by Emily Chan
The two kinds of storytelling, rational and emotional, actually reinforce each other. An emotional story with no facts will not be credible, and will not drive any significant business decisions and actions. On the other hand, a factual story with no emotion can be dry (see how my COO fell asleep), easy to forget, and weak in creating a deep buy-in in the audience, as explained by sociologist Andrew Greeley: “(Emotional) storytelling is so powerful because it short-circuits dull, factual discourse. Storytelling makes a leap from the imagination of the storyteller to the imagination of the listener, from the memory of the presenter to the memory of the hearer, from his life to the lives of his audience, from his stories to their stories.”6
Therefore, nowadays, I always try to combine the two. I will weave emotional stories into factual stories. I will also try to weave facts into emotional stories.
Detailed Practice
I once had coffee with my favorite professor at HBS. I told him, “I really enjoy your class. The discussions are always guided to review the key learnings with a ‘wow’ effect. Your jokes are always funny, insightful, and memorable.” He answered, “Thank you. I practice hard, especially my jokes.” I thought this was another one of his jokes. But I later learned that he was serious.
It was a relief for me to find out that even speaking gurus practice and rehearse to ensure smooth delivery of their lectures, presentations, or key arguments. I have made a good number of presentations and boardroom arguments in my career. I would consider myself an experienced speaker. But I am still obsessive in my practice. I rehearse aloud as if I am really making the presentations. This helps make sure I know each word I am going to say. I practice where I would pause. I practice jokes so they are inserted appropriately with the punch line delivered at the right time. Last time I made a 10-minute presentation to a client’s board of directors, I spent more than two hours just practicing aloud. I even practice aloud before important phone calls, rehearsing how to open, deliver, and close the conversations.
Before I finish this chapter, a small digression on two points I learned not from HBS but from having spent years working for a U.S. consulting firm and working with native English-speaking clients:
Non-native English accent—get rid of it. When I first joined the consulting firm about 10 years ago, I had a hard time getting to work on good projects. So after a few months, I went to talk to the vice president in charge of staffing. I still remember his exact words. “Maybe it’s your accent. You know you do not speak like an American. You have that British plus California plus Chinese accent.” I was shocked. I never even knew accent was an issue. I had top grades at Stanford and had many American friends. I interviewed and got all the job offers I wanted. Nobody ever told me about an accent problem. I went back and told some of my fellow junior colleagues. They were all appalled (or at least appeared appalled) by this borderline racial discrimination incident. One of them told me I should file a formal complaint with senior management. I did not launch the complaint, but I became much more conscious in trying to speak like an American. It was hard work, as accent is an ingrained habit. It takes much time and effort to change. Also even different parts of the United States have different accents. New York English sounds slightly different from Boston English, which sounds different from Los Angeles English.
Over the years, I have seen many cases of discrimination against people who do not speak with a perfect native accent. Even though few people would ever admit they discriminate against non-native English speakers and most know very well a non-native accent has nothing to do with intelligence, unspoken discrimination does exist. You can go to Amazon.com and find many books documenting such discrimination. Therefore, if possible, when you train yourself to speak well and you know you may have to deal with native English speakers, try to work on your accent. There are books you can read and tutorials you can attend. I also urge parents to expose their children to native English at a young age. The older a person is, the more difficult it is to change an accent.
Non-English languages—the more the merrier. I speak only English, Mandarin, and Cantonese. This is one of my biggest regrets in life. My son, who is only four years old, has been trained in seven languages. I believe, if possible, it is always good to learn many languages. First, people, especially in the United States (HBS included) and Asia, tend to have immediate respect for those who can speak many languages. Second, languages can open doors to many career options: diplomatic, high fashion (French), video game animation (Japanese), and many others.
This is a real-life story: I know a man who worked for a Fortune 100 company in its U.S. headquarters. He was an average middle manager. Then one day, he was called to a meeting with an executive several levels his superior. He was told the company was about to sign a major joint venture in Japan and they needed a representative in Japan to ensure communication with the partner. He was chosen because he was the only one in the firm who could speak Japanese. Things happened very fast after that. He ended up with a major promotion, an enviable expatriate package, and an important job. This is more or less because he was the only one in the company who could speak Japanese. This example is always on my mind when I mentor young people to learn as many languages as they can. I also advise parents to expose their children to many languages before the age of six. Research has shown that children can learn languages very easily without an accent then, and find it much harder later.
A PICTURE IS WORTH A THOUSAND WORDS
Visual aids are important tools for rational storytelling. And even though visual aids can be product samples, mockups, three-dimensional models, and video, the most common type still seems to be PowerPoint slides.
