CHAPTER 1

Embracing the “Communicate or Die” Philosophy in Finance

The good news is that we certainly don’t think you’ll literally die if you don’t embrace the communication lessons we share with you in this book. To torture a phrase from Shakespeare’s Hamlet, however, you may shuffle off your professional coil if you close this book now without taking heed of the advice we are about to share. We hope that for the sake of your career you will forge ahead!

This book is intended for finance professionals in the early stages of their careers. Even if you’re not in that demographic, we promise that you will learn a few new tricks. If you are in our target audience, then the publisher has done a good job of marketing this book. We hope you’re asking yourself why you should be reading this book. After all, you’re a professional in a data-driven, number-crunching profession who has also most likely taken English composition and public speaking in college. Why read a book on professional communication? What’s the point? We look forward to answering those questions in this chapter.

Jason, who holds a PhD in Communication Science, has taught communication courses for nearly 15 years on topics such as organizational communication, managerial communication, and (ahem) public speaking. Lisa brings a dozen years of professional finance experience and a PhD in Finance to the classroom, where she has, for nearly 15 years, been teaching finance to undergraduate and graduate students. Between the two of us, we have heard your questions hundreds—if not thousands—of times. So, let’s spend some time here in Chapter 1 addressing those questions. By the end of the chapter, we hope you’ll come to understand that professional communication skills:

• Include more than basic composition and public speaking

• Are in low supply and high demand in the finance industry

• Will give you a competitive advantage throughout your career

English Composition and Public Speaking Are Not Enough

As we said before, you’ve probably taken one or two English composition classes while you were in college. In fact, before you started your career, you probably wrote a number of papers for your college classes. If you haven’t started your professional career, then we have a secret to share with you. College writing is not the same thing as writing for a professional audience. Many of the lessons you learned about writing simply don’t apply. Those of you with more work experience may have already figured that out. That said, we do not advise you fire off an angry missive to your former professors for wasting your time. They taught you a number of valuable lessons about writing. We argue that the factors highlighted in Table 1.1 constitute major differences between the writing you did in college and the writing you should do in your career. The best business communicators understand these factors.

The writing you produced in college was written for a professor. Not all professors are the same. So, one valuable lesson you learned from those writing experiences is that you have to always put your audience first. You know that you need to make your audience happy. That’s a lesson you should carry with you throughout your career and a point we come back to repeatedly throughout this book.

Table 1.1 Major differences between compositional and professional writing

In business writing, however, you usually communicate to busy professionals whose jobs don’t typically include evaluating your writing skills (although that doesn’t mean they don’t judge you). These professionals need you to get to the point so they can move on with their days. In many cases, you are not writing for a single audience. You are also writing for secondary audiences. The people who write annual reports are not writing for an individual, but for a number of audiences, including investors and regulators. Financial planners help clients with their financial affairs. Their audience often includes people with very limited knowledge of finance. In large organizations, internal memos and reports must be written for multiple audiences within the organization who have varying degrees of expertise in finance. Although you must always make your audience happy, that task can be substantially more difficult in business because your audience is often fragmented and diverse.

Don’t just take our word for it. Vincent Finelli is a 26-year-old finance professional who holds an MBA and has two years’ experience as a risk analyst for a global commodities trading firm. He talked with us about the importance of understanding his audience. In his work, he communicates with colleagues from around the globe. As a result, it is critical for him to avoid jargon, slang, and idioms in his communications because he needs to be sensitive to language and cultural differences. Additionally, his job places highly private financial information at his disposal. As a result, he has to be aware of his audience because oversharing this information in the trading environment is accompanied by business and legal implications. There are few one-size-fits-all communication scenarios he faces because his audience is always so diverse. His heightened awareness of these communication issues has allowed him to tailor his communications. Communicating in a diverse environment where language and cultural differences exist were not part of his undergraduate writing experience.¹

Vincent Finelli
Risk Analyst Global Commodities Trading Firm

Because your audience is different in business than that in college, the tone of your messages will be affected. Compositional writing taught in college usually stresses passive voice and formal tone. Business writing prefers active voice and conversational tone. We describe passive voice in greater detail later in the book. For now, suffice it to say that passive voice follows an object–verb–subject pattern. Active voice follows the subject– verb–object pattern. In other words, active voice sentences tell us who did what to whom (or what). Active voice sentences are generally clearer and easier to understand.

