Pete’s Blog

Show Notes: Ep. 85 – Merle Heckman: Intentional Storytelling & Applying it in Business

Today’s guest, Merle Heckman, truly understands the power of storytelling – and why it is needed in all aspects of business today.

You see, Merle works with engineers, but he’s not an engineer (he’s the Manager of Organizational Development at Regal Beloit). And when engineers give presentations, they can be dense with jargon and hard to understand… not unlike when accountants give presentations.

Merle wanted to know how individuals within his organization could give better presentations so that the people listening could better retain and use the information being presented.

So, for his doctoral degree in Educational Leadership, he performed a study and wrote a dissertation titled, “Intentional Storytelling: A Potential Tool for Retention and Application in Business.”

The research was fairly simple:

•There’s a monthly divisional meeting at Regal Beloit. Every other month, Merle coached the speakers on incorporating storytelling into their presentations, and they did this for four months. So the first month was normal, second, coached, third normal, fourth coached.

•After every meeting, Merle sent two surveys: one two days after, and one two weeks after. The first survey asked questions related to retention, and the second survey asked if they had applied the information, or put it into practice.

And the results are astonishing:

•When the presenters incorporated storytelling techniques, participants put the information into practice 2.5x more often than when the presenters didn’t.

•When comparing the first presentation (no storytelling) with the second presentation (with storytelling), participants retained twice as much knowledge when there were stories. When comparing the third presentation to the fourth presentation, participants retained 81% more knowledge.

“In the business context, the story teaches. We learn how to do things … The story resonates with us in such a way that it really reaches in and it really appeals to us.” Stories give presenters the opportunity to put specialized knowledge into a context that everybody can understand.

And if the term story seems daunting, Merle sometimes uses the term “homespun illustration.” The important thing is that we’re not talking about making things up; We’re talking about taking real-life events and real-life situations so that you can draw similarities (or create analogies) to the truth that you’re trying to give, and reinforce it.

So what type of stories should a presenter tell?

1. “The best stories are the ones that come from our lives; The best stories are the ones that we have lived.” There are so many stories out of our own personal lives that can affect, inspire, educate, guide, and teach people.

2. “The second best stories are the ones we have observed in other people around us. You don’t have to say the person’s name, but explain how they solved a problem. Those make great, relatable examples.”

3. “The third best stories are the ones that we read about in books, or from history, that are true to life. These are often stories about how the Lincolns and Jobs of the worlds solved problems.”

Don’t make any mistake: Teaching with storytelling isn’t easy – but it is incredibly effective.

In a world with so much information, in a world where everybody has a screen captivating their attention, the story will distinguish you as being different.

So put in the work to craft a good story – and, more importantly, practice so that you can effectively deliver that story; “Greatness is not in the performance. Greatness is in the preparation.”

Click here to listen to the entire episode.

If you want to learn more about business storytelling, my book, Tell Me in Plain English: Taking the Numb Out of the Numbers, will be available in Spring 2018.  Please visit my website and explore the ways I can help you and your organization grow through the power of improvisation.

The Dark Side of Storytelling

Storytelling, when used for good, will help grow your business, your reputation and your brand. However, when storytelling is used to deceive or to commit fraud, it will ultimately crush your business, your reputation and your brand. That crush may also come with the potential of spending time where orange is the new black, aka, prison.

Think about some of the greatest fraudsters of all time – Madoff, Ponzi, The Wizard of Oz. The one thing they had in common: They all told a compelling story. But when you pulled back the curtain, you found a complex house of cards that could not stand up to scrutiny. There are many instances where corporate storytelling did significant damage to the companies and their brands. Three of my favorite examples are Enron, Theranos, and JCPenney.

In the book, What’s Your Story?: Storytelling to Move Markets, Audiences, People, and Brands, the authors discuss the “Ken Lay Story.” Ken Lay was the son of a poor Baptist preacher in the small town of Tyrone, Missouri. Through hard work and dedication, he became a naval officer, earned his doctorate in economics, was the chief economist at Exxon, was a federal energy regulator and then became undersecretary for the Department of Interior. His successes led him to be the founder and CEO of Enron Corporation.

