We’ve discussed the issue of silo’d departments on the blog before. Most recently, we talked about tearing down the wall that divides sales and marketing. Another area where I see walls being built is around corporate finance. Smart executives know how important it is for all departments to stay on top of finances, but they often run up against resistance.
Frankly, that’s a shame. Effective financial communications are critical even when not speaking to shareholders or other investors. So, whether it’s because of a turf war, lack of discipline, or just plain uncertainty, it pays to remove these obstacles and make sure every key employee has a relative handle on corporate finance.
But “I Don’t Do Numbers”
I’ve heard a lot of otherwise talented marketers and corporate communicators say, “I’m a marketer/writer/communicator, I don’t do numbers.” This statement is frustrating to hear Every. Single. Time.
1. Whether you work for a start-up, non-profit, government agency, or blue-chip titan of Wall Street, finances matter. If any part of your job involves convincing investors to risk their cold hard cash, you obviously better have those numbers on the tip of your tongue (or at least on the top of your mind).
But even beyond the typical financial stakeholders, media, employees, and customers all view companies through a financial lens. They are thinking: How stable are they? Are they hiring? Are they expanding their footprint in our area? Beyond our area? Understanding this perspective is crucial if you’re going to create a message that resonates with your audience.
2. If you can’t speak confidently about your organization’s business model, you’re missing an opportunity to add long-term value to your employer. Executives understand this point well. This is likely one big reason they have landed the positions they hold. And as a leader charged with mentoring others in the organization, you can’t stress this piece of corporate communications enough.
Organizations NEED communicators “at the table,” but if you can’t speak the language of business (finance) then you won’t be of value at that table. Regardless of what you take to be your primary role in the organization, if you want to rise in the ranks, you need to be on the lookout for places where you can “punch above your weight.” Being able to talk corporate finance is a huge advantage.
3. Financials are the proof points to your broader corporate message. In this context, financials can be revenue, market cap, overhead expenses, membership growth, etc. It is difficult to see how a marketer who doesn’t understand this point could truly understand marketing. Any marketing message that is divorced from a company’s finances risks falling flat, or worse, overpromising and under delivering can be a death knell for sales.
Empower Staff to Be Comfortable Communicating Financials
While it’s easy to say that every key employee should be able to speak about corporate finance, it’s a lot harder to make this goal a reality. How do you empower those within your organization to become comfortable with and effective at communicating financials?
1. If your company is publicly-traded, encourage your employees to read your 10-K, 10-Q, annual report, and proxy statements. You could also ask the finance director to do a short presentation or Q&A for all department heads.
2. Encourage leaders in marketing, sales, and other departments to take your IR lead out for coffee (bonus points if they do the same for your financial planning and analysis (FP&A) lead!). There’s no substitute for hearing about the state of an organization’s financials from the experts themselves. They can provide powerful insights and help in understanding the business model.
3. One great way to help get everyone up to speed is to read and talk about your industry publications (including the WSJ and FT if possible). It’s not important for everyone to read them cover to cover (or top to bottom online), but these articles will provide a general understanding of the impact of market movements on your industry. You could, for example, start a weekly meeting with a discussion of an important shift in the market and its impact on your business.
4. Actively follow your competitors and talk about what they’re doing well and where you have the upperhand. Encourage team members to listen to how peers speak about their business in the press, at events, in their writing, and in their financial filings.
5. Keep learning! This goes for everyone involved with your organization. There are some great FREE corporate finance courses out there (e.g., Finance for Non-Finance Professionals created by Rice University professors and offered through Coursera). Also, professional organizations (e.g., PRSA, IABC, NIRI) have opportunities to gain additional business savvy. Consider incentives for employees who put in the extra effort to gain skills in corporate finance.
6. Hire Audacia (joking… kinda). But seriously, sometimes bringing in communications professionals with an actual background in finance can make all the difference. Corporate finance is our world, let us introduce it to your team. Or, better yet, before you go through the trouble of trying absolutely everything, why not sit down for a consultation and let us steer you in the right direction?
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