By Carlinde Kallianiotis, CEO, Partner and Leadership Coach, Ginger Leadership Communications
Previously published in The Digital CFO magazine (Summer 2023)
Why storytelling is a critical skill for CFOs
For CFOs to assume the role of change agent and transformation enabler, they must embrace financial storytelling and communicate the why behind the numbers.
During his first board meeting, Nick Salas, the new CFO of one of North America’s largest designers and producers of clothing and accessories, learned the importance of telling the story behind the numbers. When the CEO saw that Nick brought a huge, indexed binder to the meeting, he said: “I never want you to bring that binder anywhere again. If a CFO is only using numbers, they’re not telling the story.” He then reminded him that he already had people who could provide him with the numbers, what he needed was a partner who could tell the story of what the numbers mean for the business. Initially taken aback, Nick soon came to understand that financial data alone was not enough to tell the full story of a business’ success and that once you’re a CFO it’s much more about storytelling and influencing than sharing numbers.
Lucy Perrell, the CFO of a technology company, recognized the power of storytelling when presenting the company’s financial data to employees and stakeholders. She shared a story about one of the families that benefited from the company’s low-cost educational software and explained how it had helped a child with a learning disability access personalized learning resources, leading to better grades and a newfound love for learning. By connecting financial data to a larger narrative, she was able to not only demonstrate increased revenue but also inspire everyone in the organization to continue striving for success.
On the surface, finance and storytelling might seem to be polar opposites: one is about numbers, the other about language. However, like the CFOs in the above examples, if you can uncover the narrative in the numbers, you have at your disposal a powerful tool that provides context to facts and figures. It allows the C-suite, Board and other stakeholders to connect with your message on an emotional level and understand the financial impact on the business.
As a CFO, you’re not only tasked with telling the story of what’s in the past but also what’s to come. With the vast amounts of data available within every organization, you need to be able to curate that information and provide powerful insights to both internal and external stakeholders and investors. There’s no better way to do this than by finding the narrative in the numbers.
The CFO shift
It’s now widely accepted that the role of the CFO has shifted from backward-looking reporting and risk management to forward-thinking planning and strategy. According to a white paper put together by Brainyard, 82% are accountable for their company’s strategic direction, in addition to budgeting, auditing, reporting, and integrating new technology.1
To fully assume this role, they must be able to identify and communicate the meaning of their data and create a plan of action that stakeholders can embrace and support. Then they need to tell the story of the success that will result from that action. Connecting financial data to a larger story can inspire and unite teams towards a common goal.
As a CFO, you’re not only tasked with telling the story of what’s in the past but also what’s to come. With the vast amounts of data available within every organization, you need to be able to curate that information and provide powerful insights to both internal and external stakeholders and investors. There’s no better way to do this than by finding the narrative in the numbers.
The Chief Data Storyteller
According to a recent eBook created by Insight Solutions, the CFO needs to evolve into the CDS – the Chief Data Storyteller. “A CFO’s role should be just as much about understanding, investigating and sharing the stories behind the business as it is about balancing the books and reporting the numbers.” 2 However, this is easier said than done. CFOs are generally not trained storytellers. In fact, they may believe that telling a story is frivolous or may even undermine the data. Far better to stick to the old way of presenting the numbers because the numbers speak for themselves, right? Well, no not really. They might speak to finance professionals but not to those who don’t spend their lives pouring over spreadsheets.
What do the numbers mean? What can you tell us about them? How can you help us make an informed decision? Can you make numbers fun?
How to turn numbers into a story
Here are a few quick tips to start you on your data storytelling journey:
- Look at the data the way a detective examines a crime scene. Then present your evidence and build your case in the form of a narrative. Don’t forget there’s a human story behind every data point, so start to see data as a huge set of tiny stories.
- What’s the strategic narrative of your company? Think about where your customers/clients are right now. Where do you want to take them and how are you going to get them there? What has to happen? What obstacles need to be overcome? How can you bring them with you? Start by identifying the change you want to create and reverse engineer your story from there.
- Start and end with a story rather than a graph or bar chart. Data visualizations can be effective, but you still need to wrap them in a narrative – and make it personal if you can. Don’t forget that people buy people, not numbers.
- Rather than rattling off figures, think of more inventive and relatable ways to contextualize them – for example, rather than saying, “We sold 1.5 million units,” you could say, “The number of units sold would fill an Olympic-sized stadium.”
- Experiment with one of the basic tenets of effective storytelling – show, don’t tell. For example, a global newspaper recently wrote an article about the wealth position of the richest person on earth ($185 billion USD). To make this number imaginable for the reader, they explained that this money could buy you 400,000 modern town houses in the US. Not everyone is as familiar with financial numbers and these storytelling tricks are effective.
The CFOs in the opening stories understood that data doesn’t speak for itself. You need to speak for it and that means finding the narrative in the numbers. Most importantly, learning how to tell stories well won’t take as long as you think – and it’s guaranteed to provide a huge return on investment as you evolve in your role.
For more information about Ginger Leadership Communications’ flagship Storytelling Mastery program, go to www.gingerleadershipcomms.com/course/storytelling-mastery
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1 https://www.netsuite.com/portal/assets/pdf/wp-brainyard-state-of-the-cfo-role-in-2019.pdf
2 https://insightsoftware.com/resources/the-evolution-of-the-cfo-into-the-chief-data-storyteller/
