Will the native pivot function change the way accountants use Excel?

Evan Goldberg at SuiteWorld 2018
Tom Herbert_SuiteWorld
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NetSuite’s recent announcement of a native pivot function, allowing users to pivot data from within their software instead of exporting it to a spreadsheet, poses some interesting questions about how accountants will use Excel in the future.

Here on AccountingWEB we’ve read so many articles on the death of Excel we were thinking about setting up a spreadsheet for them. No one is predicting yet that accountants will suddenly ditch Excel, but the dawn of the native pivot function could mark a new relationship between accountants and Excel and a change in the way the humble spreadsheet is used by finance teams.

PivotTables are one of the most popular features in Excel – still the most-used accounting tool in the world. PivotTables have been on the scene since Excel 98, and compared to traditional formula-based tables they allow users to effortlessly manipulate large volumes of data into different views without slowing the spreadsheet down.

However, they do have their drawbacks. For each query you need to export the data from your accounting package and set up a bespoke table. And as accountant Nick Brown recently pointed out PivotTables do not automatically update themselves, so if you change anything within your source data, you need to refresh your table.

‘Raving reviews’

NetSuite co-founder Evan Goldberg told the Suite World audience in Las Vegas that the Suite Analytics tool would soon include queries, pivots and charts.

“Customers in beta with us have provided feedback over the last few months, and we got raving reviews so far,” said Goldberg.

In a demonstration during the same session, Joav Bally, NetSuite’s VP of product management and engineering, used dummy company figures to pivot sales data to show year-on-year sales per quarter, then drilled down into the data to look sales periods for a specific region (full video demo below).

Speaking to AccountingWEB after the event Bally confirmed NetSuite had built the tool from the ground up, and that the native pivot function will be made available to Suite Analytics users later this year.

Will this make accountants pivot from Excel?

Despite all the fireworks and razzmatazz in Las Vegas, the pivot function was the one thing accountants wanted to talk about on the show floor. So why all the fuss? After all, a lot of enterprise accounting systems already analyse data internally, and there is a semantic debate around where you draw the line between producing general analysis and replicating what a PivotTable does.

The main advantage of NetSuite’s native pivot function is that it addresses the set-up time and lack of live data within Excel PivotTables. Being able to manipulate real-time data with pivot-like tools is akin to using Excel’s secret weapon against it, and the ability to stay within the accounting system could save users hours of time.

Moving the point of intelligence

According to Hugh Johnson, an AccountingWEB contributor and vice president of financial data analysis platform Suntico, NetSuite aims to embed intelligence right down into the lower level transactional software makes a lot of sense.

“If you move the point of intelligence as far back up the chain as you can and get it closer to the raw transactions, it could be a game-changer in terms of delivering better analysis from a company’s transactional data,” Johnson told AccountingWEB.

However, he continued, we are still a long way from the native pivot replacing Excel: “I don’t think it’ll cut Excel out of the loop. People love Excel, they’re familiar with it and you don’t need a NetSuite licence to consume an Excel report.

“So often with technology, a new tool comes out and everyone thinks ‘this is going replace Excel’, and actually what usually happens is you end up with an ‘and’ situation. What I suspect will happen is that you’ve got people who are so used to using Excel that they’ll always fall back onto the familiar – so 10 minutes before a board meeting a finance director will still use a pivot table in Excel to pull together a last-minute report and email it round. This is obviously fraught with danger, but it’s just so easy.

“Where I think it could be a nice facility is that it will make it easier to pull the data into Excel in the form that you want it in the first place. In that way it might encourage greater use of Excel!”

Taking the friction out

AccountsIQ CEO Darren Cran is well-qualified to discuss this topic, as his firm has recently released a pivot dashboard that allows users to select the dimensions they wish to report on - for example to see data by country or region - and take away the bits that are not relevant at point in time.

For Cran, these functions save finance team time.  “Rather than have to run a report or get one built for you, this allows you to drill down into what you’re looking for immediately,” Cran told AccountingWEB. “We see it as taking the friction out.”

While he agreed with Hugh Johnson’s verdict that the native pivot was unlikely to kill off Excel any time soon, Cran said increasing use of such tools may signal a shift in the way it is used over time.

“I can’t see Excel dying,” said Cran. “It gives you freedom and flexibility. Excel allows for a lot of ad hoc data analysis. It allows you to maintain curiosity around data – if you just stick to the software you miss the freedom to be curious with data. That will never go away.

“However,” he continued, “it will morph over time. Pivot functionality allows you to strip out a lot of repetition.

Cran is also hopeful that Excel will become a lot less relevant to financial reporting.

