According to Finance Week (http://www.financeweek.co.uk/cgi-bin/item.cgi?id=6073), in a survey only 16% of firms are performing budgeting accurately and highlights significant issues in the financial planning process. Apparently 76% of respondents stated that they used Excel heavily in the budgeting, forecasting and planning process. That is not to say that Excel is the problem - it is more of a statement about how is used (or more appropriately misused).
Microsoft Excel is probably the most popular desktop application in the world. It has revolutionised how we manage numeric data over the past twenty years. Excel does, however, have its limitations. Excessive dependence on Excel spreadsheets for reporting and analysis can lead to ‘Excel-Hell’. You can see this exhibited via a number of symptoms:
- A ‘one question many answers’ syndrome - because everyone has their own version of the truth;
- A high degree of effort required every time the smallest thing changes; and
- Excel is a private data store rather than a corporate one - inhibiting collaboration and breaking down lines of communication.
Excel was never meant to be a corporate database, but has become just that. One key problem is that data is stored repeatedly all around the organisation in different formats. Excel is also hardly the most secure of environments for highly confidential data!
How do you provide the power of Excel, without the Hell?
By centralising and workflow controlling data to manage your Excel data you can deliver the best of both worlds helping to ensure ‘one version of the truth’. By empowering your team, keeping Excel as the powerful calculation, modelling and user-interactivity tool, but moving the data storage element to a formally designed and managed database, your planning and analysis teams:
- Get to use an environment they love – Excel;
- Can manipulate, analyse and interrogate information with ease;
- You reduce time collating data; and critically
- Enable increased time analysing data.
At the same time you:
- Gain instant access to the current ‘bigger picture’;
- Maintain audit trail and data consistency for compliance; and
- Empower your organisation to make decisions.
Solutions to these problems take many forms, from 'off the shelf' products from Microsoft themselves, to organisations like SAP, Oracle & Business Objects through to bespoke, custom-developed solutions or an appropriate mix of the two to deliver the exact needs of your business.
Budgeting, planning and forecasting accurately is critical to business success, doing it accurately can be a lot easier than many would have you believe!