fbpx

Por Plika

Do you know why finance leaders are looking to leave the spreadsheet behind? The modern era and new needs have marked a corporate trend to automate tasks.

The objective is, among others, to obtain the maximum benefits provided by the data, performance, and, therefore, greater profitability. The truth is that Excel has become a commonly used tool, which represents a solution for many companies, although with a considerable margin of error.

So, do you think that decision-making and the dynamism to which organizations are subjected are compatible with Excel? Or is a Financial Planning & Analysis solution relevant as an ideal alternative? Find out below.

Main financial problems to face with spreadsheets

Hoja de cálculo en las finanzas

Foto de Freepik. Licencia CCO.

In the business context, it is essential to have efficient, agile tools capable of providing the finance team with a productive environment.

 

The spreadsheet continues in many companies, even when it does not completely solve the financial problems. It is a tool that absorbs a lot of valuable time, with a wide margin of human error.

Now, how to achieve it if the available resources do not solve goals such as Cash Flow or provide information in a timely manner? Up-to-date data, analysis and decision making go hand in hand, as does the fast pace of everyday life.

Faced with a high demand for responsibilities, financial management and design of corporate strategies, what to do? The solution is far from choosing the famous spreadsheet.

Its result is limited and curtails the possibility of providing a functional vision. It is necessary to develop in the current financial market through really effective strategies, through FP&A.

Know the conflicts that arise and you will have to face, if you decide to continue using the spreadsheet. Let’s see.

Unproductive due to lack of time

The spreadsheet, despite being widely used by many companies, reveals an undeniable reality. It is slow and does not offer security to your operation. In short, negative elements that do not provide productivity to the organization.

This only translates into a tedious process when managing Excel, which requires constant review of many pages. A task that you will have to face, dedicating hours that you could take better advantage of.

This valuable time could be used on strategic tasks for the modern finance professional. Quite the opposite of FP&A: a more advanced and versatile tool that provides greater speed, providing the ideal environment for continuous production.

A phrase that we usually hear from our leads: “I spend more time putting together and updating Excel than analyzing the information that is in it.”

Unclear display

Having the spreadsheet does not offer you an exact vision of what you should do to improve, for example, financial planning or profitability for the month.

With unclear data and scattered information, it is not possible to make decisions or offer solutions to the board. Worse still, you run the risk of presenting your insights based on unreliable information.

A phrase that we usually hear from our leads: “When I introduce the directors from the inside, I hope they don’t ask me specific things about Excel.”

Historical data tracking

Knowing the history of previous years will allow you to know what to do this time. In addition to not repeating the same mistakes of the past. This is not easy by using Excel spreadsheet.

The main challenge is to connect information from the accounting system, which comes in a certain format, with the information from the projections, which probably has another structure.

Identifying a problem, analyzing and evaluating data is not the reality of an outdated system.

A phrase that we usually hear from our leads: “Extracting and comparing real information at the end of the month is an odyssey.”

Manual entry

Having a spreadsheet in the company’s finances does not represent avant-garde or a functional and practical system. Therefore, the tasks become quite heavy, they can become uninteresting and generate discomfort in the team.

Faced with the need to deliver results in a short time, the teams are affected, if they only have the spreadsheet. Loading a large amount of data manually slows down the process and makes the system inefficient.

Each data is necessary, each detail must be manually loaded. This generates incredible delays that do not facilitate or promote peace of mind for anyone. Also, it is not functional to design growth strategies.

A phrase that we usually hear from our leads: “In the budget, each area has its own spreadsheet, which I then have to manually consolidate into hours and hours of work.”

Forecast and projection analogy

What will be the future or situation that the company must face? What to take into account to avoid the repetition of certain types of scenarios? Between forecast and projection there is a similarity.

Both are done for the benefit of the company. But a friendly, versatile and effective system that provides answers is required. Make it work to design solid strategies.

The Excel spreadsheet does not allow you to execute well-structured projections or more complex forecasting analyses, sometimes by modifying some formulas, you have to make sure that in the next sheet we do not see errors.

A phrase that we usually hear from our leads: “Today it is difficult for me to play scenarios before making a decision, I have to be careful not to break Excel.”

Advantages of leaving spreadsheets behind

Hoja de cálculo y problemas manuales

Foto de Freepik. Licencia CCO.

Among the great benefits of leaving the spreadsheet behind and choosing FP&A is the simplification of processes. You will have more time to evaluate and make appropriate decisions based on real data.

In addition, you will be able to standardize the system and have such a flexible environment that you will be able to adapt it to the needs of any client. Learn about other benefits below.

Long term projection

Anticipating various situations as part of a financial control in the organization will not be 100% part of your achievements using the spreadsheet.

Projecting requires an extensive analysis that is only generated with fast and reliable data. The company will be able to prepare, avoid negative scenarios, or at least intelligently navigate them while growing financially.

Integration of data from different sources

How to have solid information from various sources by using the spreadsheet? The way to load the data in Excel is manual, which means an unreliable process.

The reason is that this dynamic affects the quality of the data. In fact, working with multiple sources increases the possibility that the update will be late.

Data integration with FP&A allows you to connect and consolidate the data you want by concentrating it in a single source. So you can have only one model of the shared data.

Here is an example of the information architecture in Plika, on the left the actual and historical data, and on the right Plika’s ability to use it to generate projections and analytics.

Hoja de cálculo o fiabilidad

Reduce errors

Do you trust the information from the data analysis obtained through the spreadsheet? In a company there are multiple users that operate without integration or proper communication.

This generates a large number of versions, inaccuracies and a derivation of inconveniences. FP&A allows you to reduce errors as it is a versatile system, adaptable to changes and more advanced in financial terms.

Efficiency and reliability

An efficient and reliable system is synonymous with success, not only in the financial area, but throughout the company. It multiplies the optimization of the work of each member and supposes a more pleasant environment when analyzing scenarios.

Leaving the spreadsheet behind is the first step to gaining efficiency and confidence in data. In addition, you will be able to free yourself from tedious loads and automate processes, which will provide more time for analysis.

This will benefit you beyond financial consolidation: it generates information to improve practices in the future. And not only for the financial team, but for the most relevant and decisive operations of the company.

Accurate information

By having reliable data, it is possible to obtain accurate information on each area and process of the company. This is key to designing effective strategies that attack real problems without focusing efforts in the wrong places.

 

The FP&A tool represents an advance compared to the spreadsheet. They can operate together but in a strategic way from the power and precision of Financial Planning & Analytics.

 

In addition, it enriches the company’s view of the finance team, because they recognize your team’s work as a strategic ally in terms of decision-making.

Conclusions

The spreadsheet is an element that has not yet completely disappeared. In companies, it deserves a lot of thanks, and although it may represent a solution, to date it has some limitations.

FP&A faces the financial future and at Plika we know it. Access software capable of executing your tasks, meeting your goals and more.

We accompany you and provide training and consulting, if you want to improve your financial operation. Step into the future with Plika.

Newsletter

If you want to get new articles, you are welcome to subscribe to our newsletter!

Close Bitnami banner
Bitnami