With over a half billion users worldwide, Excel is one of the most popular tools in business for collecting and managing data. It is also the biggest culprit when it comes to the creation of data silos, errors, and process inefficiencies. Five Talent CEO Preston Callicott and CTO Ryan Comingdeer take on Microsoft’s darling in an attempt to convince businesses Excel’s time has come.
CTO: I can hear the protests of millions of users right now, but Excel has to die. Users love Excel because it’s familiar and easy, but it’s deadly when it comes to creating data silos within your company. It starts with one innocent spreadsheet, but before you know it, it has spawned a hundred more. Keeping data in sync and maintaining accuracy becomes impossible. In addition, it’s a security risk because those spreadsheets get buried in folders or sit on laptops that exit the building.
CEO: I agree. Excel is fine for basic formulas, or quick ad hoc analysis for a unique need. I believe employees generally have good intentions when they start using Excel to stay organized. Still, it’s our job as managers to keep a close eye on why they are getting used and for what purpose. Security is also a key concern.
For example, some top-level executives will tell you they are using three spreadsheets to run their business. However, if you take a few hours to walk around the office and ask people what they are working on, you will discover that there are potentially hundreds of spreadsheets running your business. So instead of capturing 100 fields of data, your company may be collecting a thousand fields of data – and they all exist outside any kind of system capable of managing it.
Frankly, I think a lot of people use Excel because they had a bad experience in the past with a purchased solution that cost them a lot of frustration and money to retrofit. As a result, they just learned to work around it. I know it gets into the whole “build vs. buy” debate, but that’s why custom databases are such a better investment. When you build a custom system, you can ensure it fits your business perfectly. Off-the-shelf systems may seem more cost-effective at first, but you end up trying to fit your business to that system, instead of the other way around. That’s when users turn to Excel as a workaround.
CTO: The most common thing I see is that managers export data out of the system to do their own analysis and create a report they want but don’t have. It seems simple enough, and not something to bother IT about. Once that report gets created, it gets emailed to other managers who make their own changes, which means there are multiple versions floating around the company. The real question is whether that report is valuable enough to be created within the system. Chances are if it is getting used again and again, there is probably a business case for including it in the system.
You also can’t easily create and manage three-dimensional data with a two-dimensional solution like Excel. Excel forces you into a bad data environment because of the lack of relationships it can specify. The powerful thing about a database is the number of decimals you can get down to. You can get so much more precise on calculations with SQL or other relational databases. Excel hamstrings you immediately. Even Access is better than Excel because it can be changed on the fly.
CEO: Absolutely, Excel might be fine for data management when you have ten customers or even a hundred. It’s when you start getting massive amounts of calls and data coming at you that everything falls apart.
CTO: If you can define a data collection system that everyone agrees upon from the start that is dynamic, you are going to save a lot of time, money, and energy later on. You have to look at that first system as a prototype. Initially, it’s going to be inefficient, it’s going to have errors, and it is going to constantly evolve as you learn your own process. It’s still better than having hundreds of spreadsheets all over the place.
CEO: Startups and fast-growing companies typically determine the processes that work for them through trial and error during their first quarters of operation. And at the same time, they’re trying to keep up with increasing sales, production, and customer service calls.
Implementing a packaged solution in the first year or two is fraught with problems, especially when you’re trying to fit the company into the solution. This ends up being a nightmare down the road. It’s better to build a working prototype that evolves as the business does. That way, if you need to add a few fields to track alternate pricing models, you can just add them and get it into production immediately.
CTO: Even a rapid prototype database capable of evolving gives you a better foundation than trying to retrofit everything later on. Sure, you’re building the proverbial rocket after it has taken off. But at some point, when you know 80-90% of what needs to be done, you can take the prototype and build an application against it that works even better. You might even find that rare package that can adapt to the unique attributes of the company.
CEO: So we’re going to get rid of all of our Excel documents here at Five Talent, right?
CTO: Why are you asking me? We stopped using Excel in 2002! Didn’t you?