Are spreadsheet solutions like Excel becoming obsolete? With data sets getting bigger and bigger, growing companies need intuitive and real-time tools to make the most of their data.
Traditional spreadsheets have been the bread and butter for businesses for decades. Their universal usage has made them the tool of choice for planners, accountants, and entrepreneurs around the world. For growing businesses taking advantage of our current age of ‘Big Data’, however, more sophisticated tools are essential moving forward.
Business Intelligence (BI) software is one such tool that gives leaders the power to make informed, timely decisions based on their data. Through the processes of analyzation, visualization and prediction, executives can identify competitive advantages, streamline action plans, find new opportunities, and boost revenues. Spreadsheets, on the other hand, are in many ways antiquated and open up businesses to unnecessary risks. We’ll explore these and more in this post.
Susceptible to Fraud
Despite all of their uses, spreadsheets such as Excel are inherently susceptible to fraud. This is due to lack of controls where formulas and values can be manipulated with zero evidence of activity. Alteration of data, hidden columns or rows, private codes—all tactics of spreadsheet fraud that have resulted in billions of dollars in losses. Additionally, discovering these crimes requires deep investigation and a close eye on mountains of data.
Open to trivial human errors
Small mistakes in spreadsheet data inputs can lead to catastrophic losses and errors in judgment. A missing plus or minus, for instance, can cause confusion and serious headaches to identify and fix, eating up valuable time. Today’s hyper paced business climate means there’s simply no time to waste on manually managing spreadsheet inputs, verification, and problem solving. BI, on the other hand, can automate all of these processes once set up. This leaves you and your team with time for bigger and better things, like growing your business.
Not suitable for agile business practices and data discovery
We’re living in an age of constant change when it comes to technology and how business is done. If your company isn’t ready to pivot, transition, and take advantage of new opportunities, you’ll be left in the dust. Traditional spreadsheets are hyper-personalized and only understood (or oftentimes not) by the people who create them. When that person leaves the organization or work is passed on, all that labor usually goes to waste and needs to be re-created from scratch.
As far as data discovery, spreadsheets are an inadequate and outdated tool — data cannot be gathered from multiple sources or followed from creation to final actionable insights. BI offers decision-makers a one stop shop for syncing, filtering, analyzing, and visualizing. Data becomes understandable through dashboards and views. In short, quality data becomes monetizable without needless busy work.
Limited data handling capabilities
Excel, for example, is limited to one million rows of data tables. A manufacturing production line can produce that much data in a single day! By comparison, BI can essentially handle an infinite amount of data. A BI software should be thought of like an octopus: it has plenty of arms through which an almost endless source of data can be collected, be it:
- ERP system,
- CRM system,
- Warehouse management, production management systems,
- Excel spreadsheets,
- Google or Facebook advertising account
- various installed sensors (for machines and buildings),
- most known databases,
BI software automatically collects data at specified intervals, organized in a structure that is easy to:
- generate queries,
- examine correlations,
- and visually display all of this.
BI also offers the ability to schedule backups and with continuous synchronization, data can be restored at any time.
Authorization management and collaboration
At the field and table level, you can specify which user sees what, while in Excel, this is not possible without authentication. In BI, we can easily hide payroll data from a department that works from the exact same source. This also saves resources because we only have one set in the background, and while fresh data comes to everyone in sync, certain departments are not allowed to see everything in the system.
Forecasting, budgeting, and planning are all collaborative tasks. If your team is spread around the country or the globe, the only way to share spreadsheets is through email or similar methods. Again, this opens your data up to fraud, errors, and duplication. Keeping track of such exchanges is a job in and of itself.
Tracking relationships
Even the slightest modification in Excel can upset dozens or even all of the calculations we do, and it doesn’t even warn you that related ‘tables’ or calculated fields are built on that data. In addition, Office 365, introduced in 2017, has serious problems with this, in which these data connections are lost and which have not been fixed to date.
BI has built-in / usage monitoring in place, so we cannot (without warning) make the mistake of ruining or not noticing such a move that even affects the authenticity of our statement.
Data cleaning problems
Excel can handle anything because there is no input control for data entry (which can be done in ERP). If Excel is your controlling tool, you won’t be able to resist the temptation to use it for data entry as well. We often hear “I accidentally wrote text here instead of a number”, and that’s when the tedious process of data cleansing comes, and you need to check to see if all the data or formula is really correct in Excel. It is not uncommon for most working hours to be spent correcting errors in an organization than actually analyzing.
Summary
We’re not against Excel, just what you need to see is that both Excel and BI are tools, optimal for their respective uses. There is no simpler, faster, more universal or cheaper tool for ad hoc analysis and records than Excel. But if you’re already on your knees with 1 million data sets, you’re likely experiencing its limitations in terms of data volume, complexity and data security. The next level in making the most of your data is then, without a doubt, BI.
To learn more about BI, how it helps businesses and its role together with spreadsheets, get in touch with us today.