Despite what reporting vendors might want enterprises to believe, spreadsheets are here to stay--the key for coping is to understand and manage them.
Posted Apr 3, 2007
Spreadsheets may be BI's biggest dirty little secret. In almost all BI software case studies the answer to the question, 'What was your company using previously for business intelligence?' is a sheepish, 'Oh...just Excel.'" However, a new study from Forrester Research indicates that spreadsheets are currently the most popular BI tool and are not going anywhere any time soon. The study, "Ouch! Get Ready--Spreadsheets Are Here to Stay for Business Intelligence," claims that spreadsheets are a permanent fixture in companies of all sizes and across all verticals. The report argues that instead of trying to remove spreadsheets from the enterprise, companies should learn to manage, understand, and optimize their use.
"For years all these specialty reporting vendors tried to sell us the idea that you don't need spreadsheets: 'Do everything on our application!' That has totally, absolutely, undeniably failed," says Boris Evelson, a principal analyst at Forrester and author of the report. The report states that according to Microsoft, there are more than 400 million Excel users worldwide. Most of these users in businesses are using Excel to power various business functions, which can be grouped into spreadsheets' use as data sources, transformation mechanisms, operational applications, and reporting and analysis mechanisms.
Spreadsheets offer benefits to users and dangers to companies. "There is no way anyone is getting rid of spreadsheets, but they absolutely do cause tons of problems, especially risk problems," Evelson says. The study cites that an estimated 50 percent to 80 percent of companies continue to use standalone spreadsheets for critical business functions; however, 90 percent of spreadsheets contain some errors due to bad formulas, incorrect data entry, and errors in access and placement of data.
Although spreadsheets are problematic, companies must try to overcome these issues rather than attempting the unrealistic effort of nixing spreadsheet use altogether. Companies should implement budget and planning applications alongside of spreadsheet to monitor and measure them as well as prepare for future investments. The report offers up the possibility of spreadsheets moving from the desktop to the Web, but argues that there is not a Web solution strong enough yet to power this kind of activity.
The most important thing for companies to do is to control spreadsheet use, according to Evelson, using both best practice approaches and technology to support this. Simple efforts like scanning spreadsheets daily and looking for deviations from the norm can help prevent error. He cites Microsoft's development of the SharePoint Server, which helps companies with content management and information sharing as a move in the right direction. Evelson says, "Try to make spreadsheets just like any other valuable application in the organization. Control them, audit them, test them, and monitor them. That's what one needs to do."
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