Consider the following simple example: Lisa ran a half marathon. As some of you may know, running a half marathon is not easy. In this case, our author Lisa has actually run a half marathon. That’s a major accomplishment for which she deserves credit. The active sentence places emphasis on the subject (Lisa), gives her credit, and makes it easy for the reader to know who did what to whom (or what). If we write the same sentence in passive voice, it would read one of two ways:

• A half marathon was run by Lisa.

• A half marathon was run.

Both passive sentences place the emphasis on the object (half marathon). The second passive sentence excludes the subject (Lisa). Given how hard she worked to train for and run a half marathon, Lisa would not be happy losing the credit for her accomplishment.

Your college professors wanted you to demonstrate the quality and depth of your thinking when writing essays and reports. That usually resulted in long papers. Remember how they always asked you for— sigh—page minimums? That approach served its purpose. However, your professional audiences don’t have that kind of time. They want you to provide the necessary information, make your request, or provide your recommendation. As long as you can demonstrate that you’ve done your research, this audience prefers that you get to the point sooner, rather than later. In fact, Jason’s assignments to his managerial communication students have page maximums, because if you can’t make your point succinctly, then your audience won’t care to finish reading your tome. Save the thesis for the classroom.

Composition classes are not sufficient for making you an effective business writer, and public speaking classes are not sufficient for making you an effective business presenter. Why isn’t a public speaking class sufficient for developing the presentation skills you need for your career? In public speaking, you learned—we hope—about organizing your thoughts, supporting points with evidence, and the importance of an extemporaneous style (i.e., not reading your presentation from notes). Those are all valuable lessons. However, for most of us, the vast majority of our professional presentations will be delivered to small audiences, often fewer than 10 people. Public speaking courses do not prepare you for delivering a presentation to a small audience in a boardroom. They do not prepare you for the unique challenges of the business context, including presenting financial statements to managers, making budget recommendations, participating in quarterly report calls to investors, selling a new product, pitching a product to investors, defending an unpopular decision to employees, or teaching nonfinancial managers how to explain financial data to lay audiences.

The point here is that you need to approach writing and speaking in a different way than you have in the past. This book will help you develop the skills you need to be an effective business communicator. The next thing we have to do, however, is to explain to you why you should care about being an effective business communicator.

Business Communication Skills and Your Career

People believe they are effective communicators. It makes sense. We all communicate all day long for our entire lives. We all have years of experience. Unfortunately, having lots of experience does not always make you better. If you do something wrong a million times, you’re still doing it wrong.

Most of your peers believe they are already effective communicators and will never seek the guidance necessary to go from bad to good or good to great. As a result, those people are presenting you with a competitive advantage. Let’s take a closer look at the advantage they’re providing you and on which you are now capitalizing. You’re finance people, so we should probably show you some numbers now.

How many of your peers believe they are effective communicators? The Hart Research Associates, on behalf of the Association of American Colleges and Universities, recently conducted a nationwide study of more than 400 large employers and more than 600 recent college graduates about career readiness. When those graduates were asked if they were well prepared for work in terms of their communication skills, do you know what they said? Not surprisingly, they reported feeling prepared. In fact, 62% felt their oral communication skills were adequate and 65% felt the same way about their writing skills.

Although we’re college professors and would love to take this opportunity to pat ourselves on the back, that would be premature. In the same study, employers were asked about the preparedness of recent college graduates. Their outlook on the situation was less rosy. A mere 28% of employers reported that recent college graduates have adequate oral communication skills, and 27% felt that way about written communication skills.²

Do you see the disconnect? Young professionals tend to believe they are good communicators. Their employers disagree. How do you feel about your written and oral communication skills? How do you think your employer feels? How much do written and oral communication skills matter, anyway? We’re glad you asked. Here’s a hint, we wrote a book about the importance of communication skills for young finance professionals.

Employers do, in fact, care about your communication skills. According to its 2015 survey of employers, the National Association of Colleges and Employers (NACE) found that 85% of employers said oral communication skills were sought in recent graduates, although 73% of employers indicated that written communication skills were important.³ Moreover, the NACE college graduate career readiness task force, comprising representatives from major employers and universities, cited oral and written communication skills as one of seven competencies that prepare students for a successful transition from school to work.⁴ Employers in the Hart Research Associates study nearly universally agreed that skills including communication, critical thinking, and problem solving are more important to career success than is a student’s major.⁵