Ken Lay’s story is a classic story. A poor person living in small town USA, fighting against all the odds to become one of the most powerful and wealthiest men in the energy industry, whose company at its peak had an estimated market value of $70 billion. That was before its collapse. In this story, the early hero is Ken Lay, and the villains are the number of obstacles he had to overcome in his rise to power.  However, when Mr. Lay’s moral ethics shifted, his company failed and he went on to become a convicted felon. The hero become the villain.

In a Harvard Business Review case study, A Tale of Storytelling: Its Allure and Its Traps, discusses that it is the departure from the truth that makes the story the winner. This divergence is reflected in the story that Enron was using when their business model changed from pipes-in-the-ground oil drilling to natural gas and commodities. This story was so incredibly compelling that Fortune magazine named Enron “America’s Most Innovative Company” for six years in a row. Innovative maybe, but not the truth.

What’s Your Story? discusses the difference between “truth” and “true.”  They use an example of Procter & Gamble and their detergent, Tide. A P&G research scientist sitting in the lab used expensive equipment to prove that Tide cleans laundry better than the competition. That is the true statement. However, laundry rooms throughout the United States do not come staffed with scientists or expensive equipment; those who purchase laundry detergents make a decision about which brand to purchase based on what they believe is the truth. In most cases, the truth is derived from an advertisement that might state “my clothes are cleaner when I used Cheer versus other brands.” In other words, corporate storytelling is about truth statements rather than true statements.

Another What’s Your Story? case study highlights what happened to JCPenney from 2011 to 2013. In 2011 JCPenney hired Ron Johnson, the former senior vice president of retail operations at Apple Inc., to be their next CEO.  Ron’s story was one of transformation, bringing the brand back to its original stature as a leading department store. He was going to fix JCPenney’s complex pricing structure, attract both the millennial generation and a more affluent customer base, and create new, exciting shopping experiences. His “truth story” was so compelling that it convinced company stakeholders, many on Wall Street and celebrities like Ellen DeGeneres and Martha Stewart who added their names and product lines to the transformation.

Unfortunately, Ron forgot to take into consideration his existing customer base which was, in fact, almost the exact opposite of the customer demographic that would respond to the new and improved JCPenney. He was telling the stakeholders what they wanted to hear, but forgot to include one true statement about the current customer base: They were middle-of-the-road bargain shoppers. Because of the unrealistic expectations, he was not only unable to attract the young and the rich as customers, he also alienated the true JC Penney’s customer. In 2013, sales dropped 28%, the company’s revenues declined by $1 billion and the stock price was half of what it was before Ron’s vison. No surprise, Ron was fired.

In the Harvard Business Review article titled, Theranos and the Dark Side of Storytelling it discusses Elizabeth Holmes, who is the founder of Theranos. Theranos is a blood testing company that touted technological advances in blood testing. They claimed they possessed the technology to test a wide variety of diseases from a small amount of blood drawn from a pricked finger. Elizabeth’s story is compelling because she was and extremely bright 19 year-old student at Stanford University who dropped out of school to found Theranos. According to the article, her vision was to save millions of lives around the world through her technology.

Her story and her mission were so compelling that in 2015 her company was valued at $9 billion and Forbes magazine named her the youngest self-made female billionaire in the world. Her storytelling was so convincing that she recruited well-known political types, such as Henry Kissinger, George Schultz, Sam Nunn and Col. James Mattis, to be on her Board of Directors.

In October 2015, the Wall Street Journal reported that the company’s blood testing technology was a near-total failure. According to an exposé in Vanity Fair, the Elizabeth Holmes story was told and retold so many times that it became more the story of innovation and female empowerment than the story of Ms. Holmes. The company was founded on the story, and based on current evidence, the story is fictional at best.

