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Removing Excel Roadblocks: How to Solve 3 Common Concerns in Financial Planning

Highway against mountains.

You’ve been down this road before. The road where finance relies on Excel to travel into uncharted territory. The road where Excel’s usefulness as a data tool is mistaken for competence in planning and analysis. Plenty of finance departments demand of Excel more than it can handle. They’re simply not aware of its limitations or the alternatives, even though Excel, despite its reliability as a data aggregator, has shown time and again that it is error-prone and fragile as a planning system.

Look at your fuel gauge: Do you spend too much of your day tracking down and cross-checking data? Does your executive team argue over data authenticity or which piece of data is the single source of truth? Are you bogged down in the grunt work of data curation when your company (and your sanity) demands more big-picture analysis? If so, it’s time to embark on a new journey—one that not only affords you the familiarity of, but also complements, Excel. One with a user-friendly planning and analysis system that moves finance into the strategic role every high-performing organization needs.

Watch the webcast 10 Most Popular Excel Tips and Tricks (and When to Use Them)

Hitting the road
How can another system complement Excel? To answer that, let’s hit the road. Whether it’s a short drive to the market or a longer journey cross-country, when planning most trips you’re going to plot a course that avoids roadwork and traffic, sends you on the fastest route possible, and is a seamless experience. To achieve this, you need vision. You need clarity. You need speed. Do you need Excel?

Yes, and more. Excel is an old reliable for navigating local data routes, but take it on a road trip and it starts to show its age. The windows are cloudy, the tires are worn, and the miles per hour max out at 65. Worse, there’s no GPS on the dashboard, let alone built-in. Because your Excel vehicle doesn’t provide a clear view of the road ahead, you have no idea what to expect or whether your old reliable can navigate you through it.

In fact, a customer once shared an analogy with me at a conference. He said that planning in Excel is like driving a car with its headlights in the back; it can help you look back at what happened in the past, but does a poor job of letting you know what is coming up ahead.

Not convinced yet? Here are three key ways relying only on an Excel-based planning system hinders your productivity and profit.

  • Time sink: Excel devours time because it’s error-prone and requires a lot of manual care and feeding. Finance teams end up spending the majority of their hours in spreadsheets, wasting time that could be used for more strategic, high-value work. And if a company wants to scale up or collaborate, the slowness of Excel makes those tasks even more challenging. Tedious ad hoc reporting tasks, manual data aggregation, and hours spent validating formulas and spreadsheet cells leave little or no time for strategic, analytical, and collaborative work. Not surprisingly, CFOs consistently cite “not enough time” among their top challenges in a recent CFO Indicator report.
  • Unreliable data: Because Excel data is often siloed and department-specific, it reduces trust in data across the organization and makes a single source of truth all but impossible. For example, it’s not unusual for larger organizations to have multiple Excel formulas to achieve the same metric. The result: wasted time debating which data and metrics to use instead of discussing how key data and metrics can benefit the business into the future. Excel-based planning thus impedes an organization’s ability to be make quick, data-driven decisions in a fast-changing world.
  • Cloudy view: Excel offers limited and uneven visibility into the business operations and drivers that are central to the success of any organization. As a result, decisions remain gut-based instead of data-driven. At a time when business technology is rapidly changing, Excel simply doesn’t have the horsepower to generate dynamic and integrated insights that can help drive strategy and inform decision-making.

Going places
Now imagine, before your road trip, you upgrade your old-reliable car. Nothing too flashy, but maybe you add some kick, new glass so clear it’s invisible, a built-in GPS that never fails to keep you on track. You’d see roadblocks far enough in advance to avoid them, and you’d zip along to your destination in no time. The trip would be more enjoyable and more productive. You’d still know the car like the back of your hand—it’s still the ride you’ve come to trust—but now it’s also primed for long-distance visioning.

An integrated planning and analytics solution is this upgrade. It’s designed to complement Excel by freeing up valuable time for more strategic activities and deep visibility into your business. By creating a centralized repository that integrates all of your data, it provides a single source of truth that improves integrity and gives you confidence in planning. Now, instead of poring over spreadsheets, you can bring your Excel data to life with dynamic, customizable dashboards. This solution empowers finance to report, analyze, and produce a view of the KPIs in an accelerated and self-service way.  In other words, planning and analytics are no longer separate activities, but are seamlessly integrated. They tell a story the finance team can act on, and inform strategic decision-making that drives business performance.

This is not uncharted territory. Many modern finance teams have added a system that empowers finance to do efficient, long-range visioning, reaping significant benefits along the way. Case in point—one construction firm that integrated Adaptive Insights’ dashboards into its finance operations was able to develop a scenario analysis that determined the company was headed toward costly excess manpower in the final quarter of the year.

Relying on the analysis, the construction firm’s finance team partnered with the CFO to develop an action plan to get new projects in the pipeline for the fourth quarter. The plan worked, resulting in a positive swing of more than $1 million for the company. The finance team says it simply would not have been able to conduct the analysis and solve the problem if it had solely relied on Excel.

If you’re satisfied traversing life via a series of short jaunts to local spots like the coffee shop, the market, and the post office, keeping old-reliable as-is may be the right move for you. But if you want to strike out and see more of the world, adding those extra bells and whistles might be critical. And in today’s landscape, where the only economic certainty is uncertainty, isn’t it crucial for finance to be ready for any of the road’s twists and turns? After all, finance needs to be agile and efficient enough to quickly plan for multiple scenarios. Big data is only growing bigger, and with cloud-based planning tools to complement Excel, finance can now present the right insights to guide decision-making.

Just as cars compete on performance, today’s business competes on analytics. That’s why speeding ahead in this new economy may mean charting a new course for finance that adds to Excel with proven cloud-based planning tools. It’s the kind of upgrade that could very well put you on the road to success.

Want to learn how a best-practice, active planning process can help you drive business success? An active planning process is collaborative, comprehensive, and continuous—one that results in a better business plan. Better budgeting and forecasting. You’ll get greater visibility into business performance, build confidence in the numbers, make data-driven decisions, and increase buy-in and accountability throughout the organization. Learn more here.

Written by Maneesh Chhabra, director, value engineering and enterprise marketing, Adaptive Insights

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