Where Spreadsheets Breakdown

Excel is an amazing tool. It is truly the great multi-purpose software of the past few decades. People can bend and twist spreadsheets to do pretty miraculous things – from planning a children’s party to full enterprise budgeting & forecasting.  In the early days of Excel and Lotus 123, spreadsheets were a major leap forward for the finance world to shed themselves of physical ledgers and an accounting calculator with a paper feed.  And even though most organizations will have long since moved into an ERP for their corporate finance system, many companies still today use Excel as their go-to solution for bookkeeping, payroll, AP and AR.

Like anything, of course, it has its limits. A spreadsheet serves as a great starting point for putting together a financial model for almost anything, but as that model gets more complicated, that spreadsheet loses its value and can become more of a burden than the effort required to maintain it. 

Too many spreadsheets

We regularly are given access to spreadsheets our clients had been using prior to adopting our system, and it is always a jaw-dropping experience seeing the complexity that goes into them. Not surprisingly, there are typically many errors, missing references, parts that are out-of-date, and a blinding number of tabs that require a forensic exercise to unravel what on earth is going on. It amazes me to think of the monumental number of hours well-paid employees have spent doing backflips getting it to that point.

These documents start off harmlessly enough – clearly, it’s never anyone’s intention that they’re ever going to get that complex.  But as companies grow and their projects get bigger and they start taking on more and more projects, this spreadsheet(s) grows to meet the demands of this increased volume and complexity.  Suddenly, there is a collection of intensely intricate spreadsheets that have grown organically over time and now serve as the “System” for managing, controlling, and reporting on their projects.  Compound that with the fact that there’s rarely one person that is the owner of any one spreadsheet, so they tend to suffer the mistakes of many fingers in the pie, resulting in uncertainty and general lack of confidence in the integrity of the information.

I’m sure I could come up with a top 100 reasons to ditch your spreadsheets, but I have a feeling you might already have your own list, so chances are, I’m preaching to the choir.  What I want to get across, is that there’s a tipping point at which using a spreadsheet simply breaks down.  Volume and complexity simply overwhelm what is reasonably achievable in a spreadsheet.

Construction Project Management Software

Up to that point, they can be tremendously useful – what’s important, is to recognize when you’ve hit and gone past that point and to take bold action to onboard a solution designed for your business, fit for purpose for your operational needs. And, yes, ditch the spreadsheet chaos and shift your time, money and effort into high-value activities rather than burning out in Excel.

Share this post