“A story is different. It does not expend itself. It preserves and concentrates its strength and is capable of releasing it even after a long time.” - Walter Benjamin, author of The Storyteller, from a 1973 collection of essays.
Walter Benjamin’s quote highlights something special: the often-unrecognized power of a story. Offering up financial information in the form of a story can be beneficial when trying to communicate data in a way that your audience can easily understand and remember.
To help understand the power of a good story, think back to the last time you found yourself completely lost in the silver screen or between the pages of your favorite novel. Out of all the tens, hundreds or even thousands of movies or books you have watched or read, why is this one so special or memorable?
For example, think about the movie, “A Few Good Men.” Many people can recall a great deal of the climactic conversation between Colonel Jessup (played by Jack Nicholson) and his rival, Lieutenant Daniel Kaffee (played by Tom Cruise). In the scene, Jessup is being cajoled by Kaffee, who is demanding an answer to an overly sensitive question regarding who called the “Code Red.” Eventually, Jessup provides a passionate response to the questions being asked by Kaffee, though he did not fully recognize the weight and implications of his answer. When we think back to this movie, particularly this scene, what was it that we appreciated? Was it the competition between the witness and lawyer, the personal courage of Kaffee, who put his entire career on the line by asking such a controversial question, or was it the odd sense of duty displayed by Jessup?
What we have come to know about the scene is that, although we resonate with the general subject matter, there is also something biological happening. On the molecular level, when in the presence of an excellent film or story, the brain is activated in a myriad of ways. First, a neurochemical compound named oxytocin is being synthesized in the hypothalamus. Second, the pituitary gland sends orders throughout your nervous system for cortisol production in the adrenal glands just above your kidneys. Third, neurons throughout your brain are firing in every direction, stimulating your senses and attention. For generations, these natural subconscious brain reactions have been utilized to motivate people to engage in behaviors such as reciprocity, empathy, volunteering, inspiration, goodwill or charity. Studies have shown that it is the brain’s chemical reactions to enjoyable stories that trigger not only the prosocial traits previously mentioned but also establish a wonderful sense of information recall as it relates to the underlying message of the story.
For many accounting professionals, the struggle lies in communicating complex financial information or solutions in a way that colleagues or clients can easily understand. So, how can accountants and CPAs use the power of storytelling?
STAR Technique
The simplest and most effective method to employ the art of storytelling is the STAR Technique: Situation, Task, Action, Result.
- Situation: Explain to your audience any relevant background information as it relates to the context of the work you’ve performed. This sets the stage for your story and can be utilized to draw importance or justification to the work you are about to present.
- Task: Next, explain your mission. Use this opportunity to bridge the relevant background information to what you set out to accomplish or address.
- Action: This is often the longest part of your story and where you can make your mark. The goal is to explain to your audience — in the appropriate level of detail — your journey from start to finish. The level of detail should be tailored to your ability to communicate complex ideas or methodologies in a manner that is digestible to the acumen of your audience. If you provide numbers, don’t just tell your audience, show them the underlying story. Act as a translator and break the information into bite-size pieces.
- Result: Finally, tie it all together. Summarize how the information you presented relates to the needs of the audience and the context of their situation. Tell them what you accomplished and provide them with actionable conclusions or recommendations.
Seeing It in Action
Imagine a scenario where you’re an expert financial consultant who has been retained to testify before a jury on the value of a family-owned and operated soda manufacturing company (“Pop Co.”) in light of a secret recipe that has been wrongfully leaked to its competitors. You’re presenting your conclusion of value in the STAR format.
- Situation: You explain to the jury why you were approached by your client and how you were retained to value their company. You tell them the background of Pop Co. and how, generations ago, a family member crafted a secret formula that would one day be used to build a nationally recognized brand. You further explain the nature of the valuation as it relates to the leakage of the secret recipe and your client’s need for financial reparations.
- Task: You explain to the jury your mission to utilize the financial data of the business to construct a valuation model to ultimately create financial clarity as to the value of Pop Co.
- Action: You explain that you concluded your valuation by ultimately relying on the income approach to determine a $55 million value of Pop Co. Instead of simply showing the financial numbers related to the calculation model that generated the $55 million valuation, you apply your creative framework. You convey and tell the story of a business that came from humble beginnings, serving a small community in New York. You then recognize, in your financial analysis of decades of statements, how this once-local business flourished through their increase in capital expenditures to build state-of-the-art facilities and gained loyal, hardworking employees through generous salaries to grow to operations and distributions in all 50 states. You convey that you tracked market share in the U.S. beverage market and relate that to cycles shown in the business’ cashflows. You ultimately take the numbers off the page and give them life through the relatable context supporting your $55 million valuation.
- Result: In your conclusion, you remind the jury of the quintessential role this secret recipe played in building Pop Co. and the financial devastation in the wake of its leakage from the business. You leave the jury with your credentials and qualifications that further solidify your insights and conclusions, which leaves a lasting impression from a qualified expert.
What this framework conceptualizes is the power of a story — the power to affect tangible results with a narrative. By employing this simple framework, you will not only be remarkable as an expert in your field, but you will be easily understood and remembered for your exceptional ability to connect and convey your complex work product in a creative way that resonates with clients and other professionals.