Unleashing Enterprise Financial Management Potential: Why Step Away from Excel in 2024
Excel is everywhere. With more than 750 million users, it's a staple of financial management software, found in offices around the world.
When Microsoft first launched Excel in 1985 its accessibility, ease of use, and flexibility made Excel the first choice for crunching numbers.
In an ad at the time, they made this claim:
“Microsoft Excel. The soul of the new machines. And the heart of a business solution that will make as much sense five years from now as it does today.”
But - almost 40 years later - does this still hold true?
Does Excel make sense as a business solution for financial management in 2024?
A recent report based on a survey of 200 CFOs at businesses of up to 500 employees showed that 81% of CFOs suffer from the most intensive daily manual work, compared to any other role in the C-suite.
This seems counterintuitive to the strategic role that a CFO should be: building roadmaps for future growth based on data insights, rather than simply reporting on the past, not being tied up with manual processes to the detriment of big picture thinking.
CFOs, we argue, need new tools: to allow them access to accurate data insights - on demand - and be freed up to work on more meaningful tasks to drive the business forward.
If the financial side of the C-suite is suffering from inefficiencies and outdated systems, is it time to take a look at how stepping away from Excel in 2024 could be the operational game-changer for your business?
Let's explore the limitations of Excel for enterprise financial management and the frustrations our team sees time and again from CFOs and their FD&A teams.
The red flags that suggest your financial management needs to escape Excel
Excel might be workable in small teams, but as companies scale the complexity increases and managing a never-ending stream of data via Excel becomes untenable: and when Excel ceases to be functional, or worse, breaks, it’s typically a consequence of scale.
Version control, layers of permissions, multiplying integrations and simple human error combine to break the ‘Master Sheet’.
According to an FSN survey, more than 50% of spreadsheet users said they spend too much time checking numbers manually every time a change is made. And a staggering 97% lose sleep over missing deadlines, making errors and not having adequate controls.
Even if a catastrophic data error is avoided, the manual nature of Excel frustrates the timely creation of data sets that can meaningfully inform business strategy.
One report cited that, on average, 17 people are involved in a company’s budget, with that number rising to 23 people in companies of 500 or more employees.
“Sharing financial documents and spreadsheets across so many stakeholders adds complexity and creates delays,” the report noted. “Consequently, for 78% of companies, the budget process takes between 1-3 months to complete, while 92% of CFOs are frustrated.”
“Information is the oil of the 21st century, and analytics is the combustion engine.”
~ Peter Sondergaard, Senior Vice President and Global Head of Research at Gartner, Inc.
Without an engine that can organise the financial information in its most powerful form, businesses cannot capitalise on their most powerful resource: data.
Let’s run through the top five challenges Excel presents to enterprise financial management teams and offer some solutions.
Excel’s Top Five Challenges for Enterprise Financial Management
- Limited Collaboration and Version Control
Excel's traditional desktop-based approach hinders seamless collaboration, leading to version control nightmares. Collaboration is essential for modern enterprises, and cloud-based alternatives provide real-time collaboration and version tracking capabilities.
- Security Concerns
As enterprises handle sensitive data, the security of information is paramount. Excel's vulnerability to data breaches and its limited security features pose a risk to businesses. According to a study by Cisco, Excel is one of the top Microsoft Office formats that receive malicious file extensions.
- Scalability Challenges
As mentioned above, Excel was designed for individual users or small teams, and as enterprises grow, they often outgrow Excel's capacity. Managing large datasets becomes cumbersome, leading to performance issues and inefficiencies
- Integration Complexities
In today's interconnected tech ecosystem, seamless integration with other business tools is vital. Excel's limitations in integrating with modern enterprise systems can hinder workflow automation and data consistency.
- Inefficiencies in Reporting and Analytics
Generating comprehensive reports and conducting in-depth analytics in Excel can be time-consuming and error-prone. According to Ventana Research, 35% of users said data errors are common in the most crucial spreadsheets they use at work.
Life For Effective Performance and Financial Management after Excel?
Despite its limitations at scale, Excel is a great tool for enterprise finance… but only when it’s used with other financial management solutions that consolidate data to achieve an open, live and collaborative system that allows end-users and management to work together from a single-source of truth.
Retaining aspects of Excel, leans into an end-user’s existing knowledge about it - hopefully meaning more successful adoption.
Solutions exist which mean Excel can stay as a main interface to planning and forecasting solutions, but instead of spending countless hours administering and reconciling versions upon versions of spreadsheets and formulas, users spend their time on strategic analysis and value-creation for their companies.
For those companies still relying on manual planning and budgeting methods, the time has come for an upgrade in financial management processes - and you’re in the right place to make that leap.
Insight Models helps CFOs and their teams reset and change gear - setting your FP&A talent free to work smarter, not harder, on your business goals with financial management audits, software and consultancy to create efficiency and deliver insight to your financial management and analysis.
And, we have solutions that give your teams the capacity to work in the native Excel interface, encouraging a high user acceptance across business functions and a short learning curve.
The financial management services we offer:
- Financial Planning and Reporting Audit - where are you now and where do you want to go?
- Financial Planning Software - We cut through the noise and help you select the right software, package and licence to suit your needs and your budget.
- Financial Models Implementation - We get the financial reporting and planning tools set-up and in the hands of your financial team with as little fuss as possible.
- Training and Performance Consultancy - We get to work bringing new datasets and systems into play within your new reporting and planning software to optimise the performance of your business.
For freedom from spreadsheets, greater performance insights and reduced admin burden on reporting - book a call with our performance management consultants: