Indeed, institutions increasingly want face-to-face
contact with management.
There is no doubt the investor presentation plays a
major role in how a company is viewed by the investors.
Yet we never cease to be amazed by the poor quality
of many investor presentations. Here are the most common
faults.
'If you fail to prepare, you are prepared to fail.'
This old adage is as true as it has always been. So
why is it so many presentations look as if they have
been thrown together the night before on the executive
jet? And the lack of preparation is often reflected
in the share price later. Since your company has put
so much work into producing results, it seems a real
shame to let it all go to waste by presenting them poorly.
"Um.. I'm here to ..erm talk to ..um you ..about
our um..." Many people are afraid of public speaking,
and this will only be compounded further by a lack of
preparation. To the audience it comes across as nervousness
or even an indication that the speaker has something
to hide. Many senior executives now use voice coaching
to develop a powerful and relaxed manner. They not only
feel more at ease when presenting; they also find that
audiences hear more - and believe more - of their messages.
If your presentation has a lot of money hanging on it
- consider getting yourself some voice coaching.
Most people use bullet points to present. They are
easy to produce and change, but they are not very interesting
for the audience. Dilbert sums it up well: 'PowerPoint
Poisoning'. According to psychologist Albert Mehrabian,
55 percent of information conveyed in a presentation
is visual, 38% is vocal and only 7 percent is text.
The power of visual images is also backed up by research
from UCLA showing that after three days bullet points
have only a 10 percent message retention while visuals
have 50 percent. A picture really is worth a thousand
words.
When people do use visuals, it is often spreadsheets
or complex charts. But with so much information on the
screen it is hard to understand the point the speaker
is trying to make. The spreadsheets are probably old
news from the financial release anyway. A much better
idea is to concentrate on the highlights and to use
visual images to support the messages.
Perhaps the best investor presentation I have seen
was by an oil company CEO. He began, 'We are currently
two years into our five-year transformation strategy
and we are, more or less, on target.'
He did not deliver great financial results but still
clearly showed how the company was on track with its
strategy. I see many presentations in which strategy
is left to the last two slides. If a company does not
clearly sell the strategy to the audience in an upfront
way, what chance does it have of selling it to the people
who are really going to make it all happen - the employees?
Many analysts play 'spot-the-difference' with investor
presentations. They look back at their notes from last
year and compare them with this year's presentation.
Make sure you make this comparison before the analysts
do, and seize the opportunity to point out changes in
your goals and means of meeting them.
At one company presentation they talked of 'quarter-on-quarter
revenues up by 6 percent' and 'data sales up by 19 percent.'
It sounded great. The reality was the business was seasonal
and year-on-year sales were down 9 percent. The stock
got punished in the following day's trading. Analysts
are smart cookies and often study your results even
more keenly than you do. As ever, honesty is often the
best policy.
There you have it - the seven deadly sins of investor
presentations.
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