The curse of the spreadsheet: what happens when Excel gives you (false) security

Excel excels at giving users a strong sense of security. How many times have you witnessed this scene played out in organisations: armed with a ‘dashboard report’ the likes of which the company has never seen, your controller struts into that board meeting, looking every inch the fiscal superstar. Excel is often seen as the magic formula for making a whole host of business decisions. But is Excel in the midst of its own mid-life crisis?

With the 30th anniversary of the first spreadsheet upon us, the original “killer app” and vehicle on which the PC first rode to fame doesn’t quite add up. The existence of “rogue” spreadsheets spreading through an organisation can turn logic on its head. The problem is tracing the errors in such a manual process. Is it down to Microsoft’s “interoperability”or just your colleague having a bad keystroke day?

Are spreadsheets responsible for the downturn? When spreadsheets, not people, become the decision makers then certainly, chaos can ensue. Consider the following: The European Spreadsheet Risk Interest Group analyses and quantifies the cost of spreadsheet errors worldwide. In the last six months alone, they have reported various situations, including:

A well-known medical and consumer imaging company had to amend its third-quarter loss by $9 million, announcing that the adjustment was needed because too many zeros were added to an employee’s accrued severance on a spreadsheet; the company’s CFO characterised the situation as “an internal control deficiency”

The many add-on tools that have appeared on the market to cushion Excel’s weakness when it comes to error protection and auditing is the strongest witness to the case. Excel is seen as ‚BI Tool No. 1′ but financial controllers must ensure that a company’s numbers aren’t spread across numerous desktops in isolation; and apply enduring standards, for example by connecting Excel, OpenOffice Calc and web-based online spreadsheets by one common, commercial-strength Open Source database.

Palo takes the risk out of Excel and delivers a single version of the truth: safety in numbers, down the Chinese walls.