“Business will really see the benefits of not relying on Excel for reporting – it takes the time and error out. When reporting relies on Excel it fails over time.

“Excel is brilliant for ad hoc data analysis – this is where its long-term future lies, as a freestyle data analysis tool.”

How worried is Microsoft?

Specialist financial analytics developers have a habit of overlooking one of the key players in the market – Microsoft. Although the Windows and Office giant has a patchy track-record when it comes to catering for finance professionals, it has already anticipated the native analysis challenge with its own PivotTable extension: Power BI.

Initially released alongside Excel 2010 and refined into a powerful data extraction and analysis suite, Power BI connects all kinds of live data into a spreadsheet-based reporting environment. Once the system has been plugged into your source data, it too can generate dynamic analyses.

Configuring Power BI is a challenge and the specialist skills needed to make effective use of the system are still in short supply, which opens the door to native analysis tool, or hybrids like Hugh Johnson’s Suntico that sit on top of Microsoft’s analytical engine.

AccountingWEB’s software surveys show users prefer to use tools they don’t have to tinker with or pay extra for to get the results they want, which should work in favour of NetSuite and AccountsIQ.

The suspicion remains that native pivot tools won’t lure away “power users” like the 11th hour pivot FD earlier – these Excel addicts are likely sustain Excel use within accountancy for many years to come.

Do you see your analysis techniques changing in the near future? Are you tempted by native analysis tools that let you interrogate transactional data within the accounts system, or are you an Excel diehard who has no truck with these lazy fripperies?

 

About Tom Herbert

Tom is editor at AccountingWEB, responsible for all editorial content on the site. If you have any comments or suggestions for us get in touch.

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14th Jun 2018 12:04

Tableau has been predicting the death of excel. How many people know or heard "Tableau"?

What would be a killer to excel is "Spreadsheet on a cloud".

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14th Jun 2018 13:15

Refreshable spreadsheets using ODBC have been available for many years. They can be a bit tricky to set up but once they're done, they just work. Its a thing of beauty

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14th Jun 2018 22:14

I don't see Excel going away any time soon or even later. Although it has its flaws, it just does some things so much better than the alternatives. Just like the alternatives do some things so much better than Excel.

The good news is that it doesn't have to be "either/or". It can be "and". For example, one of the many things that Excel does really nicely is data entry to support budgeting, forecasts, targets, "what-if" scenarios etc.. You can just type in raw or calculated values alongside your actual values pulled in from your accounting / ERP software. This is typically either not supported or very restrictive or cluncky in most BI tools or accounting / ERP software.

For robust, yet very flexible analysis I think that a killer combination is Excel AND Power BI. Especially with Excel Online (which has most of the features that most people use in the desktop version). You can set up Excel Online as a live datasource for Power BI right down to an individual cell or array of cells. So I think that you can have your cake and eat it!

Or maybe I am just a geek :)

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15th Jun 2018 11:31

As others have already touched on, I think Excel's greatest strength is its flexibility - yes there will be more specialised tools that can perform a better job of specific tasks but I think there will always be a need for more generalist tools in any computer-based environment and that's what makes Excel so useful.

I use Excel a lot in my role and another great strength I find with it is the VBA automation - although VBA isn't exclusive to Excel, to me at least it seems to have the most widely available documentation and help resources online and it's amazing how, with careful programming, you can even use it as a vehicle to automate non-Excel tasks also.

In my opinion the only likelihood of Excel being killed off is if either Microsoft chose to discontinue it, or some other big IT player decided to enter the market with their own spreadsheet software and succeeded in packing their own version full of greater features and/or usability and thus out-competing Microsoft on it. I can't see either of those situations occurring any time soon I think Excel is here to stay with us for some time yet :)

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to Ben Lauritson
16th Jun 2018 17:19

Ben, I agree with you. I suspect that Excel is one of the greatest contributors to Microsoft's profits, so is unlikely to be discontinued any time soon and I think the functionality bar is set so high to make the prospect of a new functionally-rich entrant unseating it unlikely also. I think the most likely form of demise will be other tools chipping away at specific use-cases, or from more left-field like a creeping use of Google Sheets because it is there in my Gmail account (and Gmail is I believe the most widely-used email system on the planet). Google Sheets is so far behind Excel online though, but it is a lot cheaper or even free for most users. There are many premium giants that have been attacked and unseated from underneath.

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14th Sep 2018 16:17

Excel is not going anywhere, its just so cheap and effective why would you use anything else.
To be fair as already mentioned Excel is best at summarising data, however normally the data is they used on Accounting and taxation software or other management report software.
Excel is always the starting point, but no longer the final delver of reports and returns.

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