The Enron and Theranos situations were deliberately concocted to deceive and defraud an organization and its investors.  JC Penny’s situation is different because there was no ill-intent.  It was the new CEO’s vision on how to transform the business that blinded people.  Actually, the fault lies with the JC Penney Board of Directors who was enamored by the new story. They didn’t analyze the story they loved against the facts they knew to be true in order to determine how this new vision of the company would affect their business and customer base.

It’s time we all recognize the stories behind actions, and how their compelling nature draws us to them.  We must ask questions and determine the real character of those actions and whether they stand up as the truth. Even the story Ken Lay finely crafted for Enron had cracks that should have revealed the fraud. In fact, there was one investor who didn’t invest a dime into Enron and was even chastised in financial periodicals and by pundits for his decision. That investor was Warren Buffett. The reason he did not invest into Enron was that he could not make sense of Enron’s business model and how it related to the company financial statements.  His logic superseded his emotions in his decision-making process. Reason prevailed, and Buffett came out ahead.

We all love a good story, especially when told by a gifted storyteller. The onus is on us to validate each story through a thorough vetting process.

Storytelling in Business is a Great Strategy

Storytelling in business can be a rather misunderstood process. If you think business storytelling is like telling fairy-tales, think again. I’m not talking about stories like Jack and the Beanstalk, Little Red Riding Hood, or Sleeping Beauty. Every day we are exposed to storytelling from major companies and their brands through commercials, ads, and online messages. Even product packaging tells a story. If you’ve ever watched a Super Bowl you have participated in one of the best examples of this kind of storytelling. Those commercials are designed to tell stories that connect on an emotional level with the viewer to drive buying habits. Telling stories in business is big business.

Do you remember the ad that ultimately changed the way Super Bowl commercials were designed and developed? It was Apple’s 1984 commercial introducing the Macintosh computer, and it revolutionized the way companies advertise. It was so innovative that Advertising Age, the “bible” for advertising agencies, named this commercial number one on its list of the greatest 50 commercials of all time. Without using a competitor’s name or even showing the new Macintosh, Apple told their story: IBM dominated the market, controlled its customers, and Apple was going to give them a run for their money. They tied it all back to George Orwell’s book 1984 and created a visual message that was disturbing and memorable. At his keynote address to Apple in 1983, Steve Jobs told the same story. IBM wanted it all and had aimed its guns at the last obstacle to industry control: Apple. Will Big Blue (IBM) dominate the entire computer industry? The whole information age? Was Orwell right about 1984?

Take a journey through YouTube and search for the top Super Bowl commercials of all time. Each one of them has some emotional effect on the audience. A few of my favorites are Pepsi’s commercial featuring Cindy Crawford, the Coke ad featuring Mean Joe Greene, the McDonald’s commercial featuring the showdown between Larry Bird and Michael Jordan, and the annual adorable Budweiser puppy.

A researcher at John Hopkins by the name of Keith Quesenberry predicted that the Anheuser-Busch puppy love commercial would be the winner of the best commercial in 2014. He and his research partner Michael Colson studied brands that sold products featuring cute animals or sexy celebrities. In a Harvard Business Review article titled The Irresistible Power of Storytelling as a Strategic Business Tool, Quensenberry states “that ads that told a complete story using Freytag’s Pyramid which is a storytelling structure that can be traced to ancient Greece.”

As outlined in the HBR article, the components of Freytag’s Pyramid are much like a five-act play which are:

Act 1 – Exposition: setting the scene by the introduction of characters and the setting.

Act 2 – Complication: conflict is introduced, and this conflict continues to build.

Act 3 – Climax: the height of the conflict and tension and this is where the story is at its most exciting.

Act 4 – Reversal: the main character begins to resolve the conflict.

Act 5 – Denouement: the conclusion of the story.

When stories follow this path, it creates a strong emotional response in our brains. Research shows that during tense moments in a story, our brain produces a stress hormone called cortisol, which allows us to focus. During cute moments of a story, our brain releases oxytocin, the chemical that elevates our connection and empathy. During happy moments our brains release dopamine, which makes us feel optimistic.

