Have you ever had that awkward conversation with a significant other where they tell you they just want to be friends?
Sometimes the news is hard to swallow. It forces you to ask yourself, “What could I have done better?”
This same tough conversation needs to happen with certain software applications too. People just stay in relationships with software for too long. That said, it’s time to have the “friend talk” and break up with spreadsheets.
You’ve never really loved them. It’s been a relationship of convenience – they just showed up one day on your laptop and the rest was history. Yes, they’re nice and have a good personality (as much as software can), but it’s time to cut the cord and just be friends.
Disclaimer: I am not attempting to disparage or declare war on spreadsheets. They serve a useful purpose and will always be a staple inside organizations, but they are not the analytic application you want to bring home and introduce to your parents.
Spreadsheets have been widely used for financial and cost accounting, data collection and analysis, and mathematics. But, when they are called upon to perform a task for which they are not designed or beyond the limit of their capabilities, spreadsheets can actually be a fatal attraction.
Mark Smith, CEO and Chief Research Officer at Ventana Research says that spreadsheets “can be one of the most expensive pieces of technology because of the risk and wrong decisions that are made due to their numerous errors.”
In fact, a number of studies have indicated that 90 percent or more of spreadsheets contained errors.
And Bruce McCullough, the software editor for the International Journal of Forecasting wrote that “Professional statisticians continue to write books with titles like ‘Statistics with Excel,’ but they now warn students not to bet their jobs on Excel’s accuracy. They advise students to use a real statistical package when they need to do statistics.”
So, I guess you have to ask yourself, do you want a meaningful relationship with your data, such as being able to perform detailed analysis, find hidden patterns or make reliable forecasts, instead of a dangerous liaison that gives you little in return, besides frustration?
Speaking of meaningful relationships:
· Elie Tahari, a global fashion brand, found that its retail controllers were struggling with monthly budget reports because its 22 locations submitted spreadsheets separately. By turning this task over to a more robust business analytics solution, they were able to create a seamless reporting framework that provides granular, real-time information from the sales floor to its suppliers’ inventory and production schedules. They reduced their reporting cycle from as many as two days to a few minutes, and saw a 30 percent reduction in supply chain and logistics costs. (Read the case study.)
· Checkers Drive-In Restaurants Inc., the largest chain of double drive-thru restaurants in the United States, relied on spreadsheets for financial planning processes that were taking up to three months each year. By breaking away from this burden, they are now able to get the same jobs completed in three weeks, do better forecasting and more quickly respond to changing economic conditions. (Read the case study.)
It’s been said that once you break up with someone, remaining friends is almost impossible. Things just get weird.
Not true with spreadsheets. They’ll still be hanging out on the laptop, going to the same meetings and most importantly, will play a prominent role in sharing the results of the analysis across the organization (if you so choose).
But they will be frustrated by their shortcomings and say, “I wish I could’ve done better.”
For more information:
· Register for the upcoming webinar: “The Risks of Using Spreadsheets for Statistical Analysis.” (February 15 at 12:00 pm ET)
· Read the whitepaper: “The Risks of Using Spreadsheets”
· Attend our upcoming IBM Innovations in Business Analytics Virtual Launch (March 7, 2012) to see new solutions that will give you a more personal relationship with your data.