FP&A professionals are masters at analytical thinking and numerical analysis, but they also need to learn how to tell an amazing story with data.
Believe it or not, not everyone in your board meetings can read and analyze data like a pro. Most people outside of the finance function look at data graphs and spreadsheets like they’re something out of The Matrix movies. They know the data is important and that it means something that could potentially impact the business, but they’re not sure what.
This is where you step in. As an FP&A expert, you understand how the data comes together, what it means, and how that data can be used to make better-informed decisions that lead to real-world success.
The only thing left to do is figure out how to convert data into compelling stories to share with the CEO and other stakeholders. In this article, you’ll learn why data visualization storytelling is so important and how to tell amazing stories with data.
Topics covered in this article:
- What is data visualization storytelling?
- Why do FP&A teams need to be great storytellers?
- Three tips to tell better data-driven stories
- Data visualization storytelling techniques
What is data visualization storytelling?
Data visualization storytelling translates data into stories to help others understand exactly what the data means.
Don’t worry, nobody’s asking you to write the next big fantasy epic. You’re essentially translating data into a visual context, which makes it easier for others to make sense of it.
Some examples of translating information into visuals include:
- Colorful tables
Rather than looking at data on a screen and trying to figure out what it means, visual aids make it easier to identify patterns or trends in the data.
Data visualization storytelling requires some degree of creativity on your part. Creating a narrative and weaving a story together with data is a useful skill for any finance professional to have.
One of the best ways to tell a story with data is by anchoring your narrative in facts. Think of how you can communicate the true meaning of the data in a way that’ll keep your audience engaged. Focus on emphasizing why the data is relevant.
You also need to try and communicate your story with clarity. The last thing you want is for your audience to feel like they have to study large datasets for hours to grasp your message.
Why do FP&A teams need to be great storytellers?
80% of CFOs agree that data storytelling is an essential skill for today’s finance professionals, and it’s not that surprising if you think about it.
Humans are visual creatures. We’re naturally drawn to visually appealing things, hence our undying love for the cinema and pictures of cute animals. We also love a nice graph. We’d rather look at a colorful representation of data because it makes it easier to identify patterns and comprehend the meaning of complex data.
Data visualization storytelling is a form of visual art. It grabs our attention and keeps it there long enough for us to grasp the message behind the data.
There are lots of reasons why FP&A teams should embrace data visualization and work on their storytelling skills. But, in case you need some more convincing, here are a few of the best benefits of telling stories with large amounts of data:
Data visualization storytelling makes it easier to grasp the meaning of large datasets
As we’ve mentioned, data visualization presents information in a way that’s easy to digest. You can look at a huge spreadsheet of numbers and have no idea what any of it means. Yet, if you’re presented the same information as a story on a chart or graph, for example, you can grasp complex information in a matter of seconds.
Anchoring your claims in facts boosts your credibility
Nothing boosts credibility like stating how it is. By rooting your data stories in facts, you make it extremely difficult for anyone to disagree with your claims. Since you’re only presenting factual information, your overall message comes across as more credible than if you presented ideas or solutions based on assumptions.
A unified understanding of data leads to better solutions
Representing data in a way that’s easy to absorb, makes it a lot easier for everyone to understand the data and make faster, better-informed decisions. Not only that, but if you have convincing data visualization storytelling skills, you’ll be in a much stronger position to recommend what steps the business should take next to improve.
How FP&A teams can tell better stories with data visualization best practices
FP&A professionals can’t tell great data-driven stories without considering three key areas of the data visualization storytelling process:
1. Understand the data
If you don’t understand the data you’re presenting, how can you expect anyone else to understand it?
As an FP&A expert, you need to understand the data and the call to action (CTA) the business must take. Once you have a thorough grasp of the data, the next step is to develop your key message.
2. Know your story and consider your audience
You’ve got the data, now you’ve got to pin your story down. The best data visualization stories are always empathetic and relevant to the audience. Once you have your key message, it’s time to build a story around it using data.
Let’s say that you have an idea of how the company can cut costs, save more money, and become more profitable in the future. You know your boss and the entire board of C-Suite members are going to love your idea.
Unfortunately, a great idea isn’t enough. You also need data to back your story and justify your idea. Consider what data sets are going to communicate your story as effectively as possible for maximum impact.
When developing your story, consider...
- Your story's purpose
- Your target audience
- The risks and opportunities you want to cover
- The call to action
We recommend starting with a hook to draw the audience in. Then, bring them along for the ride and continue to build momentum until you reach a solution (the CTA).
3. Choose the right data visualization storytelling chart
The final step in creating your data visualization story is to choose the right visuals to support your story and make it as compelling as possible.
Need some help choosing what data-driven narrative to go with for your story? Here are a few of the best ones:
Comparison/Correlations – Comparing one set of data with another and looking at how they evolve over time is a good narrative strategy to analyze trends more broadly.
Trends – Numbers rarely stay the same. If you notice numbers increasing and decreasing, look out for trends within the data that could tell an important story that the company needs to pay attention to. Trend graphs are one of the best methods to showcase how specific trends are impacting the business.
League table – If you need to focus on hierarchy, a rank order table is a useful way to show the ranking order of a range of stats and KPIs. You can organize the data in a chart or table to make the data easily digestible.
Data visualization storytelling techniques
FP&A teams are bombarded with data. It’s one thing to have all that data on a spreadsheet, but how can you present it in a more visually appealing way?
There are a few commonly used methods to present data such as charts, tables, graphs, infographics, maps, and dashboards. However, there are also some more specific methods of data visualization that you might find useful.
Let’s look at some of the best data visualization storytelling methods and techniques for FP&A professionals:
- Area chart
- Bar chart
- Gantt chart
- Pie chart
- Line chart
- Bullet graph
- Wedge stack graph
- Bar graph
- Highlight table
- Text tables
- Dot distribution map
- Heat map
Other ways to present data:
- Box-and-whisker plots
- Bubble cloud
- Circle view
- Polar area
- Radial tree
- Scatter plot (2D or 3D)
- Word cloud
Effective data visualization is a vital skill for FP&A professionals. After all, data is central to most business-related decisions. So, if you can learn to tell compelling stories with data, you’ll see a lot more success when it comes to presenting your ideas with credibility. You'll also have a higher chance of gaining the support you need to see those ideas put into action.
Want more great FP&A content? Check out more of our articles and resources here.