GDP Strong, But Jobs Data Spark Worry
August 31st, 2007 | Posted by innovTwo economic reports released Aug. 30 illustrate the old maxim that timing is everything. While the second-quarter gross-domestic-product headline figure fell short of expectations, the mix of components of the GDP release were actually stronger than expected, leaving this report, on its own, a round of good news for the economy.
But the GDP report covers the last quarter before the subprime crisis churned U.S. credit markets and sparked worries about the spillover effects on U.S. growth. Contrast that with the other major Aug. 30 release, which showed a rise in initial jobless claims in the fourth week of August. The jobless claims report appears to capture the effect of the credit-market convulsion on labor markets, giving us our first real sign of “real” effects in the August data.
One thing to note: If the claims rise remains at current levels, it probably only reflects layoffs in the mortgage industry itself and may not be particularly significant. But if the figures move higher with the Sept. 6 initial jobless claims report, they will raise the stakes for the August employment report scheduled for release Sept. 7, and ultimately, for the Federal Open Market Committee meeting on Sept. 18.
Here is Action Economics‘ rundown of the Aug. 30 data releases:
For the preliminary U.S. second-quarter GDP report, the figures revealed an upward bump to growth of 4.0% from the 3.4% advance estimate released in July. The median forecast of economists surveyed by Action Economics was for an upward revision to 4.1%.
Looking at the inflation-measuring components of the report, the GDP price index was unrevised with a gain of 2.7%, although the core personal consumption expenditure figure (which excludes food and energy prices) was revised down to a gain of 1.3% from 1.4%.
Though headline GDP growth fell short of expectations, the component mix was stronger than expected, with an overshoot of sales relative to inventories, and particular strength in fixed investment. Upward revisions were seen in net exports, inventories, fixed investment, and consumption, while government spending was revised slightly lower.
GDP growth averaged 2.3% through the first half of 2007, and we continue to expect a 2.8% pace in the third quarter. August economic data will be watched closely for clues as to the impacts of current financial dislocation, and we have thus far marked down our fourth-quarter GDP estimate to 2.8% in response to these effects. But solid growth up to August will provide a floor to any revisions to third-quarter growth, as will the strong GDP component mix that has boosted third-quarter prospects.
Initial jobless claims rose 9,000 to 334,000 (vs. economists’ median estimate of 320,000) for the week ended Aug. 25. The level is the highest since early April, when there was some upward pressure on claims due to weather and holiday distortions.
The rise in claims over the last three weeks likely reflects mortgage industry layoffs, given the lack of other fundamental factors in August, though floods in the Midwest may have been a depressing factor. These figures will be watched closely on Sept. 6, as it marks the last weekly release just before the Sept. 7 release of August jobs data. Note that even though there is a clear rise in the last three weekly figures, to the 324,000-to-334,000 range, from the surprisingly low 303,000-to-309,000 range through the July auto retooling period, the pop still leaves the level of claims close to the 317,000 average reading thus far in 2007.
The question at this point is whether claims will continue to move up to more troublesome levels or stabilize, suggesting that layoffs remain closely related to the mortgage markets and associated nonbank lending activity, rather than the broader economy, and are small in volume overall.
We have further trimmed our nonfarm payroll estimate in August to 130,000, following the 92,000 July increase, with projected job growth now lying below the 136,000 average payroll gain thus far in 2007.
Credit Crunch: Sizing Up Potential Damage
August 28th, 2007 | Posted by innovThe credit crunch is moving like a hurricane through the U.S. economy, and the markets will brace for the first insights on the damage to growth from the associated interest rate jolt.
For Action Economics‘ gross domestic product estimates, we will treat the crunch as a one-off event—similar to a storm—that will unwind as fixed-income yields drop back. Of course, if the fixed-income market correction proves late in materializing, we will push back our assumed correction and downgrade growth accordingly.
The biggest impact of the seizing up of credit markets over the past two weeks should be seen in the eye of the storm, the U.S. mortgage industry itself. New home sales posted a hefty 18% pullback in 2006, and we expect a similar decline in 2007, leaving a big hit to sales in August and September as mortgage market disruptions are likely to scuttle many real estate commitments. A similar hit is expected to affect existing home sales, which fell 8% in 2006 and should post a similar 2007 drop.
We expect housing starts to receive a jolt that should take these figures to a 23% rate of decline in 2007 and a September trough that we peg for now at a 1.25 million annual rate. Note that disruptions in the jumbo mortgage market may have had a big impact on some areas, but housing starts are concentrated in the South and Midwest where jumbo loans are uncommon, and this will also prove important to some degree for the real estate sales figures.
