March 4, 2020

How much money is Excel costing your business?

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How much money is Excel costing your business?

Excel is a great product. As a simple calculation tool it’s incredibly useful. But if you’re using it for anything beyond the basics you could be exposing your business to huge financial risk. Here’s why.

Spreadsheets are wrong

Did you know that almost 90% of Excel spreadsheets contain errors? And worse still, these errors are likely to result in financial loss for your business. While larger companies have the capacity to absorb these losses, if you’re running a small to medium business, it could be a death sentence. A simple mistyped number or decimal point could cost your business thousands of dollars.

Have you heard of JP Morgan’s $6.2 Billion London Whale? A cut and paste error cost them billions of dollars when it incorrectly divided rates by their sum rather than their average. What about Fidelity’s $2.6 Billion mistake? A missing minus sign caused one of their funds to inflate projected earnings by $2.6 billion and miss a promised dividend.  

When a single incorrect or broken calculation has the potential to affect the data of an entire spreadsheet – and you’re relying on this data to make critical business decisions – it’s a massive risk. 

Plus, with no automated self-checking functionality it’s up to the user to test the accuracy of their data. Not only is this exercise time-consuming, it’s also far from full-proof. By the time you realise something’s wrong your business could have already started leaking money.

They’re not team-friendly and can’t be shared

Construction businesses rely on collaboration. This means spreadsheets are often shared across various folders, teams, departments, and even offices. With so many people adding data to them they can get large quickly – and start to slow down. And without being able to track changes the possibility of data duplication is high. 

It also means you can end up with more than one version of the same document. Hands up if you’ve seen a folder full of spreadsheets saved like this: XYZ Sales_v.5.2_FINAL_SH. It’s not an uncommon sight. Consolidating all of this data back into one master file is virtually impossible to do with any accuracy. This means you end up making important decisions based on questionable data. Worst of all, you’ll never be able to analyse or forecast trends when your company’s data is split across various disconnected spreadsheets. It’s time-consuming and laborious. 

Which brings us to our next point!

They can’t be integrated with the rest of your business

In order to make decisions, forecast trends and identifying patterns you need to be able to collect data from all parts of your business. So if this data is saved across multiple spreadsheets, in various locations, the odds of gaining any valuable insights are low. And you can forget about trying to analyse and make predictions based on your historical data – whether that’s last week’s or last year’s!

Finally, there’s the problem of automation – or rather – the lack thereof. Spreadsheets need to be manually updated which can be a lengthy process. This means by the time you view them, the data will more than likely be obsolete. Without an integrated, streamlined system – that can capture up-to-the-minute, company-wide data – you will never be able to produce an accurate snapshot of your business.

They’re not secure

Spreadsheets contain some of your company’s most confidential information. Yet they’re often shared over email, saved on USB drives and stored on numerous desktops and laptops. Without stringent ownership controls they can be easily edited by anyone with access to them. And even if you do make them password protected, the software itself is open to security vulnerabilities. Without knowing who has made changes to your document you can’t see what’s actually been changed or why. And once changes to a document have been saved it can be difficult to recover or restore earlier versions. 

So, what’s the alternative? 

Technological advancements mean the construction industry no longer has to rely on Excel. More advanced construction project management software solutions are becoming available and revolutionising the way things are done. 

By harnessing cloud-connectivity and offering tools such as real-time collaboration, project management, version control and on-site support functionality, this tech will become the backbone of the industry. 

A great construction project management software should be:

  • Collaborative & shareable: users can use the same document at the same time without duplicating data or creating multiple versions
  • Secure: user login portals, customisable permissions levels and data security
  • Aid version control: automatic revisions so the latest version is always opened first
  • Integrated: data from every part of your business is stored on the one platform so you have a ‘single source of truth’. No more disconnected systems or spreadsheets
  • Automatically synced: data is synced to the system as soon as an update is made so everyone can view and edit information in real-time
  • Big on space: unlimited storage space so functionality isn’t affected by large amounts of data 

It may sound too good to be true but with a centralised platform offering all of the above you will be able to identify trends, save money, boost sales revenue, streamline your operations and future-proof your business. By offering improved collaboration and communication you’ll even be able to reduce error rates and boost productivity. 

Think it’s time to give Excel the boot? Get in touch with our team today to Request a Demo and learn more about Nexvia’s full suite of project management and operational tools.

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