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On November 6th, within the framework of the ESADE Alumni Refresher Programme, David Bertomeu, academic assistant in the Department of Financial Management and Control and director of ESADE’s Advanced Management Control Programme, gave the talk “A new approach to controller reporting: from data to news.
The reporting that takes place in companies is financial reporting designed by financiers for financiers. But, in fact, controllers also deal with the people in charge of areas and functions inside the company. “I’m sure that you have sometimes wondered why the people asking questions haven’t read the report beforehand. But they might actually have read it – but it wasn’t in their language. We mustn’t forget that controllers speak a different language, pointed out David Bertomeu. Financial reporting was invented by financiers, but is not always ideal for CEOs, marketing directors or sales managers.
The journalist controller
So, how can financial reporting be changed? Financial statements are produced in writing on a regular basis about certain aspects or in response to specific requests. David Bertomeu considers that the answer is a new figure: the journalist controller. “What matters is not the data themselves but the news behind the data, and that is what we have to convey, he says.
So, the new challenge facing controllers is how to create news, and the first thing to bear in mind is the intended recipient because something of interest to the CEO may not interest the sales director, for example. Bertomeu outlined the first step towards converting a financial report into a sort of executive summary featuring the main news items, and seized the opportunity to explain the key factors involved by giving practical examples of the technique to ensure clear, hard-hitting communication.
The 3x3 technique
David Bertomeu explained this technique for creating news. On the one hand, there are three steps for planning news and, on the other, three principles for creating it.
When planning a news item, the first step is to know who the message is aimed at in order to tailor the message to them. The second step is to know what the message is, and the third step, the format to be used.
As regards how to write a news item, the first and most important point is that every message must elicit a response. “Think about the response you want to elicit and make the next step obvious, emphasised Bertomeu. “The best way to do this is to ask what lies behind each news item.
The second principle is that each message must be relevant. “It’s important to remove any noise from the graphics or the news itself. We sometimes overwhelm people with information in the belief that this helps, when in fact it has the completely opposite effect. Finally, the third principle when writing a news item is that it must be easy to remember – and what matters here is how you tell it.
Professor Bertomeu gave several examples to illustrate different ways of creating financial reports with data and also with news. Several were based on the same example of reporting: a prominent headline, three subtitles or comments, the last of which elicits a response, and some data to illustrate the news. The toughest challenge for the controller is undoubtedly knowing how to draft a story able to make readers react. “The hardest part is knowing what response you want to prompt and who has to take this decision. It’s essential to always be polite and discerning but thought-provoking. You have to take readers slightly out of their comfort zone, said Bertomeu.