Excel is one of the world’s greatest desktop tools and many people love it because it is familiar and easy to operate. If you want to analyze a lot of numbers or do some complex modelling on a static dataset, it’s hard to beat.I personally am a power user of excel and love the flexibility and ability to model various scenarios easily, and then analyse it. However, running a company involves collaborative, multi-department processes like planning, budgeting, forecasting, and reporting. It involves collating data from multiple source systems and people, curating & transforming it before it is ready for consumption. And that’s where the power of Excel falls short. Weeks are wasted every year, manually consolidating a mass of individual spreadsheets. Errors in cross-linkages, formulae getting converted to hard-coded numbers, manual errors, manual data entry, individuals having to laboriously search their computers to find the right data file, are all common problems excel users face all the time. Over the years, spreadsheets have been both a boon and a bane and have given many a nightmares to finance executives facing the wrath of an impending deadline. Here are some common excel problems that we often have to contend with:
- To refresh or not to refresh– we’re all too familiar with the uneasiness that comes with changing formulas and updating interrelated spreadsheets that share cell values. If we are lucky we will realise that we are looking at wrong numbers because excel did not recalculate and refresh the cells. If we are unlucky, we may be working with wrong numbers leading to wrong conclusions and decisions.
- What happened to my formula?– did you ever see a hard-coded value in a cell, and were absolutely convinced that you had put in a formula in the cell. Excel has a way of converting formula cells to hard-coded values in case of corruption or in case of linkages with other excel files.
- The dramatic crash: If you have seen the message “Excel cannot open the file because the file format….”, then you have been witness to hours of hard-work coming to naught taking precious data down the drain.
- To err is human, but your boss may not be divine. You can never be too careful, and errors do creep in, in spite of best efforts. In 2013, JPMorgan Chase lost more than $6 billion in its London Whale’ incident – allegedly due to copying and pasting incorrect information!
- The virtues of patience often get tested when working with a large number of spreadsheets and data, and the file takes ages to open
- Fragile for agile– Agile businesses require instant access to up-to-date information so that business leaders can make decisions quickly and accurately. The very nature of excel makes it difficult to achieve this objective.
- Not designed for teamwork– Spreadsheets are not designed for collaboration. Attaching spreadsheets in emails and passing it around takes too much time, leaving room for errors and a high chance of someone working with an older document.
- Too much formatting– Formatting the spreadsheet to make it presentable for reporting takes up too much of the productive hours.
When it comes to collaborative management financial reporting and multi-dimensional performance analysis, excel is not the ideal tool. Unfortunately, for most accountants, there is no easily available practical alternative.
The right software tool will not just meet the analytical capability that the executive management is looking for, but also the functional aspects of how an accountant prepares a financial report before it is ready for consumption (viz. regrouping of accounts, allocation of costs, segment reporting, consolidation etc.).
A single automated tool that will allow an organization to realize all the benefits and flexibility of Excel while mitigating its weaknesses and risks. A tool that is user-friendly and easy to learn.
So, automate your financial MIS today and escape from Excel Hell !