The notion that spreadsheets ever went out of fashion may be misplaced but the last six months has seen a surprising upsurge in interest in what the spreadsheet has to offer. For many years the audit profession and many in the software industry have countenanced against an over reliance and dependency on spreadsheets. One vendor, of spreadsheet management software, Cluster Seven even parodies the drugs industry in some of its sales literature about spreadsheet addiction. But whatever the shortcomings of spreadsheets the truth is that industry and commerce cannot live without them, says Gary Simon, FSN's managing editor.
ComplyXL highlights spreadsheet changes graphically
Spreadsheets seem to mushroom in most organisations often 'papering over the cracks' in reporting systems and other applications which are poorly served by off the shelf packages. The infinite flexibility of spreadsheets is liberating for users who can create worksheets to exactly their own specification with little in the way of IT training and computer skills.
In fact, spreadsheets are often strung together in 'virtual' applications that support complete processes. For many organisations this is a perfectly reasonable way of achieving precisely what they want at low cost and without burdening the IT department.
It is also one of the drivers behind a new breed of organisation such as XL Cubed which specialises in providing web-based spreadsheets as the way forward for organisations that do not wish to deploy complex Business Intelligence tools to every user in the organisation simply to give them a basic reporting capability.
In a rapidly consolidating market in which BI vendors are seemingly merging every month then spreadsheet based reporting systems can provide a very acceptable way forward, at reasonable cost and without the commercial risk that your major BI supplier may be taken over at a moment's notice.
Tools such as XL Cubed are spreadsheet 'add-ins' that harness the best bits about spreadsheets without having to purchase a whole BI suite of software. Effectively, the spreadsheet is used as a 'window' onto an OLAP database or ERP system that allows data to be retrieved for enquiry and reporting but within a controlled environment. The fact that it is very affordable and available over the web is beginning to make it a very attractive proposition for large corporates that need to deploy an 'easy to use' reporting tool across the enterprise but do not want to incur the cost, development and implementation time associated with traditional BI tools.
XL Cubed is not alone in this endeavour. PerformancePoint Software, is also a relatively new vendor, attacking the soft underbelly of the Microsoft Dynamics user base. PerformancePoint, founded by Dr Nigel Geary, a veteran of the software industry is aiming to open up the concept of simple to use Business Intelligence in mid-market ERP, concentrating on the Microsoft Dynamics brand of software by providing easy access to the underlying data out of the box, with its spreadsheet add-in.
However, for some people the unfettered growth in popularity of the spreadsheet is a worrying trend. Spreadsheets are a victim of their own success, for example, the flexibility which makes them such an attractive reporting tool is also their undoing. Almost every finance professional has a 'war story' to tell about a spreadsheet error that gave rise to a substantial financial loss or embarrassing mistake. The ease with which it is possible to overwrite a formula with data or to adjust the wrong version or inadvertently copy the wrong formula are just some of the normal hazards of working with a spreadsheet.
Not all occurrences of spreadsheet errors have dramatic consequences. In many instances there are overriding or compensating controls that act as a safety net in the event of a major error. For example, an apparent overspend reported on a spreadsheet purely because of a typographical error may be caught when actual spending is compared to budget at a month end. But not all errors are that easy to trap and there is no doubt that some errors are very damaging.
The risk all depends on the criticality of the spreadsheet. Every organisation has a mission critical spreadsheet or two which it would not want to contain an error. Bank covenant calculations, cash flow projections and proposed pay reviews are just a few that spring to mind.
It is concerns such as these that have spawned a new genre of software packages on the 'other side' of the spreadsheet industry which are designed to protect users from spreadsheet errors. Unlike the earliest incarnations of these tools which simply logged errors in unintelligible scripts that only auditors could understand, the latest generation of products from companies such as Liquidity make extensive use of graphical displays and appear easy to use.
Lyquidity Solutions was founded in 2001. The founders had a long history of developing Business Intelligence applications and recognising the concerns about the lack of controls around the use of spreadsheets developed ComplyXL. It will easily compare spreadsheet versions and graphically display where cells have been changed. It can home in on specific kinds of changes where necessary to cut down on the amount of information displayed. The desktop version is around £200 and an enterprise solution is available at around £5,000. It means that cost is no longer a barrier for individuals and companies that wish to check the integrity of a spreadsheet or the changes that they have made. Cluster Seven operates in the same space though has made something of a specialisation of the higher end of the market and dealing environments in financial services and energy trading.
It seems that for a number of organisations the spreadsheet approach provides a simple and affordable way of providing end users with a low risk reporting environment. But for those businesses that still harbour concerns about Excel proliferation then there are companies such as Liquidity Solutions that can provide an additional level of comfort.
Related FSN articles:
FSN Product Review, ClusterSeven Enterprise Spreadsheet Management Software
