audience. For example, when explaining the difference between EBITDA and net income, draw a parallel to household expenses or to gross and net income on paychecks. Most listeners can easily relate to these concepts.
Replace Numbers With Graphs
Those outside the Finance department are quickly overwhelmed by long lists of numbers. They are unable to take useful information away from your presentation because they cannot decipher the meaning behind the figures. Dramatically increase the effectiveness of your presentation by making interpretation easy. New software helps you create visual tools that clearly demonstrate your main points. Through line charts, pie charts and bar graphs, your audience can see your position and immediately consider your proposal. In other words, show don't tell.
A few caveats on this: Keep the amount of detail in a single chart low and use enough color to make an impact without becoming distracting. If there is a large amount of information to be shared, break it into multiple charts and graphs for increased comprehension. Bear in mind that line charts are the best option for showing changes over time, while bar graphs are best used for comparing two or more figures. Pie charts are the most common choice for showing percentages as part of a whole.
Replace Minutia With Big Picture Data
Finally, keep the details for handouts and focus your presentation on the big picture. While it might seem prudent to demonstrate how you came to your conclusions, your audience is unlikely to stay focused long enough to follow your narrative from the supporting details to your final point. Share highlights in your presentation, well-illustrated with visual representations, and save the full journey from start to finish for those willing to read a written report. Any critical components that you miss during the main portion of your remarks will be identified during question and answer periods at the end.
CFOs play an essential role in the business world. Some would say this role is the most critical to a company's success. However, CFOs are often passed over when it comes to sharing their insights into the organization because so many colleagues find the field of finance intimidating. CFOs that are user-friendly -- those with whom stakeholders can understand and relate -- are far more likely to be included in significant strategic conversations.