Why Spreadsheets Are A Weakness to Your Work-Flow
By Jenny Heyside - Feb 24, 2017
In today’s business world there is a growing need for operational efficiency, scalability and resource optimization. If we look at the key financial processes such as budgeting, planning, forecasting and reporting, an overwhelming number of businesses continue to depend on spreadsheets to perform these important functions.
However, this is the wrong type of process. Here are 7 reasons why spreadsheets are a serious weakness to your work-flow.
1. They are costly and resource heavy.
For the most part, spreadsheets require a lot of manual effort in order to distribute, compare, and consolidate their information. They lack automated processes that are found in budgeting planning software such as auto signature, approval, and production of reports. In addition, they are often-times not able to be integrated with other business systems (e.g., HR, CRM, AND ERP), which leads to a waste of time and resources when the same information needs to be updated in multiple systems.
2. They make the budgeting process difficult.
When using spreadsheets, the focus will be on administrating the data, rather than on how your firm is optimizing its budgeting process. Not utilizing a budgeting planning software makes it difficult to make a special template for different departments and gather data from multiple functions. Throughout this process, comments and budget notes also get overlooked.
3. They promote ineffective collaboration.
Just think for a minute — when your data is up to hundreds and hundreds of spreadsheets (which is not uncommon for even small-sized firms), it is immensely difficult for the various departments to work together to allocate resources. Silo mentality and approach weakens collaboration during budget development, and makes it problematic to reconcile the budget with the overall company strategy when the track is difficult to access.
4. They are the opposite of a multi-user solution.
One of the biggest benefits of having some kind of budgeting planning software is the fact that it allows multiple sections of your firm to be a part of the budgeting process. On the other hand, spreadsheets are not a multi-user solution. They provide major challenges around accesses, control, and security.
5. They lack a database structure and a comment function.
For the most effective budgeting planning software, you must have a process that includes multi-dimensional data. Spreadsheets lack multi-dimensional data, which means that they don’t have a database structure, merely a flat template. With this kind of data it is not possible to add notes or comments (e.g. line item level) that automatically add into the financial and management reports.
6. They have little to no security and you have little to no control.
Let’s be honest, how often do you have problems with your version control and local file storage? We all have had those moments when some technical glitch has occurred and then there is suddenly no history of the changes that users have made, meaning hours of work are wasted. Spreadsheets also have far greater risk of human error (e.g. destroying links or rode in a formula) than any kind of business budgeting software.
7. They have imprecise overview.
While using spreadsheets, there is no comprehensive overview of the budget and multiple versions of the truth about the financial performance. In other words, they lack perspective. This means that management and stakeholders have far less trust in the reports and your firm’s budgeting process.
No longer operate under separate planning & reporting processes and finally upgrade your budgeting planning software. With Kepion’s Corporate Performance Management (CPM) Solution, you can collaborate on a single approach for integrated business planning. Designed for the business, by the business, Kepion’s Corporate Performance Management Software allows sales, finance, operations, marketing and HR to configure personalized planning apps specifically to how they work. Kepion’s Dashboards and Scorecards Software helps you visualize performance, plan for efficiencies and track your results.