With these real estate market assumptions, we will continue to expect a 10% to 15% rate of decline in 2007 in most residential construction indicators, such as the monthly construction spending reports and the residential construction figures in the GDP accounts.
For the quarterly residential construction figures, we will assume 16% rates of decline in both the third and fourth quarters that are similar to the 16.3% rate of decrease in the first quarter and the 14% rate of decline we expect with the next round of second-quarter GDP revisions. At this point, we expect a fairly persistent downdraft in residential construction activity through 2007, as builders continued to take down production levels to unwind their inventory of unsold homes.
Though the bulk of the effect of the credit market crunch on GDP should be seen via housing, we might also see a pullback in big-ticket purchases by consumers in August, and maybe September, that should hold down auto sales, retail sales, and consumption growth.
For now, we will assume a repeat in August of the weak July vehicle sales rate and restrained retail sales gains of 0.3% in both August and September. Thankfully, falling gasoline prices should still allow 2.5% real growth in consumption in the third quarter, following a likely upwardly revised 1.5% rate of growth in the second, and we would expect a bounce in fourth-quarter real (adjusted for inflation) growth to about 3.5%. Note that weekly sales data have shown little disruption thus far in August, though reports indicate that vehicle sales are proving weak on the month.
The impact of the credit crunch on business inventories should be to boost levels, as sales should be more disrupted in August and September than output. This inventory bounce should follow a hefty upward revision in the second-quarter inventory accumulation rate, which partly reverses the inventory downdraft of the 2006 fourth quarter and 2007 first quarter.
We may also see the impact of the credit crunch on business confidence over the coming months. We note, however, that the commercial paper market for nonfinancial corporations recovered quickly last week from the early August jolt, and commercial and industrial loans from U.S. banks have accelerated sharply in August. In addition, capital spending plans in the August Empire State and Philly Fed surveys were solid, as were most of the other survey components and other factory sentiment reports for the month, suggesting little disruptions in business confidence at least thus far.
Business fixed investment should experience a small boost in the second quarter from upward commercial construction revisions, and we still expect respectable 5% to 6% growth in the third and fourth quarters. The solid durable goods report for July suggests a healthy trajectory for equipment spending and factory activity overall as we entered the third quarter.
In total, we will assume that GDP growth slows in the third and fourth quarters to around 2.8%, following the hefty upward revision we expect in second-quarter GDP growth to 4.3% from the 3.4% “advance” estimate last month.
Our downgrades to GDP growth in late 2007 reflect the modest impact we would assume if the credit crunch continues to unwind through the last week of August and first week of September. Of course, if the credit crunch changes course this week, with further deterioration rather than improvement, we will further adjust our GDP forecasts downward.
If the credit crunch unwinds as we assume, the Federal Reserve will experience notably reduced pressure for an outright easing in policy as we approach the Sept. 18 Federal Open Market Committee meeting, despite harsh market rhetoric to the contrary.
August 27th, 2007 | Posted by innovDurable goods orders exploded 5.9% higher in July after an upwardly revised 1.9% increase in June (1.3% previously). Orders are up 9.3% year-over-year vs. -1.3% previously.
Transportation orders jumped 10.8%, with orders excluding transportation up a solid 3.7%. Nondefense capital goods orders excluding aircraft rebounded 2.2% after two consecutive monthly declines. Shipments rebounded 3.8%, and were up 0.5% for the capital goods nondefense excluding aircraft component. Inventories were up 0.1%. The inventory-shipment ratio fell to 1.42 from 1.48 in June.
The jumbo July surge for both orders and shipments more than reversed any June disappointment to leave a trend for these figures that is right in line with the solid second- and third-quarter GDP combo that was baked in the cake through July, before the August credit crunch. Even with a likely August correction, the figures do largely ensure a good third-quarter factory sector performance.
Yet despite the fanfare, the equipment figures were only just in line with our estimates and did little to alter our overall outlook. Indeed, we knocked down our equipment and software assumption for the second-quarter GDP report later this month by $1 billion to $2 billion, though we still expect a revised 4.3% second-quarter GDP gain. We continue to assume a 2% to 3% growth clip for this GDP component in the third quarter that repeats the second-quarter performance, and leaves 2.8% GDP growth in the current quarter.
