How to communicate complicated ideas
Professor
Mitchell A. Petersen of the Kellogg School of Management offers six tools to
help leaders communicate complicated ideas
Business
leaders need to communicate ideas that may not always be simple to their
audiences—be it for a one-on-one, leading a company meeting, or just trying to
make sense of something themselves. Mitchell A. Petersen, a professor of
finance at the Kellogg School of Management, Northwestern University, Illinois,
US and an expert in empirical corporate finance, offers six tools to help
leaders communicate complicated ideas.
Data
Data
provides detailed, and dispassionate, characterization of what has occurred
previously. As such, data serves as the foundation for predictions about the
future. Before financial experts began collecting daily data on stock prices,
returns and dividends, for example, nobody had a sense of how typical stocks
performed over time—and how they might be expected to perform going forward.
“The
beauty of data is it tells us what happened in the past,” says Petersen. “It’s
descriptive. Now, the disadvantage of data is it doesn’t necessarily tell you
how variables are related. It is just the landscape without any underlying
structure.”
In
other words, all the raw data points in the world are not going to
automatically provide you with a solid case for favouring one decision or
prediction over another—which can be where logic comes in.
Logic
Logic
is valuable in its own right—after all, if your audience struggles to follow
the thread of your argument, it will be tough to convince them that the
argument is sound. But logic also serves as a fruitful breeding ground for more
rigorous analysis. “Equations are a way to boil complex relationships down into
a small number of important levers.”
Equations
Equations
allow you to make your case with precision and accuracy. Equations capture
relationships between variables mathematically, so that those relationships can
be mapped to actual data. Peterson says that it is rare for an equation to
capture all the relationships among a complicated set of variables, so good
equations also make a statement about the most important relationships.
Pictures
Pictures
or visuals offer your audience an invaluable way of remembering the
relationships between different variables. The right visual offers an easy way
to see, internalize, and later recall even complicated informational trends.
When
presenting complex information to an audience, “I’ll put up the data in a
table, because I want them to see the details,” says Petersen. “I also put up
the picture, because it makes the concept much more persistent.”
Stories
Stories
that summarize certain logics or relationships between variables are perhaps
the most memorable all. “There are no cultures that I know of that don’t tell
stories,” says Petersen. These stories can become memorable, almost tangible
shorthand for even very abstract concepts. An elaborate story about a Coca-Cola
investor swapping shares with first a Pepsi investor, then an orange juice
investor, next a peanut butter investor, and finally a tractor investor, might
vividly encapsulate the benefits of an otherwise nebulous concept like
diversification.
Participation
Tools
like data or equations or even stories are of limited value if an audience
feels they can’t push back, disagree or ask for clarifications. The more senior
your audience is, says Petersen, the more important it is to actively create
pauses or other spaces where misunderstandings can be voiced. Want to know
whether your audience is with you? Just stop and say, “Somebody please ask me a
question,” Petersen advises.
Source | Mint | 21 September 2016
Regards
Pralhad Jadhav
Senior Manager @ Library
Khaitan & Co
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