With over half a billion users around the world, Microsoft Excel is a force with which to reckon. This powerful spreadsheet tool is especially prevalent in the finance world. For over two decades, chief financial officers (CFO) have made Excel their go-to-choice when it comes to data analysis and visualization.
Despite its strengths, Excel doesn’t always provide every solution we need. The more a company grows, the more it generates data. Managing the increasing wave of spreadsheets becomes difficult, and this complicates data analysis and reporting. Fortunately, new technologies, such as Business intelligence (BI), have emerged, and they are providing businesses with more capabilities. Here’s what you need to know about Excel and BI.
Why the Finance World Loves Excel
Although technology has led to the rise of powerful tools that have more functionalities compared to Excel, a large number of finance professionals cling to Excel. Here are some reasons some CFOs are unwilling to give up on traditional spreadsheets.
- Ease of Use. After decades of experience using Excel, finance professionals know this tool like the back of their hands. Asking them to drop it and adopt a new one is a tall order.
- Cost-Effective. Most staunch supporters of data analysis Excel cite its price as the reason for using it New-generation analytics platforms are costly when compared to Excel.
- Better Ad-hoc Analysis. When it comes to ad-hoc analysis, few tools match the effectiveness of Excel. It has excellent data visualization capabilities for this function.
- Worldwide Use. Excel is the lingua franca of the finance world. Every finance professional around the globe knows how to use it.
- Interoperability with other Systems. Some CFOs see little reason to abandon Excel since it integrates easily with other company tools.
- Retraining Costs. Some CFOs balk at the idea of abandoning Excel because of the time and money needed to retrain employees on a new tool.
Why Business Intelligence is Replacing Excel
The data that the modern organization generates is overwhelming. This data may be generated internally, from customers, suppliers, or competitors. How you breakdown, interpret, and utilize this data has a powerful impact on the success of your organization. Excel sheets struggle when it comes to handling complex data, thereby denying you some useful business insights.
To smoothly transform complex data into knowledge that we can apply, we need tools with a broader scope. This is where business intelligence tools come in. BI software streamlines data collection, automatically analyzes complex data sets, provides visuals of the business performance, and gives users actionable insights.
Reasons why BI Solutions are Superior to Excel
Excel is very limited when it comes to handling vast amounts of data. For instance, opening a spreadsheet file that has too many megabytes or rows may cause the tool to display an error message. To solve this, you must split the main file into smaller files, which may affect data analysis. On the other hand, BI tools can effortlessly handle large volumes of data. With Bi software, you can open a large file fast and have a full overview of the data set. BI also allows you to combine and merge different data sets with ease.
2. Automation of Tasks
BI tools can automatically collect data from various sources, and you can schedule a data refresh. These functionalities eliminate the need for human intervention, as the software pulls data from different places and performs the data processing work. Automation also leads to the elimination of errors, which are common in data analysis Excel. When spreadsheets are complex, the rate of errors increases and such mistakes can lead to financial loss.
Although Excel offers visualization, it is limited when it comes to producing complex visuals. In excel, creating data-based visualizations is a time-consuming process. You have to carry out manual tasks such as changing cell formats and combining data. With BI, the process is automated and super fast, allowing you to create reports in a short time frame.
4. Collaboration and Distribution
Excel is a tool built for a personal computer; thus, it lacks multi-user capabilities. This makes it difficult for employees to work together. With BI, collaboration becomes more manageable, as different members can work on one report at the same time, comment, and perform modifications in real-time. You can also share the report online via different formats, and the tool alerts team members automatically. BI tools are also easy to use from your mobile device, allowing you to work while on the move.
The world is changing fast, and companies that are making good use of data are witnessing a positive growth. Instead of sticking to traditional data analysis Excel, finance professionals should utilize business intelligence tools. BI software allows you to automatically gather data, sort it out, and extract meaningful insights that you can use to set up your business for success.