We now expect a solid 3.5% gain in July factory orders, and a 2.3% shipments gain. The 0.1% July durable inventory gain is consistent with our assumed 0.3% July business inventory increase, which follows the price-boosted gains of 0.4% to 0.5% in the three months of the second quarter. Today’s data give more evidence of downside risk in equipment spending growth in 2007 following the January and February scare, leaving a slowing in equipment and software spending for 2007 overall, but not the sharp drop-off feared at the time of the March Federal Open Market Committee meeting.
As for the aircraft subplot in the durable and factory reports, the July aircraft figures for both shipments and orders sharply outpaced their already solid performance in June, as the Boeing bounce from the June Paris Air Show was followed by an even bigger surge alongside the roll-out of the first 787 in July—which was associated with a new flurry of orders. Output figures for aircraft rose at a restrained rate early in the year but are gaining strength as we enter the third quarter. More generally, accumulated order strength over the past three years should translate to solid shipment gains throughout the 2007-10 period, with little downside risk.
Get Motivated to Do More with Less
August 24th, 2007 | Posted by innovWhen I heard former Secretary of State Colin Powell speak recently, he said, “Perpetual optimism is a force multiplier.” He explained that in the military, leaders are always looking for force multipliers, that is, ways to get more done with their current force.
Powell’s speech prompted me to brainstorm some force multipliers in sales. Here are five. If you think of others, please comment below or e-mail me.
1. Optimism: Powell’s idea applies to sales, too. This is not a big stretch because most salespeople are, by nature, optimistic. It’s a necessary trait for surviving in a career where you often get told “no” and you have to smile and keep on selling.
However, it can be a challenge to stay perpetually optimistic. One way to sustain your optimism is to keep a record of your selling accomplishments. You can also add copies of significant purchase orders, congratulation letters from your boss, or photos from celebration parties to it. Just before you go on a challenging sales call, review it to remind yourself that if you did it before, you can do it again.
Motivational quotes can also help you stay optimistic. I like “Reach for the moon. Even if you miss, you might just land on a star” and “If you think you can, you can.” They can be posted in your office or car, or you can audio-record them and play them in your car between appointments.
2. Preparation: The old saw holds that most wars are won on the drawing boards before the first shot is ever fired. Likewise, learn all you can about your customers, their company, industry, and competitors before you have your first meeting so you are fully prepared. Then stay abreast of any changes as your selling relationship spans the coming years.
Setting e-mail updates using Google (GOOG) Alerts, performing research on the Internet, and reading trade magazines are great ways to stay prepared. The information you glean can give you ideas on new offerings to propose or help you anticipate any changes that could affect your selling relationship.
3. Sales education: Your customers are constantly learning new ways to negotiate better with you. As a result, you need continual sales education to protect your sales and profit margins. Every hour you spend learning the latest in sales education will pay dividends when you are sitting on the hot seat of a sales call.
To stay sharp, check out best seller lists, go to Amazon (AMZN) and search for sales books sorted by best-selling rank, and visit your local bookstore.
4. Boldness: Jeffrey Fox, a Savvy Selling podcast guest, says that “A shot on goal is always a good idea.” In this vein, consistently take action whenever you see a selling opportunity. This is the military equivalent of the element of surprise.
One of my favorite compliments to receive is, “I can’t believe you had the guts to do that.” To be honest, sometimes I can’t believe I did either. For example, in 2001, in response to an article in BusinessWeek magazine, I wrote a letter to the editor. When BusinessWeek.com requested to publish it, I said yes—and boldly asked if they needed a sales columnist. Six years later, the site has published more than 140 of my Savvy Selling columns.
To strengthen this force multiplier, remember that it’s more important to boldly take advantage of selling opportunities whenever they present themselves than worry whether each one works out perfectly or not. The point is to practice and hone your boldness.
5. Competitive drive: Most salespeople are naturally competitive. No matter whether we develop this desire on the athletic field, in school, or in business, we are drawn to competition and we have the inner drive to win. I still remember how victorious I felt long ago when I beat not only all the girls in my high school physics class, but all the boys, too.
A headhunter I once worked with attributed his success to telling himself, “I may not be any smarter than my competitors, but I will outwork them, so in the end I will win more sales.” Maybe that idea will work for you, too.
When I feel sluggish, one of the ways I get my energy back is I picture my competitors working away at a mad pace. I know that if I don’t get back into action right away, they will outsell me. The image of them outperforming me drives me crazy and I get back to selling with intensity.
Sometimes salespeople feel stretched to continually do more with less. However, developing your forces of optimism, preparation, sales education, boldness, and competitive drive can help you perform your best and multiply your sales results. Happy selling!
