While reading David Silverman’s Harvard Business Review article on good business writing, I was struck by the similarities with the best practice financial modelling methods advocated by the FAST modelling standard.
“All writing is about clarity”
The proper use of paragraphs = the proper use of calculation blocks
Silverman writes – “A paragraph can express multiple thoughts. In business writing, it should express one.” In modelling – we can put lots of calculations together in the same block, but we should not. One calculation per block.
Simple sentences = short, simple formulas
If we accept that clarity and readability are paramount in financial modelling as in business writing, the formulas should be short. If sentences become too long, with multiple joined clauses, we break them down. We should do the same with our formulas. Avoid the temptation to think that long sentences make you look clever.
Reading vs scanning
Silverman points out that business documents are scanned not read, and recommends that we make it easy to find the information using clear headings and sign posts. The same is true in models – headings and labelling are crucial when users are ‘scanning’ through the model.
What’s your view? Is good modelling like good business writing?