Excel Hell: why to stop using spreadsheets for everything
Excel’s original purpose was financial modelling, a magic sheet of paper that can run calculations. But that era is long gone. Now spreadsheets are a staple in every business, used to replace any business process for which people lack dedicated software.
It doesn’t matter whether you need to create a database, manage a project, or run an annual pay review, people will force any process they can into a spreadsheet. That’s problematic.
In this blog we are going to discuss why this is and how it damages your business.
Excel - Pandora’s box
Stemming from Greek mythology, Pandora’s box means: “A gift which seems valuable, but which in reality is a curse”. This turns out to be quite an accurate description of Excel and spreadsheets in general.
They are a gift because they can afford you a lot of freedom. A spreadsheet greets you with a blank grid where you can quickly organise some data and receive results, if you know how. There’s no denying the strength of Excel’s versatility in this way.
So what’s the curse? Well, it doesn’t take long for this freedom to lead to grandiose ideas. Ideas of using Excel as a be-all-and-end-all tool for managing every business processes.
See how PayReview can help you escape from spreadsheet hell
This is a problem because spreadsheets are severely lacking for most tasks outside of financial modelling. Take the annual pay review, for example:
In our 2020 software survey, almost 80% of companies use Excel to manage this critical process. Yet only 1 out of the 10 features we asked about received higher than a 50% satisfaction rating.
Spreadsheets are just not built for these tasks. And despite Microsoft retrofitting Excel with more and more features, it is always playing catch-up, and it can become confusing to know which feature best suits what you are wanting to achieve. It is a case of forcing a square peg into a round hole.
Flexibility, but at what cost?
It is no doubt impressive that Excel can (kind of) perform such a wide variety of roles with a business. But this flexibility also makes it very easy to make mistakes. And this can be costly.
In 2020, Public Health England lost 16,000 rows of patient data by saving a file in the wrong format.
Construction company Emerson under-estimated a bid by $3.7 million by forgetting to include one cell in a calculation formula.
Faulty formulas and cut-and-paste errors cost JP Morgan $6.5 billion in losses and fines.
What’s pertinent about the last bullet point is that, in this case, Excel was actually being used for financial modelling. So there is potential for catastrophic problems even when you use the software for its intended purpose.
It’s just so easy to accidentally delete data, copy-and-paste incorrectly, or mistype a formula. And unlike dedicated software, there are few safeguards in place to stop users doing whatever they please. Often, it’s to their own detriment, we’ve all been there, it’s what we call Excel hell.
A great video from ‘Stand-up Maths’ about spreadsheets errors!
How much are you actually saving?
There’s no getting around the fact that dedicated software costs money. And as most businesses have Excel by default, it’s easy to think that using a tool you have already paid for will save you money.
The problem is that advanced applications of data rarely fit well into Excel’s grid design. Sometimes you may want data to change based on dynamic conditions, show and hide as necessary, or draw from multiple other sources.
This is when the true scope of your task emerges. You will need to build all these tables, relationships and formulas from scratch. That’s not to mention the maintenance. If there are changes required, you may need to rebuild entire aspects of your spreadsheet which can take time that you hadn’t accounted for and manual intervention that could disrupt other areas and cause chaos.
That’s not to say that Excel is not capable of these challenges. But you are going to end up spending hours building functionality that dedicated software comes with off the shelf. At the end of it all, you will find your process much less efficient and more error prone as well as incredibly time consuming. You are essentially taking on the role of a software developer.
All this demands a specific way of thinking and Excel skills that many people lack. And the effort it takes detracts from the very job you’re building the tool for.
How’s the view?
The next matter is how you present your data. You will want to make sure that you lay it out clearly, especially if it informs important decisions.
There’s two things to consider here. First, laying out data effectively isn’t easy. User experience (UX) design is its own dedicated industry with a lot of expertise. Second, Excel links data to its formatting. This means that any change that requires separating the two creates an unending nightmare of layout changes.
A well-made system has innumerable hours of user interface design behind it. UX designers ensure that it is effective for many types of users and their needs. They run tests on their products with users and iterate on them continuously. Comparing good UX design to even a well-designed spreadsheet is like comparing the present day to the Victorian era.
A typical spreadsheet.
What happens when the creator leaves?
There’s one last thing to consider. Imagine that, even after considering all these shortfalls, you press ahead and force Excel into whatever you need it to be. You get someone on the job and they create something that isn’t perfect but works.
What happens if that person leaves?
All the knowledge leaves with them. If they were the only person who knows the inside workings of the spreadsheets, then suddenly they leave you with a defunct system. No-one can update, change, or re-factor it without increasing the risk of even more errors and wasted time.
“Because [Excel is] so easy to use, the creation of even important spreadsheets is not restricted to people who understand programming and do it in a methodical, well-documented way,”
James Kwak, professor of law at the University of Connecticut.
The money that you perceive to be saving when you choose Excel over dedicated software all goes into the time to build a spreadsheet-based system that replaces it. Once that person leaves, you will need to re-invest time to rebuild everything. It could be possible to figure out how it works, but remember that the creator was not a professional software designer. So it may not be easy to untangle.
What is the solution?
The answer is simple: dedicated software. Solutions made by experts for the sole purpose of the task you want to complete with technologies that far exceed the capability of Excel, all created with the end user in mind Those same experts will ensure the system is always working, improving and serving you best.
Yes, you can save some money in the short term by just using Excel. But you will end up paying the difference on the journey to figuring out that you should’ve just bought the dedicated software to begin with.