Finance professionals are great at dealing with the 'What'. But to really supercharge your career, you need to traffic in 'Why' and 'What next?' says Andy Shambrook, AccountingWEB's FD columnist.
When I was the head of commercial finance, once a month I would present the month end results to the board. Everyone was talking about ‘insight’; as if it was the latest new buzzword from the finance bingo-bowl.
So, I decided to present some slides titled ‘insights’. It started well, but after a few minutes the marketing director interrupted me and said: “Andy, those aren’t insights, that’s not even information. At best all you’re giving us is glorified data.”
I was a young, ambitious finance business partner, and this was brutal feedback to receive, especially in front of the rest of the board. After licking my wounds for a few weeks, I decided to go and speak with the marketing director to find out what he meant.
After all, insights are the domain of marketing. That’s what they do: search for and uncover consumer insights to direct their product development.
“Thanks for the feedback,” I opened (through somewhat gritted teeth), before asking him what he had meant by “glorified data”, and he explained to me what data is, what information is, and what insight is.
And it clicked. It was as if my whole finance career to that point flashed in front of my eyes and I realised he was totally right. I had been dealing in glorified data. The advice he gave me transformed my finance career and set me on the path to FD.
More than that though, it helped unlock career growth not just along a set path, but it served me wonderfully when I became a sales director.
I used what the marketing director said to me to create the Insight Mountain.
Data answers the question of what. More specifically, what happened in the past and what we think will happen in the future (in the case of a budget or forecast). Yes, budgeting and forecasting is future-looking, but if all we are telling people is what we think is going to happen, it’s still just data.
And there are 3 types of data – raw data, processed data, and visualised data. We take a data dump from somewhere – raw data. Then we process it into a table of numbers, P&L account, or pivot table. Then we turn it into a graph or chart, using Excel, BI or one of the new fancy apps.
But here’s the thing. You can make your data look really pretty. But if all it’s doing is telling your audience what happened, it’s still just data. Or, as the marketing director called it – glorified data.
Data only becomes information when we answer the question why. And not some crappy why like phasing, accruals, and one-offs. We want to give people root commercial drivers.
So instead of saying sales are down 4% (data) due to customer X (surface cause). We want to say sales are down 4% (data) due to customer X (surface cause), because our competitors ran a promotion (getting deeper). We were unable to respond in time to protect market share because our internal sign off procedures take 2 weeks.
Moving from data (the what) to information (the why) is about using the five whys. The principle is that you rarely get to the root cause of anything unless you ask the question why at least five times. Just be careful how you do it, to avoid a virtual punch in the face (so don’t actually use the word ‘why’!)
If data answers the question what, and information answers the question why, insight answers the question: so what next? And the great thing about getting to a root cause is that the answer to the question so what next is often staring us in the face.
Maybe it’s time to sharpen our internal approval process so we can respond faster. When I stopped dealing in the what and started dealing in root commercial cause and so what, my career took off fast.
And I soon realised that Insight Mountain is in fact the definition of being commercial. Because commercial people are only interested in the what, if it helps them answer the so what next.
If you want to take your career to the next level, and be more commercial, stop dealing in what and start dealing in so what. And you’d better hurry because technology is going take the reporting, budgeting, and forecasting of the ‘what’ largely away.
In the past you could still build a really good and senior finance career by being good at the what. Being able to deal in the so what was a nice-to-have. But in the here-and-now, it’s a must-have for career development.