Are you not good at numbers?
What to Focus On and How to Change That!
The excuses not to like finance reports
and why you should love them!
You might have heard that a million times whenever you have spoken to non-financial colleagues:
“Finance and finance evaluation is so boring”
“I’m not good at numbers”
“Those reports are for the finance department”
“I have to focus on my business and don’t have much time to look at the reports”
“If I have a question, I will ask somebody within the finance team”
“The report and numbers are so confusing”
etc. and many other excuses. I can totally relate and understand. You want to focus on your operational business. You don’t have time for that. Though numbers and analysis are a part of your entire business and believe me, financial reports are not so difficult to understand. Let’s talk about that in a minute.
One thing is for sure, if you want to be successful whether you are an entrepreneur or the head of a team, you must be able to understand and analyze financial reports. Everything you do will end up in your books being either profit or loss.
I have often seen companies with a high net profit, which neglect the evaluation of their numbers with the argument: “Our profit is very good, we are earning so much, we don’t need to analyze”.
But what happens when times are changing, like e.g., Covid did. Suddenly companies, which were highly profitable, where suddenly confronted with less profit or even worse with unexpected losses.
If you want to be successful on long terms you must understand where your profit comes from or what causes your loss. That’s no secret.
My story in short
Let me tell you my story: Twenty years ago, I was not a numbers person myself. I had been working in many different operational departments. Suddenly I had to take over the finance department. You might imagine not being a “numbers person” that this did not make me happy at all. Should I quit? No!
Instead, I learned how to read balance sheets, analyze profit and loss reports, and understand the bookkeeping itself.
My approach was entirely different from the “real bookkeepers” and finance people. I needed to understand the entire business for the bookkeeping to make sense. I learned how to implement and use reports, implemented Controlling and Finance systems company wide using technology. Most of the time I pretended I would own the company and had to derive decision from what I saw in the reports. That helped me.
My most important take away:
Finance is not made to bore people; it is made to help you to take the right decisions for your business future.
The Challenge
So, let’s look at the most common complaints I mentioned at the beginning: Finance reports are boring, not being a numbers person, too complicated, etc. Where does that come from?
In my opinion finance trainings are mostly made for finance and controlling people, those who love numbers and are familiar with lots of details around that topic.
The trainings are not made for people in the marketing or sales departments for example, but they should be made for them, with their focus and goals. A salesperson has to sell products and not do create reports or book incoming invoices; however, she/he has to understand what decrease of e.g., net sales means and how to invoke an increase in sales.
Make Marketing for Controlling
So how to solve the problem? Tell a story!
Communication is key! Try to understand your target audience and what is important for them! Ask your audience questions about their daily obstacles and challenges.
Use communication skills to explain the reports to your colleagues, always keeping in mind that they need to understand what to change, maintain or omit in their business.
Communicate in a simple way. Finance and controlling are not complicated, the way it is taught and told is complicated.
If you are the owner of the company, make sure that your employees understand what your goals are, and how the numbers in the reports contribute to your business plan. Align reports with the entire company strategy – focus on that.
Finance reports should focus on simplifying the finance topics. Finance and reporting trainings should be fun and interactive. Choose examples from “real life” to bring finance closer to your employees or colleagues.
From my experience, I have taught many employees how to build, read and use finance reports, I am sure you will succeed to draw so much more understanding and interest to finance topics.
Imagine your employee, for example from the sales department, would have a much better understanding of the numbers. The impact she/he could make to your company whenever they sell something? She/he would be able to make better and strategic decisions.
Have I inspired you to look at this topic a different way?
Do you have any more questions, or do you need help with your reporting?
Do you need support?
Do you need support with your management reports? Let me know and send an email to Cordula.buss@planatoccontrolling.com or leave a message below.
Let's do it!