Storytelling and the chemicals that are released in our brains, also help to open our wallets and buy products from companies or give to charities, help us to change attitudes and beliefs, help us to empathize with others, and help us in the learning process by increasing retention and understanding.

The next time you prepare to engage with an audience (and the size of that audience can be from one person to a thousand people), craft your information into a compelling story. You will increase your success whether it’s a donation to not-for-profit, or buy a product from a company, or land that prospective client. Take the data that you have and apply the theory behind Freytag’s Pyramid to develop your compelling message through a story.

Knowing Your Audience: The Four Stages of Competence

Before developing a presentation you need to know your audience – what is the baseline for their current understanding of your topic. Try to determine what level of competence the audience possesses because it will have an impact on how you structure and deliver your presentation. I remember once when I was a staff accountant one of the senior managers was trying to explain a complicated concept to me. I just couldn’t quite grasp what he was talking about. My technical knowledge was not at his level, and he was not communicating with me at a level of my understanding. Both of us left that conversation frustrated.

Development of the four stages of competence occurred in the 1970s at Gordon Training International, a well-respected education and training consultancy. As a point of reference, this competency model has been attributed to Abraham Maslow but has not been found in any of his work.

The four stages of competence are:

  1. Unconscious Incompetence: The person doesn’t know what they don’t know, you know. An example of this is a new employee who recently graduated from university with a degree in accounting. They may have taken an auditing class, but they don’t know how to audit. They may have taken a taxation course, but they do not know how to fill out a tax form. The person just doesn’t recognize that there is a gap between what they know and what they need to know. The only way to move to the next level is for them to recognize their incompetence to the skill and have the desire to acquire the knowledge to master it.
  1. Conscious Incompetence: When someone begins to increase their standard of competence through repetition and practice, they move into the Conscious Incompetence quadrant.  They know that making mistakes and errors are integral to this learning process. For example, the new associate is learning about the auditing process by learning how to reconcile bank statements and receive feedback on their work. Feedback is critical to the learning process but when taken too personally can bruise some egos. That can create a negative mindset if not presented properly. It is the responsibility of the supervisor to deliver feedback in a positive light to avoid the negative mindset.
  1. Conscious Competence: Now the individual begins to have a deeper understanding of the skill necessary and can execute it with minimal errors. They have acquired the skills to be competent in their current role and have shown the ability to continue learning. It’s at this level where they may be a candidate for promotion. In the advancement process, part of the individual’s skill will revert to the unconscious incompetence.  Perhaps they are promoted on their increased technical knowledge but are still lacking the skills to manage a group of people.  They don’t know what they don’t know.  From previous experience, they should recognize this new knowledge gap and begin the process of closing it. Mastering each knowledge gap will help them accelerate to the next level.
  1. Unconscious Competence They made it! At this level, the person has extensive exposure to multiple facets of the business and, through practice, the skills needed to succeed are second nature to them. I tend to equate this to the job positions of chief financial officer, a partner in a firm or chief executive officer. With extensive depth and breadth of knowledge, solving issues becomes more intuitive. The lessons learned along the way are a point of reference for finding solutions.

Here’s another example I like to use: a golfer. The unconscious competence golfer is the one who is currently on the PGA or LPGA tour. They don’t have to think about the basics of golf: stance, grip, swing, etc. They visualize the shot, consider all variables than just swing the golf club with perfect tempo and rhythm, hitting the ball almost to perfection. Well, most of the time.  They maintain this level of excellence with consistent practice, and that is the key to remaining unconsciously competent.  Without regular practice, the person will drop back to the third stage.

Understanding your audience’s level of competence allows you to tailor your presentation to meet or slightly exceed the audience’s level of expertise. That alignment of what they know and what you are sharing allows you to create a conversation with the audience. When you connect with the group they are more likely to retain your message and be able to act on it. However, if we are talking about complex issues that the audience cannot relate to them, all we are doing is just talking over their heads.

