How to Communicate with Numbers
By John Millen
Many of my clients are analytical experts in complicated industries, such as insurance, financial services, consulting and technology.
They range from CEOs to data scientists to financial analysts, who all have one thing in common: they have a hard time getting people to understand the data they present.
That’s usually where I come in, helping them clarify their data to make their points, and tell their stories.
But it’s not their fault that people don’t understand the numbers. It’s how human beings are built.
This frailty of human understanding is underscored by a fantastic new book: Making Numbers Count: The Art and Science of Communicating Numbers, by Chip Heath, a Stanford Business Professor and science writer Karla Starr.
“Numbers aren’t the natural language for humans,” the authors say. “If you’re filling in databases, it’s fine to leave numbers as numbers, but the second you want to use numbers in an argument or presentation, it’s your job to put them in human terms.”
In fact, it’s helpful when you talk about numbers to think of yourself as a translator. You’re communicating in a different language so you concentrate on helping your listeners understand the meaning of your numbers.
Investor Warren Buffett believes so strongly in communication that he calls his development of these skills his “best investment.” In fact, Buffett tells college students they’ll earn 50% more income over their lifetimes if they learn effective communication skills.
That’s why it’s critical for you to interpret numbers for people.
Citing a research study, the authors note that “by putting a little thought into translation, accuracy essentially doubled. That’s an eye-popping effect.To put this in perspective, imagine what a CFO would pay to have their key metric recalled twice as much by investors on earnings calls…”
Translating numbers also builds and maintains a connection with your listeners. “When people don’t ‘get’ a number, they not only miss the number itself but they also…may tune out and miss the message. Worse, they may even tune you out, because you’ve failed to build rapport and make them feel included.”
Being clearer with numbers might also help you to stop talking so much.
Here are a few examples:
- In many cases, it’s more effective to avoid numbers entirely. The authors cite a 2018 New York Times article noting the very small number of Fortune 500 CEOs who are women:
Among Fortune 500 CEOs, there are more men named James than there are women.
- Another example is explaining the Six Sigma business process that allows only 3.4 defects per million objects.
Instead: To achieve Six Sigma as a baker, imagine baking a batch of 2 dozen chocolate chip cookies every night. You could do that for 37 years before finding that a cookie is burned, raw, or doesn’t have a perfect number of chips.
- My own example is from my article How Boeing Ruined its Reputation for Safety, “Some 170 737 Max 8’s were in service. Two had crashed. In other words, more than one percent of this new model had fatal crashes. Yet, Boeing and the FAA continued to echo their message that the Max 8 plane was safe.”
This great book offers many strategies and specific tactics for presenting numbers. Here are three rules from one of the chapters:
Rule #1. Simpler is Better: Round with Enthusiasm.
We learn rounding when we’re first trying to get the hang of math. Then we tend to forget it, as we get addicted to calculators and spreadsheets.
4.736 is about 5.
5/11 is about half.
217 is about 200.
Rule #2. Concrete is Better: Use Whole Numbers to Describe Whole Objects, Not Decimals, Fractions or Percentages.
...anytime we give our audience figures that aren’t whole numbers, the message is unlikely to make sense to them. Not only are they prone to make errors remembering and calculating the numbers, but there’s a good chance they never even envision what we’re describing in the first place––because the number attached isn’t solid.
The authors give the perfect example: when Alfred Taubman was the CEO of A&W restaurant, the company decided to one-up McDonald’s by offering a third-pound hamburger for the same price as the quarter-pound burger at Mickey D’s.
Unfortunately, A&W customers were outraged! Why was the company offering a smaller burger for the same price? Their fans didn’t realize that a third-pound is larger than a quarter pound.
Simple numbers are better.
Rule #3. Follow the Rules But Defer to Expertise. Rules 1 and 2 May be Trumped by Expert Knowledge.
...when your audience has specialized experience, they might develop shortcuts that change these general rules. Bring numbers into an audience’s wheelhouse and they might be capable of more precise calculations.
Serve your audience what they know, not what would be best for someone else. Normally we would never advise that someone use a 3-digit decimal to express one of the key metrics for their business, but baseball fans have developed strong reactions to the difference between a .277 batting average and a .312 average.
Dr. Chip Heath explains more about how to make numbers understandable in this interview at Stanford.
The overall lesson is that when presenting numbers your role is to help people understand the meaning of these numbers.
Consider yourself a translator of this non-native language called numbers.