With the case study method, neither professors nor students have to make many full PowerPoint presentations at HBS.7 Therefore, the skills I have are from my consulting days. I have used these skills a few times at HBS, once for a full presentation and occasionally for presenting supporting evidence for my class comments. Some of my HBS friends have found the skills useful. Therefore, even though I did not learn these skills from HBS, I thought it would be useful to discuss them here.
Three key skills go into making effective PowerPoint slides:
Organizing individual slides into a smoothly flowing presentation that the audience can easily follow
Designing individual data slides
Designing individual text slides
Flow
One easy and effective way to organize the slides is to follow structured logic. Using the example “I have three favorite pets” from the “Structured Logic” section of this chapter, the first slide would look like Figure 3.1.
Sometimes, you may put some overview slides like a table of contents or discussion of the context up front. But this slide is the first “content” slide. With this slide, you have established the structure of your presentation. It is clear where you are going.
The rest of the presentation flows from this first slide. Each of the points on the first slide becomes a section of the presentation. For example, the first section to follow will be on Milo, possibly with the next slide looking like the one shown in Figure 3.2.
Figure 3.1 PowerPoint Introduction Slide
Figure 3.2 PowerPoint Section Slide
Each of these points, in turn, becomes a data slide, a word slide, or a subsection. For example, see Figure 3.3.
For longer presentations or presentations with more complex logic, it is often useful to put icons in the top left or top right corner of each slide to help the audience follow the flow. For example, see Figure 3.4.
In these figures, the first slide is the conclusion of the whole presentation. The first slide of the first section is the conclusion for that section. Unless there is a reason why the audience has to be kept in suspense, I usually prefer to start business presentations with the conclusions. Whether people agree with the conclusion or not, declaring the conclusion up front helps the audience understand and follow the structured logic. It is also easier
in case the presentation has to be cut short or rushed as a result of digressions or emergencies. Even when the structured logic is deductive, I will still show the conclusion first and then the logic leading to the conclusion.
Figure 3.3 PowerPoint Subsection Slide
Figure 3.4 PowerPoint Introduction Slide with Orientation Block
Data Slides
There are two major types of slides: text slides and data slides (which feature little or no text). The key to a data slide is the art of using the most appropriate charts or graphs to analyze and display data. All standard graphs and charts, such as scatter, bar, stacked bar, and so on, can be useful depending on the data and analysis. Instead of going through a laundry list of basic charts, here are four of the nonstandard ones that I have found most useful in my career for generating insightful analysis and impressive visual aids:
Matrix
Moon chart
Cascading chart
Area chart
Two-by-Two Matrix
A matrix is a powerful analytical tool and visual aid. Especially at the two-by-two level, which is the most common choice, it is simple yet very effective. It can be applied whenever the outcome of a certain issue depends on two critical factors or drivers, with each of them having two key options, categories, sets of outcomes, parameters, or whatever.
Example One: Figure 2.1 sets out the basics of the interests involved in the Sky/BSB negotiation for control of British satellite television, where the financial consequences depended on the decision by Sky and BSB. Each company had binary options: fight or exit. Hence a 2 × 2 matrix is an effective way for analyzing and displaying the situation.
Example Two: Perhaps one of the best-known two-by-two matrices is the growth-share matrix first published by Bruce Henderson, founder of BCG, in the 1970s. The matrix is still widely described in business books and taught in business schools. Though it was not explicitly taught at HBS, it was referred to in many discussions. However, it must be noted that its application to today’s business could be tricky and sometimes subject to debate beyond the scope of this book. I include it here as a classic example of the two-by-two format rather than as a business concept.
Figure 3.5 Henderson Growth-Share Matrix
The matrix was first intended to be used by multi-business corporations to view their portfolio. The matrix says that free cash flow of a business is driven by two key factors: market growth and relative market share of the business.8 Conceptually, it looks like Figure 3.5.
If a business has high relative market share in a low-growth market, it is expected to be a “cash cow” because it generates cash in excess of what is needed to maintain market share. If a business has high market share in a high-growth market, it is a “star” because even though it will require cash to sustain its growth, it will eventually become a cash cow when growth stabilizes. Low share and low growth indicates a “dog”—a poor prospect—as cash generated is more than used up to maintain share. Lastly, low share, high growth is a question mark as it can become star, cow, or dog.
Figure 3.6 illustrates the matrix with data.
To make this scatter graph into a two-by-two matrix, the graph needs to be divided into four quadrants by adding two lines: a horizontal line dividing high growth from low and a vertical line dividing high share from low. This can be tricky and depends on factors including industries, geographies, company situation, and judgment, all of which affect cash generated and cash needed for reinvestment. However, as a rule of thumb, a relative market share of 2x is considered high and stable (at least for fast-moving consumer goods) and a market growth of 10 percent or above is generally considered high.
