Plansmith Blog

Communicate Your Numbers Like a PRO!

Posted by Jennifer Mello on 3/4/20 11:16 AM

I know my numbers, but how do I communicate them to others within my organization?

It’s a valid question that Plansmith fields regularly from our clients. We’ve got some answers for you.

Everyone relates to numbers, no matter who you're talking to, but not everyone reads them in the same way. So, how do you make the most out of your conversations with everyone who needs to relate to the same numbers?

It doesn't matter what type of program you’re using - whether it's something done off the core using Excel, a quarterly call report outlook, or a GL-based program with cashflows, you still have to read your numbers and communicate the results.

It all begins is with using three types of data: Budgets, Actuals, and Forecasts.

Within these numbers, we know there's a story! Now it’s time to uncover that story by answering three questions: Where are we? Where should we be? Why is it different?

From here, there are three levels of audiences we need to communicate the number story to: You, Your Management Team, and the Board.

The tough part is how to get creative with your communication. It's not just about getting everyone on the same page by showing the SAME analysis and the discovery. It's about adopting and committing to the "need to know" basis.

They all need to get the same message, but not necessarily in the same way. By constantly adjusting the same message, you can give them exactly what they need to know in order to understand the story.

At Plansmith, we get this question all the time: Why are my numbers my numbers?

So, let's play this out in the form of a realistic example:

We're a quarter through the year- it's about mid-month, so you’re working hard! You're grinding away at your desk when someone stops by and mentions they saw the preliminary reports and wants to talk about the drop in margin. They ask you to find some answers because the board meeting is right around the corner.

You're thinking, “I know these numbers, I saw that decrease, and if it's not making sense to them, then it won't make sense to the Board.” So, now you're tasked with figuring out what's going on and being able to communicate it to everyone.

Where do you start? 

Identify the Question – drop in margin

First, we’d pull a margin report, compare it to the budget, and note when and where the margin starts to drop.


We know what drives margin - income and expense - so we dive into our first report…

Find the Reason - Summary Income Variance with Forecast

Focus on the big picture categories for income and expense.

We find that expense doesn’t actually look too bad, and in looking closer, we see that the Loan category is the big picture driver of our question - WHAT IS UP WITH LOANS?

“At one quarter in, I have a problem with 40K off, if that keeps up, we'll have a $500K problem by the end of the year.”


You have a lot of loans in there. You don't have the time to research every single one.

Expand the report to more detail, and through that we see Commercial R/E is the bulk of it… so WHY is the income so off?


Investigate the Cause – Simple Variance Analysis

Looking at a recap in this report, over to the right side it quantifies the differences in income to show the biggest component of the change is YIELD. So what happened to our Commercial Loan rates this year that is causing this variance in the budgeted yields?


See, the numbers are telling all sorts of stories… we just have to find them.

Let’s dive into those yields.

I like to go back to last quarter. It helps paint a better picture of where we were when we created this budget. Looking back , we budgeted our yield based on current activity. Now looking forward, we can easily see that's not happening. Let's graph this. Most of our reports, at least in Plansmith’s Compass, can be clicked on to create instant graphs.


You've investigated the Question – drop in margin

Stick to the question at hand.

The analysis showed LOANS were driving the issue,

The MAJORITY from Commercial Loans,

And we’ve identified the YIELD as the cause.

Now, let’s discuss the course of action, as opposed to focusing on other discrepant yields that aren’t materially impacting margin.

The trick from all of this is one thing: MAKE YOUR BUDGET WORK FOR YOU.

Don’t over-explain questions using extra information. Read the room and tell the right story using the numbers that speak to the correct audience.

If you're ready to see how Plansmith can help your budget work for you, click here to schedule a discovery call.


Topics: community bank planning, interest rate risk management, IRR, credit union planning, asset liability management, budgeting

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