If your goal is to advise leaders and clients, become a CCO or agency head, mentor others and earn a higher salary, learn as much as you can about business and finance.
Resist the urge to say, “I’m not good at numbers.” This is a lot like learning a new sport. You start with a genuine desire, some dedicated time to practice, and a goal to keep improving. The payoff for building your business and financial competence? You’ll develop more result-oriented communications and increase your value to your organization and clients.
Not only that—you’ll have an even more successful career.
Here are three things to consider as you start to build your business/finance IQ.
1. Measure what matters.
In an article for IABC’s Communication World, Jim Shaffer noted that traditional communication functions measure things like tweets, channel usage and page views. He stressed, however: “If you want to get off the sidelines and influence what’s important, try measuring against business objectives.”
Shaffer, an IABC Fellow and author of the book, “The Leadership Solution,” is a widely recognized expert on communication measurement. His advice: Measure what matters and direct your communication activities to improving results and adding value.
Do you understand the difference between revenues and profits? Vision and mission? Goals and objectives? One of the projects we do as part of George Washington University’s strategic PR master’s program involves developing an internal or external communication plan that identifies the organizational goal, the communication goal, and the related communication objective(s). It’s critical to be able to connect an organization’s need, such as reducing costs or improving quality, with a specific communication goal (what the communication program will emphasize or do) and an objective (a measurable outcome).
“Developing a monthly newsletter” is a tactic, not a goal, for example. The ability to articulate and fine-tune your goals and objectives is a business skill that will yield benefits in the program or campaign’s results.
Reading others’ communication and PR plans—and not only within your peer group of organizations—is an invaluable learning opportunity. Seeing how others have addressed an opportunity or challenge and the ultimate results is eye-opening. These plans address a huge range of needs, from generating sales for a specific product or service to reducing costs; from increasing employee retention and engagement to recruiting hard-to-find talent; from influencing regulation to building reputation in a specific niche.
Environmental, social and governance (ESG) initiatives are also an emerging opportunity for linking communication and PR programs directly to organizational priorities.
Here are three of my favorite examples of comms plans tied to business goals:
- The Holmes Report’s PR campaign of the decade, “Doritos Crash the Super Bowl”
- An IABC Gold Quill winner, “I am your nurse,” an internal communications recognition and recruitment campaign from the Provincial Health Services Authority in British Columbia, Canada
- The GM faulty ignition switch crisis from The Arthur W. Page Society case study competition
Ask yourself: Am I following and using best practice communication planning models? Do I always try to start with the business/organizational goal or need and then develop my communication goals and measurable objectives?
2. Embrace the numbers.
Rick Gould, who wrote “The Ultimate PR Agency Financial Management Handbook,” has consulted with hundreds of creative service businesses and CEOs. Managing partner of Gould+Partners, Gould notes that there has been one consistent pattern in his interactions. “The owners of the firms knew little, if anything, about the business of their business,” he said. “They relied heavily on their CPA, their attorney, even their bookkeeper. And their results showed it.”
“Each may have been a great communicator, PR person, ad executive, designer—but that’s not enough,” he added. “If you want to maximize the value of your firm or your corporate department, you must understand how to read a balance sheet, P&L and cash flow statement, as well as the critical profitability benchmarks and metrics in your industry.”
Metrics matter. Understand the drivers of your organization’s performance, whether it’s for-profit or nonprofit. If you work for an agency, understand the metrics that are most meaningful for your firm—as well as for your clients.
Ask yourself: Can I identify the top three key performance indicators for my organization (or clients)? Am I actively following trends in my industry/sector (or, in the case of not-for-profits, organizations that are viewed as peers or as role models)?
3. Be a business partner.
I remember hearing a senior communicator in a large corporation lament the fact that people in other departments would come to her and say, “I need a brochure,” or “I need a video.” She said she found it discouraging, because she tried to approach each situation with an eye on the business need—not the tactic. The tools and tactics would come next, she said, but only after she and her business colleagues had identified and talked through the problem or opportunity.
The “keep asking why” mantra works so well in these situations. Why attend an event, do a speech, or produce a video or ad? You might need to ask the “why” question several times in the same conversation in order to really drill down to the core issue.
“Help me understand what you want to achieve” is one way to frame the question and show you’re genuinely interested. It’s also a way to push back against “tactic-itis” and address real organizational needs or challenges. It also shows that you see yourself as a partner and collaborator.
“The most successful business relationships grow from a firm alignment of interests,” says Cary Hatch, CEO of MDB, an integrated creative agency with more than 30 years of experience. “By embracing not only the communications challenges, but the business challenges, we form true and enduring partnerships.”
Consider, too, the skills you can offer to people who work in accounting or investor relations, or who do budgeting. Perhaps you could do a trade, of sorts; they can teach you more about finance, and you could offer presentation skills training or edit something they’ve written. I was able to do this early in my career with someone on our accounting team, and it evolved into a very productive partnership.
Ask yourself: Do I understand my organization’s top leaders and what they care about? Do I see myself as a business partner? Am I asking my business colleagues the right questions and spending the time to genuinely understand their goals and their concerns?
In summary, I hope you’ll consider Rick Gould’s advice. “Building your financial IQ is an ongoing, career long process,” he asserts. “The sooner you start this journey the more successful you will be.”
Karen Vahouny, a former presenter for Ragan Communication’s Business Fluency Boot Camp, is an independent communications consultant who has worked in both the corporate and agency world. She is an adjunct professor at George Washington University.