Financial Intelligence

I’m going to share a little secret that many of us business intelligence professionals keep locked away from sight. Despite the fact that we spend much of our time supporting the information needs of finance professionals, we know less than we pretend about finance. Many of us have never taken a single course in finance and probably haven’t cracked a finance book more sophisticated than Accounting for Dummies. I’m embarrassed to admit that I’ve spent many meetings over the years discussing financial data, nodding as if I understand and peppering the conversation with finance terms here and there to reinforce the ruse, thankful that no one ever challenged me to define one of those terms.

I’m not completely in the dark. I understand the basics and have managed the finances of departments and of my own companies over the years, but my understanding is rudimentary and my use of the terms is shallow, which has at times elicited confused or suspicious looks from finance professionals when I must have used one of those terms incorrectly. Don’t you dare tell any of my MBA students at the University of California, Berkeley, that I’m a finance toddler. They might stop calling me professor.

If you’re in this boat with me, I want to recommend a new book entitled Financial Intelligence: A Manager’s Guide to Knowing What the Numbers Really Mean by Karen Berman and Joe Knight (Harvard Business School Press, 2006). The authors are the owners of the Business Literacy Institute and their many years of teaching people such as us has equipped them to explain the intimidatingly esoteric principles of finance in accessible terms.

If you ran across this book on the shelves at Barnes & Noble, you might have skipped right over it because it claims to be a “Manager’s Guide” and you’re not a manager. Not so fast. Most of the people that you support with financial reports and systems used for financial analysis are managers or are people who assist managers. Even if you’re not a manager, you need to understand the financial needs and interests of managers to support them and even to intelligently discuss their needs with them. If you read this book, you’ll suddenly be able to anticipate their needs, and think of how great you’ll look when you provide them with needed information before they even ask. You’ll also understand what people look for in financial data, how they use it, and why, which will enable you to design better reports, dashboards, etc.

If you’re a BI professional and don’t have a background in finance, you ought to get a copy of this book. If you’re like me, you might discover that reading it is actually enjoyable. It feels good to have the lights suddenly come on after years of living in a darkened room.

Take care,


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