Excel spreadsheets aren’t databases, nor are they analytics tools—and the fact that small and mid sized business owners treat them as such may be holding them back. Almost 90% percent of spreadsheets contain errors that change analytics and forecasting results, for example. Version control issues make it a long and difficult process to update spreadsheets correctly—imagine changing the same figure across 80 spreadsheets, for example. (Perhaps you don’t have to imagine.) Lastly, spreadsheets aren’t inherently secure, which means your critical data can end up in the wrong hands.
Given all these drawbacks, why do 62% of executives still rely on spreadsheets? It turns out breaking hold of traditional tools can still be a drawn-out process. Excel is the tool which most people are familiar, and the perception is that powerful analytics tools are expensive and difficult to implement. What small and mid sized businesses need is a tool that can replace Excel and provide the robust data juggling capabilities that they need with a familiar and user-friendly interface that isn’t a vast departure from what they already know.
Why Is Excel Inefficient at Planning?
The biggest issue with using Excel is that it often the repository for the business’s entire data store. Sales, budget and payroll end up in one spreadsheet or another. Another limitation of Excel is that it does not have robust visualization tools for highlighting or displaying relevant data—everything is raw data as far as Excel is concerned. This means that business leaders are missing out on actionable conclusions amidst all the rows and columns.
The limited data visualization tools that are available in Excel include simple pie charts, bar charts, and graphs. Simple isn’t always better. Pie charts, for example, are potentially ripe for misinterpretation. They can be uncomfortably text-heavy, it’s difficult to accurately determine relationships between pie slices, and more colorful slices are likely to be disproportionately weighted in decision making. Essentially, built-in Excel visualization tools give people the opportunity to make poor information design choices.
Excel is also susceptible to data loss. If you’re using traditional Excel, and not the cloud-based Office 365, losing Excel data is as simple as deleting the wrong file. Alternatively, these files are susceptible to cyber attacks and employee theft. Lastly, you can lose vast chunks of data or render them meaningless by reordering your management schema or converting files from .xlsx to .csv. In other words, the longer you store your data in Excel, the greater chance that you could lose it.
Lastly, the importance of real-time data cannot be overemphasized. Excel isn’t real-time—there is no way to natively use Excel to generate real-time foresight into business drivers. To get a conclusion from an Excel spreadsheet, you must manually manipulate the data in it. By the time you finish, you may have missed a window of opportunity—either to take advantage of a favorable business outcome or to mitigate an unforeseen failure.
What Factors Would Comprise an Efficient Planning Tool?
How do you take information out of your Excel spreadsheets and use them to generate accurate forecasts for your business in real-time? What’s more, how do you do this without breaking the bank, hiring new FTEs, or extensively training your workforce to use a solution with which they are not already familiar?
IBM Planning Analytics is exactly what your business needs. It’s a planning tool that is explicitly designed to replace Excel with rich forecasting, planning, and data visualization capabilities. What’s more, it helps companies ease themselves off Excel by integrating with the spreadsheet program and using an interface that’s specifically designed to be approachable for Excel users. In other words, if your employees are already Excel experts, they’ll soon become Planning Analytics experts.
Some specific benefits include:
Decision Support: Don’t blindly make decisions that can affect your business. Instead, model the impact of your choices and understand those impacts. Use a sandbox environment to tweak the variables until you arrive at the best possible solution for your business.
Efficient Management: Create a single source of truth, eliminating data loss and version control issues. Updates made in a central location will be reflected in all other data sources, eliminating manual efforts and version control issues. Meanwhile, cloud data storage prevents data loss.
- Low-Effort Automation: Create a pipeline from your mission-critical applications to your data warehouse and to IBM Planning Analytics with a simple drag-and-drop process that’s easy to understand and master.
You’re probably sitting on a relative goldmine of data that would allow you to optimize your business and increase revenues—but it’s hard to tell the gold from the dross. Here at LPA, we specialize in working with businesses to receive actionable insights using IBM Analytics platforms. With 20 years of experience, LPA is one of the most trusted analytics partners in the market.