You know the scenario - just when you thought you had all the answers, they changed all the questions! Nowhere is this truer than with accounting and finance leaders playing a partnership or advisor role.
As a member of a finance team, it’s no longer good enough to simply present a heap of historical data and leave the rest to your business or client to resolve. Because here’s the harsh reality: there is no value in information alone. Unless, of course, your explanation helps the decision makers create real value by increasing the performance of the company and its operating parts, or improving the efficiency of its capital structure.
Modern financial modelling and related tools are helping to create this value for their users in a faster and more sustainable way. The ability to model and shape decisions is increasingly becoming a "must-have" in the toolkit of accounting and finance professionals, helping them provide meaningful insights and flexible scenario reviews to support complex decisions.
Lance Rubin is a financial modelling expert across a range of diverse businesses and sectors. He has over 20 years’ experience as an investment banker and CFO and has worked with all layers of business, from operational to Board level. He has a strong reputation throughout the industry of being a highly accomplished and lateral thinking financial modeler and finance leader. His ability to distil complex financial problems into meaningful and insightful models has made his team highly sought after for financial modelling projects in a range of complex environments or scenarios.
Lance works as part of The Outperformer team with individuals and teams around:
FROM COMPLEX SCENARIOS TO VISUAL INFLUENCE
Recently, Lance ran a webinar on The Outperformer, about how visual influence is changing the face of financial modelling. Together they explored:
It’s a webinar you really need to watch to get the full benefit, as visual influence is, of course, better explained with visual examples! It’s available here on our website. In the meantime, here is a brief summary of some of the more important take-outs:
Lance believes we’ve seen a shift away from traditionally historical, compliance-based reporting to more forward-thinking, commercial reporting. This aligns with the way business leaders need to run their business and decision making.
“The key to being commercial is to look forward, and to dynamically change,” he says. “Being able to build a robust, 3-way model that looks at the impact on the balance sheet in terms of cash, the impact on the P&L in terms of profitability, and the overall cash flow is hugely valuable. It’s also valuable from a process perspective. We spend a lot of time in spreadsheets, and there’s a lot of data. In order to move to a more value-add scenario, we need there to be value in the modelling. We need to be more impactful (as finance leaders) and become great at storytelling.
“In finance, we can spend hours preparing a management pack, but it takes just five minutes in a board meeting to discuss. This is not (where the value lies), and it’s not the best use of our time. Increasingly, we’re being asked by recruiting companies and hiring managers to look for financial modelling skills, but what does this actually mean? It means finding ways to more accurately predict what’s going to happen in the future. To identify the trends and scenarios.”
To help explain the concept, Lance uses a relatable analogy: Formula 1 racing.
“Finance professionals and accountants are technical, so we’re the mechanics,” he says. “We understand what’s under the hood. The race car driver needs to drive the car and win the race, and it’s our job as mechanics to help them. We want to help them make relevant, informed and purposeful decisions by giving them a dashboard to play with. Visual influence helps us do this. It gives them not only the dashboard but also the steering wheel so they can drive better decisions. It helps us build a car that is quick but is seen from the viewpoint of the driver, not from that of the mechanic.
“We need to deliver something useful. A whole lot of numbers on a page is very distracting, and it’s hard to glean from a table of numbers what’s actually going on. So we use visual influence to educate and help leaders understand what’s happening so that they can make better decisions. It’s about using our expertise, but transforming it into a story. “
Lance has a wonderful example of a model he used to do just this as a case study on the webinar, so please visit our website to watch the whole webinar.