Excel is a great tool, it really is. As someone who spends half their life staring at spreadsheets, I wouldn’t be without it.
BUT, and there is a ‘but’, I believe that spreadsheets need to come with a business health warning that says: beware of spreadsheet creep!
If you’re using a spreadsheet as the critical tool for business analysis and management information, you need to ask yourself these questions:
- How long has it been in existence? You may be surprised by the answer to this question, I’ve come across spreadsheets that have been evolving for over 10 years.
- Does the spreadsheet still reflect how my company operates, or have I made my company ‘fit’ the spreadsheet model?
- How many people have modified the spreadsheet model since it was first set up and are they still with the company?
- How much time is being spent updating and number crunching?
- Is it transparent, or does it include historical formulas that no-one quite understands?
- How big and how complicated is it? Could you explain the entire spreadsheet to your accountant if you needed to?
- Would you stake your business on the accuracy of the data?
Because here’s the bottom line: if your spreadsheet-based management information system isn’t fit for purpose, it could be driving poor decision making that’s detrimental to business growth and profitability.
If your business is afflicted by spreadsheet creep, please stop, seek professional advice and ensure that you get the management information you need for a robust business.