What managers can learn from musicians
On understanding and being understood
A quaver is always a quaver. And it always looks like a quaver – whether written by Mozart, Beethoven or Vivaldi. That’s the beauty of musical notation. In business communication, it’s different. Here you can look in vain for uniform standards and clear patterns. Instead, diverse and mostly arbitrary colours and shapes in reports, presentations and dashboards tend to distract from the key messages rather than highlighting them. BI expert Jürgen Faisst (photo: Marion Luttenberger) wants to change that. Together with his fellow campaigners at the IBCS Association, he’s on a mission to promote and continue developing standardized patterns in business communication, from which senders and receivers of management reports benefit in equal measure.
In the Solid, outlined, hatched guide, you and Professor Rolf Hichert together make the case for uniform standards in reporting. Could you give us a practical example from everyday working life?
Faisst: In a typical report, there will be data from the past, which we call actual data, as well as plan data for the future. If you create a column chart in Excel for the period from 2018 to 2022, Excel will generate five identical columns. But this is clumsy because only the columns from 2018 to 2020 show actual data. 2021 and 2022, on the other hand, haven’t happened yet, which is why it would be good if these columns looked different. My advice would be to show the actual data from 2018 to 2020 in solid columns and the plan data for 2022 in an outlined column. I’d visualize the intervening forecast for 2021 as hatched. If this were done consistently in all reports, things that mean the same would always look the same and would therefore be easier to understand. If we’re successful with the revolutionary idea of International Business Communication Standards, IBCS for short, reports from different software products with the same figures on the same subject matter will eventually look largely identical.
In other words, it’s a question of eliminating the room for interpretation through better comparability?
That’s right. Room for interpretation arises when the same fact is depicted first in one way and then in another. But people would understand the fact much more quickly if they could recognize the same patterns again and again. That’s not the case if the plan looks exactly like the actual data or if it is shown in yellow on one occasion and in red on another. If, however, we’ve been conditioned to expect that plan figures are always outlined, we’ll immediately recognise this graphic pattern and can easily find our way around. So, if we standardize the graphic representation of facts, we can take them in more quickly. And, at the same time, we can reduce the risk of errors in decisions based on them.
What’s the SUCCESS formula of the IBCS standards all about?
The SUCCESS formula contains seven areas with rules that we recommend following if you want to write reports that are easy to understand. The “U” in the SUCCESS formula stands for UNIFY – for applying consistent semantic notation. That’s also precisely what our book Solid, outlined, hatched and the accompanying video course are about, because that is what’s actually new about the IBCS standards. Data visualization experts such as Edward Tufte have been trying to convince us of the rules of the other six areas for more than thirty years. You can’t help wondering why even now you still see all that incomprehensible chaos in the reports and dashboards out there. We believe that this seventh area, known as UNIFY, also helps to implement the rules of the other six areas.
What progress have you made in your endeavours to establish the idea in the business world?
The concept is already widespread in German-speaking countries. Around 6,500 financial controllers and BI consultants have now passed through our German seminars. This is leaving its mark especially on larger companies and their specifications for software vendors. Though it will still take a while for the trend to reach the smaller businesses as well, I’d contend that it’s now unstoppable in the German-speaking world. Our idea is gaining more and more attention on the international stage too. The not-for-profit IBCS Association, which promotes the ongoing development of the IBCS standards, now has over 5,500 members, the majority of whom are not German speakers. In addition, we have trained instructors in Australia, UK, Croatia, Netherlands, Poland, Spain and Turkey. Raising international awareness of the topic is right at the top of our list of priorities.
What do you think about Corporate Planning’s approach of combining flexible planning with IBCS-compliant reporting in one solution?
A planning solution as the basis for reporting has an invaluable advantage in that the metadata required for consistent IBCS notation are already available. The planning solution therefore knows whether any given figures are actual or plan data, costs or revenues. The IBCS-compliant design of charts and tables can be derived directly from this. If, as Corporate Planning does, you then also recommend an appropriate chart type for the respective management analysis, you’re already pretty close to achieving the vision of automated visualization.
Dr. Jürgen Faisst is on a mission to enhance the legibility of reports, presentations and dashboards by applying a consistent visual design. He shares his extensive knowledge of planning and reporting, acquired over many years as the CEO of software houses and consulting firms, as an instructor and as a speaker at international conferences. The accomplished notation expert has been Managing Partner at the HICHERT+FAISST IBCS Institute since 2014. Since 2016, he has also been Managing Director of the IBCS Association, a not-for-profit association that supports the promotion, maintenance and ongoing development of the IBCS standards.