Light bulb moment

Posted by on Sep 16, 2015 in Financial literacy | No Comments

shutterstock_293272022

We recently have experienced a light bulb moment at Wise up Now and I will reveal all later. It resulted from a recent visit to the doctor with my young son who had not been very well. The doctor asked him had he had any adverse pain in his lower abdomen and how had his bowel movement been. I found it incredible that he chose such language to communicate with a child. Had he said do you have a pain in your tummy and have you had a poo recently all would have been clear. It then got me thinking that finance people have communicated this way for years using language in reports that nobody else understands with the inevitable outcome of financially illiterate management teams.

The key role of finance is often seen to be the provider of management information. The irony of this is that most of the information which they provide is not management information but information only intelligible to finance staff. Some managers try to get around this by enrolling on finance for financial managers courses, which again is testament to poor communication from the finance function.

The real danger here though is that if the people with which you are sharing your information do not know what you are talking about then they will not be able to make the best decisions. In essence these people who don’t understand the number are playing a game in which they have no idea of the score.

One of the key things we see when working with finance business partnering teams is that the successful ones consider if the information they provide is well understood. The first test is to evaluate how many people outside of finance ask detailed questions on what you provide. I would also encourage you to use data visualization as much as you can.

At Wise up Now we have recently been working with companies to help improve their financial literacy. By that, I don’t mean telling them the difference between a debit and a credit but have been helping the whole business team understand their numbers more so they can see how they impact on their part of the business. In some cases the results have been revolutionary and transformed the way people work. We have found that when people understand the numbers they connect much more and become more engaged. They also get a feeling of ownership and become more likely to work out ways to make those numbers better.

Having worked in finance for years I really see this as a light bulb moment and would encourage all of you financial report writers to change the way you speak and all you financial report readers to speak up and say you don’t get what finance is saying.

If you would like to know more about how you might do it I am happy to share what works best .

Also why not join in the discussion with fellow finance business partners from around the world by joining the finance business partners discussion group

Leave a Reply