On the face of it, finance and storytelling may sound like chalk and cheese. Finance is structured around numbers, statistics, facts, and hard data, all of which holds valuable information that can help financial leaders and employees make important business decisions. Storytelling, on the other hand is often considered a creative skill, rooted in language. However, Darrell Cox, Chief Finance Officer of Vena Solutions, an agile financial planning software firm, believes that finance and storytelling are in fact related and the most important thing a CFO can do is tell a story.
In a recent conversation with CXOToday, Darrell explains why every finance professional should be able to tell a powerful story based on the data they’ve collected and analyzed. He also sheds light on the changing role of CFOs in today’s digital world and how CFOs can become good storytellers to support strategic insight.
CXOToday: Why do you think storytelling is an important aspect in finance?
Darrell Cox: Storytelling in finance is important because this is how we maximize our contribution to our team and how we build better businesses together. Finance’s ultimate objective is not to file reports in a virtual filing cabinet in the sky or to satisfy the auditors once a year. Our ultimate objective is to be a great team-player who is part of a great team that builds a great business. Storytelling is about knowing and understanding our business by the numbers and about how we get what we learn to our teams and the individual members in our team, when it matters and in a way that drives great business decisions and ultimately leads to a better business. This does not happen when we present naked numbers. Telling a story means dressing up the numbers with a narrative that engages and educates our teams and equips them with what they need to enable us all to succeed together.
CXOToday: What makes the CFO a great storyteller?
Darrell Cox: Every great leader is also a great storyteller. A great CFO is someone who has earned the trust and respect of their team, who has become a trusted advisor to their CEO and to their organization. They have earned this position because they listen, empathize and understand who they are speaking to, what drives them and what they need from them to be successful. A great CFO will find the right story for the given situation or a specific audience. They will tie what has happened to what might happen and how to make a difference moving forward. Financial numbers are often lagging outcomes that are difficult to connect to a specific audience. To find the right narrative, one that will engage a team and help them succeed, it is important to connect financial outcomes with numbers that a team, or an individual on our team, can control and be responsible for. Having non-financial business drivers connected to financial outcomes is essential to connecting finance with their teams. It is the will, thoughtfulness, time and investment in the right process and systems to build a connection to their audience, their team that makes a great storyteller and a great CFO.
CXOToday: How can finance leaders capitalize on opportunities during a time of crisis and be ready to come back stronger post-crisis?
Darrell Cox: Crisis is a catalyst for change. It might force a business to become more efficient just to survive. Another business might benefit from an unexpected windfall. It can be impossible to predict what is going to happen, good or bad. The point is that in a time of crisis, or at any point in time, finance leaders need to be prepared for change and be ready to take advantage of any opportunities that may present themselves. The only thing for certain about a plan is that it is going to be wrong. The likelihood of a plan being seriously wrong is amplified by crisis and uncertainty.
The best a finance leader can do to lead their business through crisis, to be prepared and ready for anything, is to lead an agile business planning and budgeting process. It can be challenging to run a business planning with a lot of non-financial data, with a wide set of participants and to do so frequently. That said, the negative impact of uncertainty can be significantly reduced by doing so. With the right discipline in place it becomes easier. With modern business planning software agile planning can be a lot easier.
CXOToday: How can CFOs leverage the right digital tools to make strategic business decisions?
Darrell Cox: Having the right set of digital tools is very important in enabling decision makers across to make better business decisions that are aligned with business strategy. This is becoming increasingly important as the quantity of data and the sources of data continues to increase and diversify. A myriad of systems and an overwhelming amount of data can often cause key data and insights to be under-leveraged or even hidden and unused. It can be very difficult to get the right data, in the right format at the right time to the right people to make the most of it. It’s even harder to bring it all together from multiple sources and to turn this data into a story, which is important for driving better business decisions. Integrating these systems and data with an agile business planning process, which should be a key process for driving strategic business decisions in times of crisis, is basically impossible without a modern business planning tool. A CFO that is able to leverage technology to improve their strategic decision making processes is building a competitive advantage to their organization.
CXOToday: As CFO, how are you positioning the company for growth?
Darrell Cox: I am preparing my organization for growth by continually investing in and improving business processes and systems. I need to do this in order to stay ahead of the ever-increasing amount of data and systems being deployed by my team across my organization and to maintain the competitive advantage i enjoy relative to my competition by getting the right story to the right people at the right time to make better business decisions. Ideally, I am able to bring more data and more people into my business planning process thereby increasing the ability of people throughout my organization to make better business decisions.
CXOToday: What would be your expert advice to the progressive CFOs?
Darrell Cox: These are the seven principles I follow that have enabled me to be successful:
- Think big, not just looking at the challenge or opportunity of the moment, but where does it fit in relative our greater objectives
- Think forward. For me it is not just about what happened last month, it’s about how last month lines-up with earlier months and what it says about the future. It’s never about the past; it is always about the future and where we are headed and most importantly about where we want to get to
- Always be looking for change. Look beyond the financials, which are normally lagging indicators, to leading indicators. This is where I am going to see if something is going to happen or not and will give me and my team time to consider options.
- Have a bias to action. I hate to say or hear only about what happened or to be given a static piece of information. I want to drive action. Something happened, so what are we going to do about it?
- I never want to be the stereotypical CF”no”. I am part of a team and to maximize my contribution I need to listen, understand and be empathetic. I need to engage and be human!
- I need to tell a compelling story. I need to get to the right story, at the right time and tell it well so that my team listens and acts and ultimately to make better decisions because of what my Finance team delivers and to build a better business.
- I leverage technology to the maximum possible extent to get this all done. As described earlier, I need to bring data into the Finance team from across the organization, turn it into a story and put it back into the hands of as many people as possible from all across my organization quickly, on-demand and error-free. There is simply no way I would be able to do this without the latest technology.