A 2015 USA Today article reported on a CareerBuilder survey of employers. Their findings should lend even more kindling to the fire we hope is beginning to build inside you about capitalizing on the competitive advantage gained through focus on communication skills. Of the top five soft skills cited in the CareerBuilder study, oral communication skills ranked #3 and written communication skills ranked #5. The article’s author reports that

while many companies have open positions and are eager to hire, they report having trouble finding qualified candidates to fill those positions. Twenty-one percent of employers surveyed by Career-Builder said they didn’t feel that colleges were doing enough to prepare students for the working world. ... employers are troubled by graduates’ lack of soft skills.⁶

And this advice applies to professionals from all fields, including finance. In fact, a recent article on finance job skills made the case for the importance of communication skills in the finance industry. The authors argued:

Finance jobs require skills in communicating policies and procedures to other employees and customers. Finance professionals should be able to present the budget to staff members and explain why there is a profit or loss. Finance positions in a bank or investment firm include communicating with customers on a regular basis and answering questions about financial transactions. During meetings and conferences, executive finance professionals make presentations on the financial health of a company to other staff, board members and potential clients.⁷

Written and oral communication skills are important for helping you be effective in your work, but the benefits of effective communication don’t end there. Your communication skills influence the impressions that you make on others. In fact, this is a skill we call impression management. Whether you like it or not, other people form opinions about your professional character based on whatever information they have about you. Your communication skills can help you manage or mismanage the impression that others form. A 2014 York College study on professionalism asked university career development professionals what qualities best represent a recent graduate’s professionalism. Fifty-six percent of the respondents made a reference to communication skills.⁸

Do you remember when we asked you about your employer’s impression of your communication skills? The odds suggest that your employer doesn’t think much of your written and oral communication skills. But how does your employer see you as a professional?

The York College of Pennsylvania 2014 National Professionalism Survey of Career Development Professionals points to technology as a major reason for a decrease in professionalism due to its negative effect on focus and interpersonal and communication skills.⁹ Millennials generally expect that they can freely communicate with friends via text and social media during working hours.¹⁰ Furthermore, the perception is that the majority of millennials abuse technology and circumvent company IT policies.¹¹ It should come as no surprise that millennials are cited as the generation most lacking in qualities of professionalism.¹² Regardless of whether the perceptions of millennials are accurate, the perceptions exist and are pervasive in the modern workplace. We interviewed a finance professional with 17 years’ experience who presently works as a vice president for a broadband communications firm. He said:

There is a clear distinction in workplace communication with Millennials compared to their more experienced colleagues. This is particularly evident in the use of smart phones and instant messaging. Millennials can often be noticed working on their computer while multi-tasking on their smart phones via headsets (i.e. listening to music) or text messaging. While the preferred medium for conversation and exchange of information with more experienced colleagues is face-to-face discussions, phone conversations and e-mails, such experienced colleagues are finding it more efficient and impactful to communicate with their millennial counterparts in quick, fact based, concise messages via smart phone/texting. In an almost perceived avoidance of face-to-face conversations, web based meetings and screen sharing are also becoming prevalent with younger colleagues as well.¹³

And although we professors may be loath to admit it, perhaps colleges and universities aren’t doing enough to help students develop these key soft skills. Many business schools don’t require communication courses beyond those included in general education requirements. The common business core tends to be heavy in quantitative skills.

In addition to courses, however, universities do offer career services and development opportunities. But many students aren’t taking advantage of those opportunities. The 2014 York College study on workplace professionalism concluded that few students use career development programs, with only 53% of students using those services in their senior year (and far fewer using those services prior to senior year).¹⁴ In fact, our university offers skill development workshops, such as the one advertised in Figure 1.1.

Figure 1.1 Skills workshop flyer

Attendance at these events is usually paltry, however. If college course-work doesn’t prepare students and only half of all students bother to use career development programs, it’s no wonder students enter the workplace without the necessary skills to succeed.

Conclusion

By now, we hope that we’ve answered your questions about why you should read this book and put its lessons into practice (see Box 1.1). Communication skills are highly desired in business, particularly in the finance industry; the communication skills you picked up through college coursework are not sufficient; most of your peers believe they have the necessary communication skills to succeed but their employers disagree; your communication skills influence the impressions others form about you; and few people take advantage of the professional development opportunities presented to them. For all of these reasons, we argue that developing your communication skills will give you a competitive advantage in your career. So many careers are needlessly on life support. Embracing the “communicate or die” philosophy will help ensure a long, healthy career.

Box 1.1 Chapter 1 takeaways