Presenting Financial Data Using the Right Business Graphic
When presenting financial data, we can use software tools to help enhance the message. Often we choose too many features to make the presentation beautiful or colorful and inadvertently reduce the clarity of the message. This article will help you understand “must know” choices when using business graphics.
Effectively presenting financial data requires identifying two important pieces of information:
- What do you want the recipients of the data to take away from the data? For example, you may need to present detailed results of fundraising campaigns or allocations of personnel costs to programs.
- What will the recipients do with the data? For example, recipients may need to understand demographic or geographic influences related to fundraising or how time allocations might need to be adjusted among program areas.
Answering these two questions enables you to answer the presentation questions themselves: What format best represents the data? How should the format be used to send the intended message? The data need to be presented to meet your needs and the needs of the recipients. The goal is to meet the information needs of the presenter and recipients, not to communicate solely what is true or accurate.
What message are you sending and are they seeking to receive?
Financial data drives decisions. Are the data you’re presenting enabling someone to commit funds to a project? change the marketing options in a business unit? justify the hiring or firing of employees? set priorities for the coming year? Invariably, you will have a point of view, and the recipients will have a point of view. These two perspectives often differ, so you must analyze what both points of view are and how they are compatible or incompatible. Once you understand the data, you can decide how best to present the message.
In two examples below, the data contain messages. If the recipients of the data can’t easily identify the message, they will find a message in the data that suits their purposes, not those of the presenter. So the data require a title that states the message of the graph or table, and the data should efficiently represent that message.
For example, assume you are presenting data that show unexpected results for the quarter, and you believe those results are abnormal. Your audience, though, wants to use the unexpected results to justify a key decision to implement change. Your job is to present the data accurately and clearly communicate that the data are the result of unusual circumstances and are unlikely to be repeated. You must limit the ability of the recipients to ignore the message and base a decision on data that doesn’t support that decision, so you would present the data with a title that communicates the message of the graph or table.
In another example, you are presenting data that show a positive result from a series of recent financial decisions, and the audience is eager to have those positive results shared. So you will present the data with a title that communicates that the key financial decisions paid off with good results.
What format best represents the data?
When considering how to present the data in graphic form or a table, rely on the message you are delivering. Choose a graph that sends the message of the data effectively: No matter how beautiful graphs can be, the role of the graph is to deliver information. Bar and column charts show comparisons; column and line charts accommodate time or frequency components; pie charts show how components compare to the whole. Experts in graphs tend to see the pie chart as the least useful because the messages they send are often sent more clearly with bar or column charts. Experts also suggest that unless a 3-D view clarifies the message, choose the 2-D option.
How should the format be used to send the intended message?
Data need to be presented simply. Select an appropriate graph or table, and eliminate extra information such as unnecessary color, lines, images, and extra fonts.
The requirement for effective presentation of financial data is to ensure the data communicate the message intended by the presenter and the information the recipients need. Unfortunately, using the many tools available can lead either to obscuring or clarifying the message(s) of the data.
- Provide context for the data: Presenting results as absolute numbers doesn’t help recipients understand whether the data are beneficial or damaging. Consider presenting the numbers as percentages, or perhaps in comparisons to the previous or expected results.
- Present financial data at an appropriate level of detail: Excessive detail masks the information, so present numbers as simply as required by the message the recipients need to understand. Consider eliminating decimal places or rounding up so that the recipient can understand the significance of the numbers without having to filter details. Don’t eliminate decimal places, however, if that level of detail must be communicated.
PowerPoint remains the dominant tool used to present financial data. Fortunately, PowerPoint is a rich tool with many appealing, sophisticated options for presenting data. Unfortunately, that richness can quickly become problematic. PowerPoint all too easily becomes distracting if too many special effects are used. It can be an effective tool for organizing thoughts and delivering content to a large audience of people with different learning styles, but presenters often depend too heavily on multimedia effects that overwhelm the main points. We strongly suggest that the three best message delivery tools are “slides with bulleted lists or SmartArt bullets; slides with simple bar, column, and line charts; and a handout that includes supporting documentation. Also, limiting the number of fonts pays off by keeping the text and graphics clean and readable.
We have sophisticated tools and can create beautiful presentations, but it is more important that presenters understand the financial data and then communicate the message(s) of the data. As expert Jonathan Koomey points out, “Good analysis is often handicapped in its presentation because the authors have not taken the vital last step of thinking about what the audience cares about and expressing the results in those terms.”
If you enjoyed these tips, watch for an upcoming article that will discuss the features to copy or link business graphics from Excel to Word or PowerPoint.