Five years ago, in my article "Strategies to Solve the Soft Skill Shortage in FP&A", I discussed the critical need for strong programming and financial modelling skills in Financial Planning and Analysis (FP&A). I emphasised that technical prowess alone is not sufficient. Effective communication and interpersonal skills are equally vital for modern FP&A professionals. As the FP&A function continues to evolve, soft skills will remain crucial. Let's explore several strategies to bolster these essential skills in today's dynamic business environment.

Evolving Technical and Interpersonal Balance

The FP&A function continues to embrace advanced analytics and automation. While strong programming skills (in R, SQL, Python, and VBA) and financial modelling remain non-negotiable, the ability to translate complex data insights into actionable business strategies through clear communication has become even more critical than ever. Miscommunication can lead to costly errors and missed opportunities. As FP&A professionals, our role is to ensure that our analyses are not only accurate but also easily understood by stakeholders across various levels of financial literacy.

To address the evolving communication demands in FP&A, consider these four strategies:

1. Emphasise Active Listening

While I previously highlighted the importance of asking the right questions, active listening goes a step further. It involves fully concentrating, understanding, responding, and remembering what is being said. A deeper engagement helps us truly understand the needs and concerns of stakeholders, leading to more effective communication and problem-solving.

2. Leverage Technology for Enhanced Communication

The continuous development of collaborative tools such as Slack, Microsoft Teams, and advanced data visualisation software like Tableau and Power BI has transformed how we communicate and transfer data. We can use these tools to create interactive dashboards and real-time reports that can cater to various learning styles, whether visual, auditory, or kinesthetic. This technological integration ensures that messages are not only delivered but also absorbed effectively.

Tip:

When presenting complex data, consider using a mix of charts, graphs, and bullet points to cater to different audience preferences. This not only keeps the audience engaged but also helps us reinforce key points. Do not overdo the use of those charts and graphs, as, at some point, too much information on the slides may distract your audience from the core message.

3. Simplify Complexity with Storytelling

Translating complex financial data into a relatable and understandable narrative for non-experts is a powerful skill. Storytelling involves framing data within a context that highlights its relevance and impact on business objectives. This approach can make data more accessible and engaging, driving better decision-making.

Tip:

Start by identifying the core message or insight you want to convey. Then, build a story around it, using real-world examples or hypothetical scenarios to illustrate your point.

4. Foster a Feedback-Rich Culture

Touching on the previously mentioned strategy of regular feedback, we need to understand that creating a culture where feedback is continuously encouraged and valued is essential. Such a culture not only applies to client interactions but also to FP&A teams. Encourage colleagues to share constructive feedback frequently, fostering an environment of continuous improvement and mutual growth.

Enhance Learning Approaches

To effectively bridge the soft skills gap, it's crucial to let our learning approaches evolve.

• Contextual Learning Revisited

The distinction between contextual and standard learning remains pivotal. As Stephen Krashen's comprehensible input model suggests¹, learning in context, especially for technical and financial jargon, enhances understanding and retention. Encourage team members to engage with new concepts in practical scenarios rather than through memorisation. This method not only improves comprehension but also boosts confidence in applying new knowledge effectively.

Tip:

Incorporate case studies or real-world scenarios in training sessions to help team members better understand how to apply technical skills in context.

• Emotional Intelligence: The Foundation of Soft Skills

Emotional intelligence (EI) underpins all soft skills. It involves self-awareness, self-regulation, motivation, empathy, and social skills. In the fast-paced and often stressful FP&A environment, high EI enables professionals to navigate complex interpersonal dynamics, manage stress, and maintain productive relationships. Investing in EI training can lead to better teamwork, enhanced leadership, and improved client interactions.

Tip:

Consider implementing regular EI training workshops and encourage team members to practice mindfulness techniques to enhance self-awareness and emotional regulation. Team members are likely to adopt it if they see it as an example being set around them. Internal culture is more potent in dynamics than we sometimes realise.

Conclusion

It is inevitable that the fusion of technical and soft skills remains crucial for success in FP&A. As we continue to navigate a rapidly changing financial landscape, the ability to communicate effectively, learn contextually, and develop emotional intelligence will distinguish top performers. By embracing these updated strategies, FP&A professionals can not only enhance their capabilities but also create greater value for their organisations.

References:

1 - Krashen, S. D. (1982). Principles and practice in second language acquisition. Pergamon Press. https://www.sdkrashen.com/content/books/principles_and_practice.pdf
Accessed October 10, 2024.