Hell in a cell: The cost of spreadsheet misuse

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Valme Claro
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AccountingWEB.co.uk
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A study commissioned by Alteryx has found spreadsheet users spend much of the time doing manual and repetitive work when the data sources are updated, wasting a substantial amount of money and man hours every year.

Any regular Excel knows that repetitive work and manual processes constitute a big part of the time you spend using the programme.

Despite this, and although there are alternatives, most businesses choose to keep on using Excel, mainly because of the range of calculations and analysis it offers. However, the study conducted by IDC and commissioned by the self-service data analytics company Alteryx titled “The State of Self-Service Data Preparation and Analysis Using Spreadsheets” has found the cost of this persistence: $12,000 (£8,800) per annum, to be exact. Extrapolated across the entire American economy, it constitutes an average of $60 billion wasted every year.

The problem seems to be in the use of Excel rather than the programme itself: “It's not really Excel or any other spreadsheet that is responsible for the supposed $60 billion black hole,” says Simon Hurst, founder of The Knowledge Base and AccountingWEB contributor. “Instead it is the lack of knowledge of how to use a spreadsheet properly, or how to avoid using a spreadsheet in the first place, that creates this level of wasted time and effort.”

According to the IDC/Ateryx report, spreadsheets' most advanced users, around 8% of all the enterprise employees, use Excel mainly to perform activities such as what-if analysis, cleansing, and prepping data. These users typically spend 26 hours per week working with spreadsheets performing activities such as summarizing and manipulating data and doing statistical calculations. However, up to 8 hours per week inefficiently spent on repeated effort when data sources are updated.

The use of copy/paste is the most common of these inefficient operations, mentioned by 81% of the interviewed users as their method of data acquisition. The report defines the operation as a key contributor to inefficiency and waste, typically related to errors and compliance issues. In fact, previous research has shown that almost 90% of spreadsheets contain errors. 

The white paper includes final recommendations to tackle the problem of the hours wasted on the preparation and analysis processes, including converting to different tools and software as an alternative to spreadsheets. However, with the use of Excel still widely spread across different industries, finding new ways of using spreadsheets, it seems, is the best immediate solution. 

Download the Alteryx report for more information on the causes and effects of the inefficient use of spreadsheets.

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20th Sep 2017 10:31

$60bn wasted because of spreadsheets every year! It's great that an entirely disinterested party such as Alteryx is able to share this with us - and prepared to do so merely in exchange for name, company, business address, email and phone details.

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By shurst
to johnfrancis
21st Sep 2017 08:10

Do I detect just the merest hint of irony there...

It's about time a really disinterested party undertook some credible research in this area. Alteryx might have a vested interest, but there's probably a lot of truth in what they report.

I should also add that, as an Excel trainer and consultant, I'm about as disinterested as Alteryx - but I do see first hand just how much time is wasted for want of a relatively small amount of additional spreadsheet knowledge and expertise.

Thanks (1)
24th Sep 2017 21:55

Excel, as a spreadsheet program albeit quite a sophisticated one, is a general purpose tool. As such, when used to run accounting functions in a repeatable and consistent fashion it needs a significant amount of embellishment which means macros and programming.

With tools like C and Visual Basic one can even extend it build your own accountancy system but that is a specialist job and beyond the average user.

I think a significant issue is that specialist accounting packages (you know who I mean) are ironically perceived to be too difficult for some people and as such the cost/benefit is not attractive. People then use Excel because they already have it and it is therefore 'free'.

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