Tell Me a Story: Why Storytelling is Critical to Success in FP&A

Summary

In this edition, we will be covering the following items:

1. Why storytelling is important in business (and FP&A)

2. A simple and effective storytelling framework

3. Building good storytelling tools with Power BI and Acterys

It’s Just How We’re Wired: The Power of Storytelling

Human beings are wired to understand stories. We form deeper understanding and retain more information in the context of a story. As FP&A professionals, your job is to arm your stakeholders with actionable data to guide their decision making. Strong storytelling skills can help you do that:

1. Cognition: Your audience understands stories intuitively. When you are building your reporting, analytics, and recommendations, structuring them in a narrative format makes them much more digestible for your audience.

2. Business Context: Being able to frame your data analysis in the context of data storytelling will help ground your audience in both the numbers and the narrative. This balance of data and narrative will frame your analysis in the business context your stakeholders understand.

3. Emotional Connection: Effective storytelling makes the data more relatable and will help your audience feel the urgency and importance conveyed in your “data storytelling”.

Your New Go-To Storytelling Framework: SCR

How do we frame our thinking in story format? The SCR (Situation, Complication, Resolution) framework is a simple and effective framework for structuring your message clearly:

1. Situation: Describe the background context. Tell your audience about the current state or historical trend in the data.

   1. Example: Our company has seen consistent revenue growth of 10% per year over the past three years.

2. Complication: Introduce the problem or challenge that is disrupting the current situation. This is the turning point in your story and it’s important to make this compelling and highlight the need for action.

   1. Example: However, recent shifts in customer buying patterns have caused a slow-down to 5% annualized growth rate, threatening our long-term growth

3. Resolution: Present your recommendation and/or root cause analysis. This is where your team makes their business case, supported by data.

   1. Example: By investing $X in our content marketing efforts, we can create a new customer acquisition channel and increase our current sales by $Y.

Building Your Data Storytelling Infrastructure with Power BI and Acterys

Practicing storytelling is critical to building this competency in your FP&A team. Your team can build a suite of effective storytelling tools with Power BI and Acterys.

1. Dashboard Storytelling: Your team can structure your reporting dashboards to focus on the critical metrics and KPIs that tell a compelling story and drive a sense of urgency.

2. Dynamic Scenario Analysis: Using Acterys’ driver-based planning, your team can build comprehensive what-if scenario analysis to paint a picture of the future to your leadership team – and highlight its impact to the P&L.

Storytelling is innately human, and no technology can do the job for you. But building a data-driven culture and empowering your team with robust frameworks and tools is a great way to get started.

In the Next Newsletter

We will be discussing how to measure the ROI of any Finance Transformation project.