Be Less Distracted by 'Why' questions and focus on 'How'

An important characteristic of FP&A practitioners is a commitment to continuous improvement. There are a number of ways for FP&A practitioners to commit toward improving their work. For me, one of the ways I commit to continuous improvement is reading books.

A book that I recently read was SUPERFORECASTING by Philip Tetlock and Dan Gardner. There are a number of helpful statements in the book and for me, one statement stands out as a guide for improvement.  The statement appears on page 150: “A probabilistic thinker will be less distracted by ‘why’ questions and focus on ‘how.’”

This statement provides a way to improve the work of FP&A practitioners.

Organizations are created to accomplish a number of goals; for example, becoming an effective, value-added organization.  Accomplishing this and other goals requires thinking from people who work in functions like production, selling, and administration.  Helping people think about their work in these functions is a natural task for FP&A practitioners.

Years ago I met with the co-founders of a startup to provide advice on accounting for expenses.  Before I gave my advice I was curious to know how they were going to sell their product and how they were going to support their business.  My questions were a way to explain how to account for their expenses by dividing them into selling and administrative.  The discussion about administrative expenses gave the founders ideas on how to compensate people for their services.  The founders walked away with focus on what they can control through how they act.  This focus is a way to work within financial planning.  Financial planning is a thinking process that creates ideas on how to become an effective, value-added organization through actions within one’s control.

Reflecting on work like this through reading books like SUPERFORECASTING provides a way for FP&A practitioners to improve their financial planning process.

Organizations strive to be viable entities. In order to be viable entities people within organizations need to understand their activities and effects.  Creating an environment for understanding these elements is a natural task for FP&A practitioners.

A small business owner hired me to help improve his company’s cash flows.  One point I emphasized was we needed to know how his company received and spent money.  Knowing this provided insight into how work was being done.  After acquiring this insight we developed a framework for action.  The framework stressed acts that were in the control of the small business owner.  The framework also developed processes on how to receive money faster and prioritize spending money.  The elements within this framework could not have been accomplished without understanding how the company received and spent money.

We experience situations that fail to provide reasons “why” situations worked against our favor.  We may never learn “why” an employment opportunity wasn’t secured.  We also may never learn “why” a customer or vendor went bankrupt.  These and other situations are not solely influenced by our actions.  As FP&A practitioners we need to help others by focusing on what they can influence, i.e. how they act.

How we as FP&A practitioners act comes from personality traits like curiosity and creativity.  These traits help us do good work but we can always find ways to do better work.  The way to do better work is through a commitment to continuous improvement.

Remember…a way to commit toward improvement is asking how.