August 17th, 2007 | Posted by innovWith the Aug. 17 move by the Federal Reserve to lower its discount rate 50 basis points—and its statement in which the central bank boosted its assessment of downside risks to the economy—policymakers have opened the door for the Fed to alter its policy stance.
The Fed is likely to at least shift its inflation-fighting slant to a neutral bias, in which it sees risks to the economy evenly balanced between rising inflation and slower growth, and may chose to adopt an outright bias toward slower growth. And the Fed could lower the policy target rate. But any aggressive future move is hardly baked in the cake with today’s statement, despite the wishful thinking of some observers.
Much, of course, will depend on data between now and the Sept. 18 meeting of its rate-setting arm, the Federal Open Market Committee (FOMC). Indeed, the fact that the Fed avoided referencing a new bias statement in the Aug. 17 release reflects that FOMC members are still unclear as to what the change in the bias will be at the next meeting, let alone the target Fed funds rate, which remained unchanged at 5.25%.
The Fed no doubt wants to keep all its options open between now and then—unless a specific insolvency emerges that implies systemic risk to the banking system and an associated immediate policy response. This is a key point for market players who assume that the Aug. 17 Fed statement is a signal that a policy-easing, in the form of a cut to the Fed funds target rate from its current 5.25%, is set for September.
Though the risk of Fed easing remains high as long as the liquidity crisis continues to plague the global financial markets, we will assume no policy change at ensuing Fed meetings until we see an impact on reported economic data that would likely alter the Fed’s estimates for growth. Of course, heightened financial volatility suggests that downside risks to the economy have increased. If the macroeconomic data between now and Sept. 18 track the Fed’s existing in-house projections—and there is a good chance that the figures will—then at least some FOMC members, and maybe all, will be reluctant to change the path of policy.
To be sure, a sudden financial market dislocation in the interim, especially if it threatens the banking system, could easily prompt an interim Fed easing. But until we see the current non-bank financial problems threaten bank performance overall, our assumption will be: no policy change.
While parallels to the current situation are often drawn to the 1998 Fed easing after the long-term capital management hedge-fund blowup, the associated global financial crisis actually began in mid-1997. The Fed withstood market pressure to ease policy for more than a year, despite widespread belief on Wall Street that the Fed was not correct in its evaluation of the balance of economic and inflation risks.
It took a specific domestic financial crisis that threatened the U.S. banking system for the Fed to act, and that easing was, predictably, followed by a period of heightened economic and inflation growth that grew problematic for the Fed through 1999 and 2000. Though the easing of policy in 1998 may have been a necessary step at the time by then-Chairman Alan Greenspan, this policy-easing proved counterproductive for Fed efforts to steer the economy and inflation, as the Fed itself had suspected through the prior year.
It’s our guess that Fed Chairman Ben Bernanke shares this interpretation of that period and would prefer to avoid that outcome. As such, we think that Bernanke will be resistant to addressing market liquidity concerns with an outright policy-easing until he legitimately perceives significantly greater economic risk, or believes that inflation pressures are subsiding. Short of that, as with his predecessor Greenspan, it will take a specific insolvency event that requires the Fed’s immediate intervention to mitigate systemic risk to the banking system. And such an event, though a distinct risk in the weeks ahead, will be impossible for the markets to predict in advance.
Inflation: Above the Fed’s Comfort Zone
August 16th, 2007 | Posted by innovAmid the recent turmoil in the credit markets, economic data releases haven’t received the full attention of many market watchers. But Wall Street got some important updates on consumer-level inflation and the factory sector Aug. 15, along with a reading from the New York Fed on manufacturing conditions in the region.
The reports showed that core consumer inflation, which excludes food and energy prices, remains stubbornly above the Federal Reserve’s comfort zone. On the plus side, other releases showed solid factory sector readings for both July and August.
What About Interest Rates?
We still believe solid fundamentals suggest solid growth through the second half of the year, though credit concerns will override market interest in the economy over the near term. A still-tight labor market, rising wages for skilled workers, high rates of resource utilization, a weaker dollar, slowing productivity, and rising unit labor costs should keep upward pressure on prices.
Against that backdrop, the Fed will likely sit tight on interest rates at its next meeting in mid-September even as financial markets gyrate. Indeed, we don’t expect the Fed to respond to current market difficulties with a rate cut, as it would do little to resolve the market’s liquidity problems. Of course, if policymakers were to react, we suspect they’d have to make aggressive cuts.
