The Case For Excel
By: Trevor Lee
Tags: Accounting, Financial Reporting, Excel, Financial Planning, AI

Microsoft Excel was invented in 1985 and has captured the accounting and finance industry ever since. What you may not realize is that Excel usage is still growing at a remarkable rate. Last year alone, Excel usage grew by 30%(1) making it one of the most used products in the world.

Despite its usage, there are some drawbacks to using Excel for planning and reporting:

Data updates are manual — Data is maintained by copying and pasting from external sources — which is rife for user error. Users are forced to remember each time data changes from the original source and update each spreadsheet accordingly.

Data is stored locally — Spreadsheets and the data within them are saved locally. Leading to different teams bouncing different versions of the same document around as it gets updated.

Not designed for a full solution — Spreadsheets weren’t designed to scale and be the sole source of planning and analysis. Larger solutions are needed to supplement the spreadsheets once the organization scales beyond a certain point.

While there have been frequent discussions and attempts to replace Excel, its staying power is well documented.

The fact remains that users like Excel and continue to use it despite these shortcomings. It is so popular for a few reasons:

Excel is easy to use — This is the main reason it is so popular. The ability to easily manipulate numbers is understood and appreciated by anyone working in finance or accounting.

Everyone already knows Excel — A less obvious benefit is that there is already massive adoption of people in organizations who know how to use it outside of the traditional users. The challenge with introducing new software is that the learning curve for peripheral team members is high. With a new solution you have to train the direct users (who may be willing to put in the time to learn) plus anyone at the organization that might also use the data (who may be less willing to learn). Otherwise, you end up in the same place, exporting xls files from your software for other teams to use.

Excel is already everywhere — If you are reading this, you or someone at your organization is probably using Excel right now to maintain at least one spreadsheet or data set. Your process for maintaining the data might be manual and time consuming, but you don’t consider your process broken. Since you don’t think the process is broken you don’t want to invest the time or resources to put in place a new solution.

Plays well with others — For most users, Excel is a complement to their existing financial planning and reporting process (FP&A). Users download data from their main system of record, manipulate it, and create some sort of analysis — even if they have other software to do this very thing, only to re-upload it back into the original system. This is the missing piece to the puzzle and why Excel as a complementary tool isn’t going anywhere.

With all these positives — we can all agree there are still opportunities to improve processes and workflows to help eliminate manual errors in a more scalable solution. The transition to the cloud is coming and software can help ease that transition.

We think that’s where software like ours can come in and help connect the dots.

By utilizing Excel as the front end, an opportunity exists to help build the pipeline of data into Excel in more customized and flexible ways. This gives teams the flexibility to seamlessly get data in, out and between any other software they may be using.

We differentiate our solution by using:

Off the Shelf Software — The sales process for new FP&A software is painful and requires users to rip and replace any existing solution. That’s why it is easy to get momentum with startups who don’t have an existing process, but for companies or accountants with existing processes in place it is harder to get them to make the switch. By creating a productized tool, users can onboard and get value immediately while increasing their usage over time as they become more comfortable with the solution.

Formulas — The bread and butter of any Excel workbook relies on the ability to utilize formulas for calculations. We connect to accounting and other 3rd party related software while creating customized and simple Excel formulas for the user to pull individual data items into models or reports they have already built. This gives unlimited flexibility to design and create spreadsheets that are no longer static and can update with real-time auditable data.

Data — Leaving the front end to Excel allows us to focus on being the data pipeline across software and spreadsheets. Using ML we can create solutions that will go past delivering the UI of forecasting and financial reporting. We envision a future where companies can expect actionable insights to help their business that go beyond traditional spend management.

Ultimately by focusing on backend data flows, we will be able to connect software and data throughout the finance and accounting suite, seamlessly integrating across all reporting and forecasting environments. We see this as an advantage due to the intense competition for companies competing to be the solution of choice and the continued likelihood that the market for planning and analysis stays fragmented between a mix of 3rd party software, ERP systems and of course, Excel.

www.geniussheets.com

1)https://www.wsj.com/articles/finance-chiefs-are-still-trying-to-replace-excel-with-new-tools11626859801?utm_content=buffer15d35&utm_ medium=social&utm_source= linkedin.com&utm_campaign=buffer;