Excel is one of the most ubiquitous tools in the finance and procurement professional’s arsenal – but is it really enough to solve the key spend data issues at the heart of enterprise today, and are there other, better alternatives out there?
It seems organizations themselves are unsure – a survey from Ventana Research found that only 49% said yes in response to whether they were aware that there were better alternatives to Excel for performing critical performance functions.
While Excel serves a useful purpose across organizations today, it's not the best tool to conduct spend analytics. Here are four issues you need to consider:
- Data Inconsistencies – Using Excel, its hard to keep on top of keeping your data consistent. According to Ventana Research, 44% of organizations struggle with multiple, inconsistent spreadsheets. This puts your finance and procurement departments on the back foot and means that more time is spent trying to reconcile different data formats and types. In other words, you'll never have a single view of the "truth" if everyone in your organization is using their own Excel sheets.
- Lack of Governance – Perhaps one of the biggest issues is that it is virtually impossible to maintain a suitable level of governance and audit trail with Excel spreadsheets. With multiple departments working on multiple versions, it is a struggle to maintain a single line of reporting and authority and enable management to effectively track and monitor compliance. This doesn't even factor in the volume of Excel documents which have errors. Various studies have estimated this to be at 88% - an unacceptably high level for any organization.
- What's the Right Question? With Excel's limitations, successful analytics can only occur if you know the question you need answering, and, critically, certainty that that is the right question to be asking. Excel gives you limited flexibility to slice-and-dice your data and to make decisions based on where your data takes you. Instead, you have a restricted set of options and constrained to stay along a single, predefined path.
- Limited Value – In the world of Excel, you are limited by only being able to look at the data right in front of you - it's not possible to connect multiple datasets from outside your organizations, such as supplier credit scores and other sources which, by their nature, require you to conduct near real-time spend analysis. The real value is enriching your data so you're able to view and understand your suppliers as they relate to the wider world - context is key.
If any of these points have made you think about taking your spend data analytics to the next level, take a look at our Spend Analytics tool – it gives you the opportunity to go beyond Excel and achieve levels of insight not previously possible.