Here is Action Economics’ rundown of the Aug. 15 releases:
Consumer Price Index
The CPI rose 0.1% in July, with the core index up 0.2%, versus June’s gains of 0.2% for both. Energy prices fell another 1.0% after slipping 0.5% in June. Gasoline prices were down 1.7% after a 1.1% decline in June. Housing costs rose 0.2%, with the owners equivalent rent measure at 0.2%. Food prices were up another 0.3%. Apparel prices rebounded 0.4% after declines over the prior four months. Vehicle prices were up 0.3%.
The headline CPI year-over-year gain moderated to 2.4% in July from 2.7% in June, though this measure will surge to the 3.7% area by November, as last year’s big commodity price freefall no longer figures into the calculation. The prior cyclical peak was the 4.7% reading after Hurricane Katrina. The core year-over-year pace was unchanged at 2.2% for the third consecutive month, which keeps this measure stubbornly above the Fed’s 2% soft target.
Empire State Index
This regional manufacturing gauge fell only slightly, to 25.06 in August, versus the 26.46 reading in June. The employment index edged up to 11.62 from 11.39. New orders dipped to 22.21 from 26.52. Prices paid were flat at 34.41, while prices received dipped to 3.23 from 8.64. As for the six-month outlook, the general business conditions index improved to 50.40 from a revised 48.24.
The mix leaves the average adjusted reading for the major sentiment reports in August leaning toward the 56 averages of May and June rather than the 55 level of July, and well above the 51-53 readings in the first four months of 2007. This year’s firm sentiment readings have reversed much of the 2006 downtrend from a 58 average early last year.
The inventory downdraft for GDP reversed direction in the second quarter, leaving a GDP bounce for the period that we now peg at 4.3%, vs. the 3.4% advance estimate, and a 2.8% clip for the third quarter. This stronger growth path for GDP over the two-quarter period is providing a solid floor for the factory sector, despite market turmoil.
Industrial Production
Industrial production rose 0.3% in July after a revised 0.6% increase in June. May’s 0.1% decline was revised down to -0.2%, but April was boosted to 0.6% from 0.4%. The July gain boosted capacity utilization to 81.9%, from 81.8% (revised from 81.7%) in June. Manufacturing production was up 0.6%, with motor vehicle production climbed 2.6%. Utility production fell 2.1%, while mining edged up 0.7%.
The report, with revisions, was modestly stronger than expected, as the July gain was largely in line with the flat factory and mining hours-worked figures for the month alongside a 1.8% bounce in vehicle assemblies. Meanwhile, the boost to the April and June figures left a modestly stronger second-quarter trajectory for the index overall.
We now expect a 3% third-quarter growth clip for industrial production, following an upwardly revised 3.3% (from 2.9%) pace in the second.
How to Rebound After Losing a Sale
August 10th, 2007 | Posted by innovHave you ever worked incredibly hard to win an order, only to have the customer choose someone else? Join the club. Of course, a “no” today doesn’t have to be a “no” forever. It’s how you respond to losing an order that determines your future sales success with that client.
A friend of mine who does business around the world told me recently that he’s always amazed when he sees salespeople lose their tempers or otherwise act unprofessionally after losing an order. They don’t consider that their childish response practically guarantees that they won’t be invited to bid on the client’s next big project. This turns a single no into a career no. Ouch! And salespeople who throw lost-sale tantrums also affect the salespeople who eventually replace them. Sore losers give their entire company a bad reputation.
There’s an old saying in sales: “When you lose a sale, don’t lose the lesson, too.” Develop a process you follow every time you lose a sale. Feel free to customize the following suggestions for your situation.
1. While you’re still selling…
During the sales process, ask your prospective clients how often they go out to bid. For example, let’s say you sell human resources services and your client is talking to you in September for a year’s contract with a Jan. 1 start date. If you don’t win the sale, make a note in your calendar to contact her next August. This will put you at the top of her mind and perhaps at the head of the pack of next year’s vendors.
2. Right after you get the Big No…
Try to be pleasant when the customer is telling you the unpleasant news. Unless they get perverse pleasure in telling you no, they are probably as uncomfortable telling you the bad news as you are hearing it. A few more ideas to follow:
•You might offer to be a backup vendor. Who knows? Their first choice might not be able to fulfill the order and you may get a rush order later on.
•Ask them where you fell short. If the reason they didn’t select you is something you are able to change or overcome, frame your response as an if-then proposition. For example: “If I understand you correctly, the reason you didn’t pick us as a vendor is because of Reason X. If I could solve Reason X, then would you award the sale to me?”
