Excel is the primary tool finance teams use for planning and budgeting. However, basic spreadsheets do not have the advanced capabilities they need to react quickly and make confident decisions - especially in times of economic volatility.
Explore the following eight common Excel challenges that many teams face and how to overcome them for better planning.
1. Manual data collection from multiple sources
Excel projects start with data entry. Disparate systems used by different teams – like finance, sales, HR, marketing, supply chain and ESG – produce data that must be collected and updated by the finance team. They need to collect and update relevant data each time a system is updated, which is time-consuming. Executive teams rely on these data sources to provide insights that mitigate risk and uncover opportunities.
SOLUTION: Integrate data from across the organization
Automatic loading processes from any system unify planning for teams across the organization. Current and historical data from all source systems should be up-to-date and accessible in one centralized solution.
2. Ensuring data integrity
It happens to every Excel user: you validate the model and check the formula, but the numbers are incorrect. The sum formula did not include the full range, and the VLOOKUP function returned the wrong results. Just one manual change can create a repetitive error that affects multiple spreadsheets.
SOLUTION: Manage data in a centralized platform
Govern and manage cross-enterprise data and formulas from a central location to avoid errors such as duplicate and missing data. Using a centralized platform as a single source of truth (SSOT) keeps data consistent and allows updates to appear simultaneously to all users.
3. Scenario planning flexibility
Scenario planning is essential in budget approval. Excel's dual role as a database and calculation engine makes comparing different assumptions and scenarios time-consuming. Teams often spend time duplicating dozens of spreadsheets just to simulate one scenario.
SOLUTION: Artificial Intelligence (AI) in action
Machine learning, predictive forecasting, and other AI tools are replacing traditional scenario planning methods, enabling always-on forecasts and scenarios to drive actionable insights and confident decisions. Centralizing business logic in one platform also enables real-time calculations and easy updates.
4. Version control and collaboration chaos
Excel templates are manually created, shared, and distributed, creating version control and collaboration challenges. Budget owners end up circulating multiple versions of their findings. Insights and feedback on data within working drafts are rarely consolidated into final reports, so management doesn't get the full story. There's no single, streamlined source of data.
SOLUTION: Real-time collaboration in a cloud-based platform
Working within a single cloud-based platform, data is captured instantly, and users can collaborate on different versions while keeping audit trails and comments intact.
5. Managing workflows and process control
Excel cannot manage workflows or provide process control when data is copied and shared multiple times. Planning often requires a top-down approach for setting goals and a bottom-up approach for data collection. Users such as sales managers typically start with an empty Excel spreadsheet for planning. They then enter their data, submit it, and get approval or rejection, all while meeting very specific standards. However, Excel is not designed to manage these workflows. It is also impossible to pre-populate goals.
SOLUTION: Automate workflows and approval processes
When workflows are fully embedded in a planning solution, it brings invaluable order and clarity. Approvals and data locks are also beneficial. Solutions that enable automatic data allocation mean that bottom-up planning does not have to start from scratch every time.
6. Protecting sensitive data
As geopolitical tensions and cybersecurity threats rise, protecting sensitive data is crucial. Spreadsheets used for planning and reporting often contain confidential and sensitive information that could pose critical compliance risks if shared. Employees' personal information is protected by law, and organizations may be in violation of certain regulations if forecast data is exposed.
SOLUTION: Govern user access and permissions
To meet security standards, planning solutions must provide templates with customized sharing controls and access levels. This helps organizations gather simultaneous inputs in a centralized system while limiting access to the right data for the right people for the right reasons.
7. Lack of data analysis and reporting capabilities
Excel and PowerPoint are common tools used to create management reports, but they have limited capabilities for deep data analysis, executive reports, and dynamic reporting. The data volume is either too massive to share, or only small pieces can be shared, which means executive teams cannot see the complete picture. This limits visibility and the ability to dig deep into the data.
SOLUTION: Accessible dashboards for all stakeholders
Visualizations bring data to life. By simply making dashboards accessible to stakeholders across the organization, you can break down silos and improve visibility by providing cross-organizational insights. This means management and other stakeholders can analyze and respond quickly to information on their laptop or mobile device, wherever they are. Reporting and planning are seamlessly connected, allowing the system to create proactive alerts to provide a clearer view of the big picture.
8. Limited data storage and templates
Excel struggles to be a multi-dimensional tool, forcing users to work with single department reports rather than templates. A mid-size organization with 10 product lines, 10 regions, and 10 cost centers can quickly exceed 10,000 spreadsheets per year, not including drafts and simulations. Additionally, making changes to a single template means updating dozens of spreadsheets individually – a process vulnerable to error.
SOLUTION: Increase efficiency with multidimensional functionality
Platforms that model data with multidimensional cubes enable users to work with templates rather than individual or departmental reports. Integrating different data sources at the application level increases efficiency across budgeting, planning, and forecasting. This enhances the Excel experience and can help guide an organization’s digital transformation journey without leaving the familiar Excel environment.
Planning and performance management technology helps teams identify risks and opportunities and stay ahead of the market. Solutions such as Jedox help teams move away from disconnected spreadsheets by providing access to real-time, cross-organizational data within a single platform. Jedox automates time-consuming processes so finance teams can focus on generating real-time insights and delivering profitable growth instead of wasting hours on manual data preparation.
If you are ready to take your financial planning to the next level, we are here to help!
(Source: https://www.jedox.com/en/resources/ebook-elevate-excel-planning/)