Figure 3.6 Data for a Growth-Share Matrix
* Relative market share is drawn on log rather than linear scale so that equal distances represent an equal percentage increase (for example, the distance between 10× and 1× is the same as the distance between 1× and 0.1). It addition, the smaller numbers can be displayed clearly.
It is often useful to add a third dimension to scatter graphs. The size of each data point on the graph can be drawn to scale relative to the importance of that point. For growth-share matrix, this is often the revenue size, as shown in Figure 3.7.
I have found that this added dimension is useful not just for two-by-two matrices but also for scatter graphs in general. Knowing the relative importance of the different data points helps you prioritize and make decisions. In addition to revenue size, net profit size or contributions or other relevant quantities can also be used. The choice depends on what data you can get, and of that range of figures, what best indicates importance. However, it must be noted that it is the area of the circle, not the radius or diameter, that should be drawn to scale to for the measure in question. This is because the circle area gives the visual impact of the relative size of the various data points. Using radius or diameter will greatly exaggerate differences.
Example Three: This third example is described in detail in Appendix A of this book. It is a two-by-two matrix I designed for a client to monitor the success (and failure) of tenants in the shopping mall properties of a company. It turns out that retail tenant success is driven by sales per square foot of store space and the rent the store owner pays as a percentage of monthly sales. The higher the former and the lower the latter, the more successful the tenant is, as shown in Figure 3.8.
Figure 3.7 Three-Dimensional Matrix
I use this as a third example because it demonstrates how the two dividing lines, vertical and horizontal, can be drawn based on company and industry characteristics as well as creativity. I used dots instead of drawn-to-scale circles here because the intended user seemed likely to find the additional dimension (circle size) too complicated. Also, the tenants tracked on the matrix were very similar in size.
Example Four: Beyond two-by-two, you can have two-by-three or three-by-two or three-by-three matrices and so on. As an example, Figure 3.9 shows one of the best-known three-by-three matrices, the industry attractiveness-business strength matrix developed jointly by General Electric and McKinsey and Company back in the 1970s and early 1980s.
Again, I use this example here not to explain how to apply this specific theory but to illustrate how three-by-three matrices can be used. But three is about the limit. People do sometimes use four-by-four or even larger matrices, but I find such matrices too complicated. You will usually have better ways to analyze and display the issue when a large matrix suggests itself.
Figure 3.8 Setting the Matrix Dividers
* These have low sales but rent is still quite low for the tenant’s overall financials. The tenant has healthy financials but may not be maximizing the sales (hence rental) potential of the space it is occupying. Therefore, it is important to understand the reasons behind its place on the chart.
Figure 3.9 Three-by-Three Matrix*
* Placement of businesses within the matrix provides an analytic map for managing them. For businesses above the diagonal, a company may consider pursuing strategies of investment and growth; those along the diagonal may be considered for selective investment; those below the diagonal may be best sold, liquidated, or run purely for cash.
The key here is practice. Next time you are trying to solve a complicated issue or writing a presentation to articulate your thoughts, I strongly encourage you to consider putting the ideas in a matrix. Even if eventually you find that it does not apply well, the practice will help you master this versatile tool.
Moon Chart
Moon charts are useful when you have a list of items and need to rank them. For examples, see Figures 3.10 and 3.11.
The moons are circles that are shaded differently to symbolize different rankings. The examples show two of the possible applications of moon charts:
When an “item” needs to be assessed. In Figure 3.10, the item is a slide. The item can also be a product, a service, an acquisition target, an industry, a staff member, an issue, or any other thing you can clearly define. To ensure a
systematic and credible assessment, a list of criteria is generated based on valid sources. The moon chart allows the list and ranking to be clearly displayed.
Figure 3.10 Moon Chart 1: Slide Evaluation Criteria
Source: Expert interviews.
Figure 3.11 Moon Chart 2: Customers’ Purchasing Criteria
When a list of factors needs to be credibly prioritized. In Figure 3.11, a list of possible consumer purchase criteria is prioritized by using consumer survey data to identify the ones that are most important.
Three points to note when using moon charts:
It is advisable to organize the list in a logical order: descending order of importance, chronological order, or whatever seems appropriate. I have found this useful as a discipline to ensure better organization of any list, both for analysis and for presentation to audience.
Some people may prefer to use numbers (1, 2, 3), check marks (such as ) or other symbols instead of the moons. In general, I prefer using moons because I feel they have a strong visual impact. They are especially appropriate where rankings are somewhat subjective rather than hard data.
Sometimes in addition to full moon, half moon, and blank moon, charts can also have quarter moon and three-quarters moon when more rankings are necessary. When the full moon is defined as top ranking, the different shadings make it easy for the audience to see if top ranking is almost achieved (three-quarter shading) or not (no shading or one-quarter shading).