•Consider not responding immediately. It might look like your first offer was not firm. By waiting to respond, from a few minutes to a day or two, you can use your “if-then” statement. If they say yes, then add, “Good, because I got my X department to take another look at your situation and we made change Y so now we can meet your need. So do we get the business?” Know that using an if-then strategy may flush out other objections. You may want to ask another if-then question if you think the client is genuine—or cut your losses and move on.
3. Within the first week after a Big No…
Ask your boss or a peer you trust to call or meet with the customer to try to get her honest feedback on why you failed. You might want to alert your client to expect a management follow-up call and stress that you are not trying to change her mind. Have the caller say something like, “We never like to lose a sale but when we do, we try to learn where we stumbled so we can offer better service in the future.” Develop a standard list of a few broad questions, so they cover all the areas of the sale.
Compare your answers against your client’s. There may be something that ruined the deal that you weren’t even aware of. After comparing, gather your team to brainstorm for new ways to leverage your strengths and repair or compensate for your weaknesses. Performing these routine evaluations will make you and your team stronger.
4. Keep all your wins and losses in perspective.
Remember, a sales rejection is not a personal rejection unless you had a personality clash. If that is the case, you probably weren’t seriously in the running anyway.
A note to sales managers: It is important that you encourage honest talk after a sale, even though everyone already knows the result. And it is imperative that participants know that what gets shared in these discussions doesn’t get used against them.
I know a guy who lost the sale to be the keynote speaker for a big event five years in a row. Every time he got the Big No, he sent a nice card to the meeting planner just before the scheduled event, wishing her good luck. By the sixth year, she hired him to give the keynote speech. The quality and consistency of his follow-up process ultimately won the sale for him.
Remember, a lost sale today is not a customer lost forever. If you develop and execute a lost-sale follow-up plan, you’ll ultimately close more business. Happy selling!
August 9th, 2007 | Posted by innovOur technology team relies on complex, overly detailed PowerPoint for our company presentations. We’re often presenting to people with limited technical knowledge. What should we be doing to make sure we’re not overloading our audience with information they don’t understand?
First, congratulations for understanding that a crucial part of successful communication is what’s heard and understood vs. what you may have intended to communicate. Many presenters overload the audience with data the audience doesn’t understand or care about. Whether it’s because the presenter simply doesn’t know what to leave out or is trying to impress the audience with his knowledge, the results are the same: poor communication.
Much of the difficulty of PowerPoint presentations stems from a misreading of what they are designed for. PowerPoint works best as a visual reinforcement for what’s being presented orally, not as a substitute for the presenter. The effectiveness of oral presentations delivered with supplementary materials (such as PowerPoint) is different than information delivered through a written report—during an oral presentation, you’ll have to make yourself understood the first time your audience sees it and hears your accompanying explanation.
For technical presentations, this points to a need for streamlined and visually uncluttered charts, graphs, and other data-heavy slides. To help, try making two versions of your PowerPoint materials. One version (probably close to what your team is currently using) will be filled with detailed charts, graphs, and data—use this version as a handout for your audience to review and study later. The second version will be the one you present to them via PowerPoint—this version will use only the data needed to present context and overall conclusions, with streamlined graphic illustrations.
Your audience will thank you for making difficult information clear and understandable, both in your PowerPoint presentation and in written materials they can refer to later.
I simply never know what to do with my hands when I’m presenting. I either wind up tapping my fingers nervously or hiding my hands behind my back. I’ve even thought of taking acting lessons. Is there anything I can do to look more natural?
I’m a firm believer that business presentations don’t involve acting, or shouldn’t, since most of us aren’t very good actors. I tell clients to find the truth and the passion in what they’re talking about so they can begin from a comfort level with their materials. First and foremost, make sure that nothing you are saying in your presentation is responsible for creating the discomfort you’re noticing.
Secondly, think about how you use your hands in casual conversation with friends. You probably don’t even think about having to hold your hands still or hide them behind your back. You likely naturally use your hands as a sort of visual punctuation for what you’re saying. The idea is to bring those natural movements into public forums. Try “getting some air under your wings,” lifting your hands and arms more to punctuate your delivery. This may feel unnatural at first, but experiment with a few of the gestures you find yourself using in casual conversation. Remember, in a larger room, larger movements will work to make you look natural and animated.
Avoid repetitive motions—clasping and unclasping the hands, or touching your face—that signal nervousness. Remember, you’re not acting, but you are commanding a stage. Let your audience “see” as well as “hear” you communicate.
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