We’ve all been in presentations where the presenter delivers highly technical information, using insider jargon and unrecognizable acronyms. The audience has deer-in-the-headlights looks, and are not engaged with the speaker, let alone having a conversation.  Tailor your presentations to meet the competency level of the learner. If you talk about any issues that the audience does not relate to, all you are doing is talking over their heads.  You’ll have greater success in connecting with them and raising their level of retention.

Two Memory Techniques to Help Create a Conversation Experience

There are critical achievements that all professional speakers share. You want to be recognized as a subject matter expert in your field. Someone who is a polished speaker, who creates a “conversation experience” and connects with every person in every audience. You want to be the best, and you can achieve those goals. But you need a strategy. One of the strongest strategy techniques for creating conversation experiences with audiences is a form of memorization.

I don’t mean memorizing your entire presentation, repeating it verbatim or reading from a slide presentation. This strategy does involve some actual memorization but also visualization and memory triggers. Fair warning: This technique takes practice.

To begin to learn this technique, write the opening and closing paragraphs for your presentation. They must be meaningful for your audience. You want to grab their attention in the beginning and offer a call-to-action when you close. Then memorize those two paragraphs word-for-word. Practice them until you are able to deliver them perfectly. Knowing your opening paragraph by heart can help calm your nerves which helps increase your level of confidence. Memorizing your closing paragraph will help you “stick the landing” and end your presentation on a high note. Your call-to-action is the key message point, the seed, you have been planting throughout your presentation.  You want the audience to remember it, and act on it.

Now it’s time to learn and incorporate advanced memory techniques.  The method that many speakers use is called the memory palace, and includes the use of mnemonics. We all have used mnemonics to learn new and sometimes complex things. Who doesn’t remember learning the alphabet by singing the ABCs? That’s mnemonics, and it is used to develop your memory palace.

The memory palace “is an imaginary location in your mind where you can store mnemonic images. The most common type of memory palace involves making a journey through a place you know well, like your home or office. Along that trip, there are specific locations you always visit in the same order.” These places are where you put the mnemonic images you want to remember. It’s not as difficult as it sounds. Here is how you build your memory palace.

  1. Become an architect and decide on the blueprint for your memory palace.  Personally, I find that using my home’s design is the best – I have lived in the same house for over 20 years.  I am very familiar with the layout and navigating through the house is intuitive, I don’t have to think about it.  Draw your blueprint on a piece of paper showing all the major rooms, entries and exits. You will add details to this blueprint as you develop your palace.
  2. Look at your blueprint and decide on the route you will take every time to get from the entry to the exit.  Be deliberate in your path and create a logical route through your memory palace.
  3. Now memorize the route you will consistently take. For example, I enter my memory palace through the front door of my home, move into the hallway, then head to the family room, then to the kitchen, then to the living room and leave through the back door.
  4. Make a list of the key points in your presentation that you want to remember and list them in the order that you want to present them.
  5. Place one presentation key point in each particular location in your memory palace; actually write that point on your blueprint.  Then list two words that are specific details related to your key points in each location.
  6. Create a mental image of each of your key points and exaggerate the picture to help in memorization.  The use of humor in the exaggeration will help you remember the point you want to make a lot easier.
  7. Then begin to practice by visualizing your path through your memory palace and bring in mnemonics to memorize the list.  Many practice runs will be needed to train your memory and capture your entire presentation.

Put these two memorization methods together and run through your presentation.  Your opening paragraph is represented by the front door, and your closing paragraph is where you exit the building. When you visualize your path through the building, think about the mnemonic memory of the key points and what you want to say about them. Practice your presentation using this method until you comfortable move from the entry to the exit. Keep your blueprint handy as a reference tool so you stay on the planned route through your memory palace.

The day of your presentation, take your written memory palace with you, and put it in a place where only you can see it, maybe on a podium. Use it as a backup plan to keep you on track, just in case you forget where you are in your presentation.

You many need to invest a considerable amount of time to get comfortable with the memory palace method but there is a big payoff: You can move from a lecturer to a conversational presenter.