The Problem with FP&A Storytelling

Introduction: The Role of FP&A

FP&A is supposed to be the eyes and ears of an organization’s financial health. Their role is to follow 4 tasks: gather data, validate it, summarize it, and use those findings to deliver insights and recommendations to executives and stakeholders.

Don’t get me wrong—Sales, Marketing, Product Development, and even HR are crucial as well. But ensuring that the business has cash, is profitable (or understanding why it’s not), and understanding what is driving revenue growth or decline is paramount. Ultimately, the goal of any business is to make some money (while doing some good in the world we hope), and FP&A ensures that the business is doing just that.

The Problem: FP&A Struggling with Storytelling

But here’s the problem: FP&A professionals spend so much time on the first three components of their job that they fail to complete the final task—crafting a compelling story to deliver their insights to key stakeholders.

The reason they struggle with storytelling and delivering value is a lack of time. Even with modern technology, many FP&A professionals are still piecing together reports and forecasts, scrambling to send the numbers just in time for the big meeting.

In this article, we’ll address the gap between FP&A professionals being seen as number crunchers versus becoming true business partners.

The Importance of Financial Storytelling

To tell a good financial story, one must take the time to sit with the numbers in front of them, critically thinking about what it all means. From there, they should start asking questions like, "Why is our customer retention in Europe going down?" or "What’s driving the huge increase in marketing spend—is this a one-time thing, or will it continue?"

Next, we take these insights and questions and validate them with the appropriate parties—not just to confirm there’s no mistake, but to truly understand the meaning behind the numbers.

 There is more to delivering key insights than just stating, "Customer retention is down 5%, or marketing expenses are up 10%." The real value comes from uncovering the deeper meaning behind these trends, and that’s how we can truly inform high-level decision-makers about what’s going on.

Providing Context for Better Understanding

Saying that customer retention in Europe is down because our best account manager just went on maternity leave, or that the increase in marketing expenses is due to the necessary spend for a new ad campaign, helps provide context for what’s happening. 

This is crucial when communicating with a group of people from different business backgrounds, especially those who may not solely focus on the numbers.

The Issue: Lack of Time to Analyze and Tell the Story

The key component in understanding the output of financial models—asking the right questions, getting the answers, and crafting the story—is time. 

Unfortunately, in FP&A, time is often in short supply during the reporting cycle. It’s unlikely that we’ll have the time to truly sit with the numbers because we’re caught up in repeated iterations of whatever financial model we’re using for reporting and forecasting. Much of this extra time comes from having suboptimal data and modeling processes in place. 

Sometimes these processes are inherited from previous employees; other times, they were created in a rush to deliver results, leading to inefficient, repetitive methods that hinder scalability.

The Impact: Stress and Career Growth

All the time spent tracking down numbers that aren't adding up, adjusting formulas, or digging to understand if the variance you're seeing is real or just another quirk in the model takes away from the opportunity to not only craft a story with the numbers but also from your growth as a financial professional. 

It also impacts your personal life. How many of us have been up until 10 pm frantically hitting F9, hoping the refresh will finally make the numbers align so we can get some rest? 

And sometimes, even when you do manage to sleep, it’s not great because you’re mentally replaying the Excel model, wondering if you missed something—because one small mistake could throw everything off and make you look bad in front of the entire company.

The Solution: Improving Financial Processes

What’s needed is a better financial process from start to finish. FP&A professionals shouldn’t be spending the majority of their time stressing over Excel, but this continues to happen. 

The worst part is that both the professional and the company want to see career growth, but how can someone grow as a financial professional when they’re spending most of their time editing formulas and data sets?

Often, finance teams and company executives are hesitant to change their financial reporting processes and would rather stick with what they know, even if it’s error-prone and takes weeks to complete. 

This fear of change needs to be addressed if you want not only numbers in front of you each month, but also a cohesive story that empowers you to make decisions that put the business in the best financial position possible.

How to Make This Happen

So how can we make this happen, you might ask? Two paths come to mind that will create the space needed for your FP&A process to improve.

Option 1 is giving the FP&A professional or team the space to focus on this. What often happens is that once the report and forecast are complete, they’re immediately overwhelmed with additional requests and ad hoc tasks that take up their bandwidth. Some of these are important, but others are less critical. 

Try to allow FP&A some time between submitting the reporting package and the next cycle. Developing a new process takes time and requires a high level of attention to detail, so ensure they have the bandwidth to get the job done right. Otherwise, you’ll find yourself back where you started.

Option 2 is bringing in an additional consultant or contractor with experience in developing financial processes that deliver impactful reports, giving your finance team the ability to better communicate what’s happening in the business. 

This person or team will work cross-functionally with internal and external parties who own the sales and financial data to create a process where the data is easily aggregated, validated, formatted, and uploaded into a summarization model of your choice, such as Excel, Power BI, Tableau, etc. This will greatly reduce or eliminate the need for manual, error-prone tasks moving forward.

Iterating the Process and Finding Success

The idea is to run this new process alongside your current one for a few months to identify any differences and understand why they exist. Sometimes, there could be something missing from the logic of the new process; other times, the original process may have had flawed logic to begin with (I’ve seen this happen too).

After a few iterations, once the numbers stabilize into a view that is both clear and easy to understand, the FP&A function can truly "delight" stakeholders by telling a compelling story with the results.

Conclusion: The Path Forward for FP&A

If our leaders make this commitment, they’ll help finance professionals take a crucial step toward becoming better financial partners and providing better visibility into the business. 

To truly unlock the business partnering potential of FP&A, we must shift the focus by dedicating time and resources to refining financial processes. This empowers FP&A professionals to analyze data deeply, think critically, and craft meaningful stories.

By improving processes, fostering collaboration, and embracing change, organizations can transform their financial function into a powerful tool for making informed decisions that drive business success. It’s time to stop letting outdated practices hold FP&A back and start creating an environment where financial storytelling can truly thrive.