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Business Intelligence Cures the Spreadsheet Problem
by Seema Haji

 
       
   

Spreadsheet Reporting

Excel spreadsheets are used for reporting and analysis in almost every corporation due to the powerful analysis capabilities that Microsoft Excel provides. A majority of business users prefer to receive their reports in Excel, a format they are familiar and comfortable with. Unfortunately, however it has been proven that spreadsheet reporting can be fraught with errors, a huge compliance problem when reports are required to reflect accurate information required to make critical decisions within an organization. Users who need information in Excel end up cutting and pasting raw data from other applications into Excel and then applying their desired formats and logic. Even though it is pervasive, this approach is inefficient, limiting and risky as it results in “spread marts” - silos of spreadsheets containing data from dubious data sources with questionable logic being propagated throughout the organization.

It would stand to reason that getting rid of spreadsheet reporting all together or replacing it with a centralized analysis solution may fix the problem. However, the question then stands, “How do corporations use a technology to implement a solution that can deliver information to business users in a format that they require while reducing the errors associated with the use of spreadsheets”?

Why do we Still Use Spreadsheets?

The popularity of spreadsheet reporting is due to the popularity of Microsoft Excel. Microsoft cites more than 400 million Microsoft Excel users and Forrester estimates that the use of Excel for reporting, namely to receive and analyze business information is high and that 50% to 80% of enterprises use standalone spreadsheets for such critical applications as financial reporting.

Microsoft Excel provides business users with autonomy and powerful analysis capabilities and hence makes it a popular choice with users to create and consume reports. As compared to the costs associated with building and deploying a complex reporting solution, Excel allows employees with limited technical skills to quickly and effectively create complex models, charts and calculations that can then be used to manage a variety of reporting functions perform analyses and make decisions.  Because of the widespread adoption of Microsoft products most individuals within an organization have at some point interacted with and manipulated a spreadsheet.  Users who are not familiar with industry standard spreadsheets can be trained quickly with limited costs.

The Limitations of Reporting using Excel

The primary problem that exists within organizations around spreadsheet reporting is the manual approach to it. A large percentage of users who develop and maintain spreadsheet reports are users in finance and sales creating spreadsheet reports based on the current need of performing data analysis. Typically, a spreadsheet report is created by hand and distributed via email. Just like with any manual process, creating and updating spreadsheet reports by hand is error prone: it is easy to cut and paste the data into the wrong cells, over-select the cells when defining a formula, mistype an expression, etc. With larger numbers of rows and columns of data, more often than not things slip through the cracks, no matter how skilled the user.  Hence, the process is not only inefficient but is limiting and error prone and can lead to huge compliance violations.

Spreadsheets lack a data audit trail.  Without a trail, it is near impossible to manage the risk of inaccurate or inconsistent information being passed around the company.  One solution would be to have IT create and maintain spreadsheet reports, as they maintain control of data and have a deeper understanding of industry standard spreadsheets.  However the process is time consuming and expensive as business users go back and forth with changing requirements. The alternative is to give business users controlled access to data and the ability to build their own reports; however what you’re left with is Excel reports that have questionable reliability.  This risk is greater when spreadsheets are used for tasks related to budgeting and forecasting, data delivery to customers and suppliers and employee compensation.

Finally, the lack of data and process control leads to silos of manually created, undocumented and untraceable spreadsheets. Too often, nobody knows who created, updated, or modified the documents, nor how they were updated or why. This leads to multiple versions of the truth, questionable results that users attack, and opportunities for mistakes and fraud, all of which pose major compliance risks.

How Information Applications and Business Intelligence Solutions can solve the Spreadsheet problem

To address the above challenges, many organizations replace Excel with a traditional, centralized reporting and analysis solution. Business Intelligence and information applications vendors provide solutions that address the end user requirement for Excel interactivity while giving IT control and manageability over enterprise data. Such solutions allow employees to continue to access, massage and report on enterprise-wide data through a format they are comfortable with, while increasing control, data accuracy and reliability of the reports themselves. 

BI solutions provide a secure way to connect and extract data from a wide range of disparate, enterprise wide data sources, provide powerful report formatting and design capabilities complete with live charts, pivot tables, formulas and more. In other words BI solutions allow reports that fully expose data in the Excel format without imposing the construction exercise on each user. Additionally features such as cell locking and matrix scripting replace manual non-compliant industry standard spreadsheets applications with auditable and repeatable processes. 

The spreadsheet reporting approach eliminates the inefficient and error prone method of cutting and pasting data with an IT-approved, automated process and makes the process easier to get the reliable information they need for themselves and for the rest of their company.

Why Business Intelligence over Home-Grown Applications?

So, why do companies pick vendor-ready BI solutions over home grown applications? Because the benefits of a deployment-ready solution coupled with added features such as data filtering, live charting and graphics, cell locking and embedded formulas far outweigh the design, development and maintenance costs associated with do-it-yourself applications.

Business Intelligence solutions give companies the competitive edge by addressing the needs of every user in the enterprise. End users, get on-demand access to the fully functional, analysis-ready reports which they need to support their business decisions. Users no longer need to wait for a report to be manually updated with the latest data. Excel report authors no longer need to go through the tedious process of updating Excel spreadsheet reports with the latest data by hand. BI solutions automate this process, eliminating associated errors and inefficiencies.

Moreover, report data accuracy is improved and organizations can get more transparency into how the business works and what can be improved upon.  Features such as cell-locking ensure the accuracy of data while providing a means of tracking the original data, when it was changed, and who made the changes.  Matrix scripting gives an organization the ability to show, analyze, and compare important information, without having to go back and create a new spreadsheet document every time a user or a customer wants a personalized view of the information. BI solutions can scale both horizontally and vertically to support any size user population, giving IT the peace of mind that the solution will not be outgrown.

Finally, creating a centralized reporting system addresses the needs of end users for Excel interactivity, while allowing IT to stay in control of the data, security and management, thus solving common spread mart problems. This leverages existing Excel expertise, resulting in lower development, maintenance and training costs.


       
   
 
       
   

The Author

Seema Haji is a senior technical marketing manager with expertise in competitive intelligence and sustainability management at Actuate. She oversees market analysis and the development of customer usage scenarios that allow Actuate to differentiate itself from other vendors in the market. Prior to joining Actuate, Seema handled business process analysis, evaluated BI products and conducted buyer-side requirement analysis. Seema has a Masters degree in Computer Science from the University of Southern California and a keen interest in sustainability and eco-friendly living.

Actuate, founder and co-leader of the Open Source Eclipse BIRT (Business Intelligence and Reporting Tools) project, is dedicated to increasing the richness, interactivity, and effectiveness of enterprise data, for everyone, everywhere. The company's platform boasts high-performance, proven RIA capability; a highly collaborative development architecture; the world's largest open source information application developer community; and a long history of customers deploying Actuate-based solutions for dozens or even hundreds of their mission-critical applications. Visit www.actuate.com for additional information.

 
       
   
 
       
   
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