Microsoft Excel significantly refined over the past few decades. However, new features prompted people to use it in ways the program was not designed for. For one, Excel is not a database. Yet, many people use it as one. While the program can serve this function for small datasets, it can exceed Excel’s limitations as soon as a small dataset grows. Let’s find out what we should not use Excel for to avoid any unnecessary complications.
Limitations of Excel
Not a CRM
We all know that implementing a new system can be very expensive. This is why many start ups and small companies choose to use Excel spreadsheets as much as they can. However when a business, using Excel as a CRM becomes complicated.
While Excel can work well with other Microsoft Office products such as PowerPoint, Access, or Word, if a part of your business depends on non-office software, transferring information between programs can be a hassle. Sure, many systems and software have options to import/export data using Excel files which means we can export data from one system and import into another software. However almost all of these software require the spreadsheet to be in a particular format and layout. This means manual intervention will be required which also means there is room for error.
When you struggle to create seamless processes with Excel and other systems, it’s time to switch to CRM software. A dedicated CRM software can help you manage your data better. You will be able to keep complete track of your customers and finances.
Cannot Handle Too Much Data
When data files are too large, Excel can run very slowly. You can lose a file if you attempt to break the data into smaller files. In addition, many users don’t consider Excel as user-friendly. Because Excel is so flexible with what you can do with it, it is not the most intuitive system to use. So, unless you know how to use all the tricks and formulas to calculate data, Excel can do little to help you.
Risk of Human Error
Misaligned rows and missed negative signs sound harmless. However, they cause considerable damage. On average, a spreadsheet contains one error for every twenty cells with data.
Whenever you make any changes in Excel manually, there is a risk of compromising accuracy and making errors. All these mistakes can have adverse effects on the bottom line. Excel may have certain error messages and alerts in place to help us with this, however there are also situations where errors may not appear. An obvious example would simply be referencing the wrong cell in a formula.
The only way you can validate data is to double-check and re-enter information. But unfortunately, that’s a labor-intensive and time-consuming exercise. Eventually, inaccurate information will ultimately lead to making decisions that are not well-informed.
Vulnerable to Fraudulent Activities
There are many cases in which fraudulent manipulations in business Excel files resulted in million-dollar losses. Lack of security and controls is the underlying reason for this vulnerability, making it easy to alter values, formulas, and dependencies without any trouble.
Difficult to Test or Troubleshoot
It’s common to have corresponding data scattered across spreadsheets at different workstations or geographical locations. However, it’s challenging to troubleshoot or test Excel worksheets.
Even if we could identify every related file, it would take a lot of time to check formulas from one cell to another. The same problems occur when we troubleshoot any questionable data.
Limitation on Visual Representations
Although the software provides many types of charts, it still has numerous limitations.
- Diagrams are not interactive. We can use filters only to a limited extent.
- The software can’t link diagrams to one another. Instead, it handles each diagram in the file separately when setting a filter.
- There is a limited range of visualization options and diagram types.
Unsuitable for Agile Business Practices
Individuals with little IT expertise can create spreadsheets. Over time, these spreadsheet files become personalized user-developed applications. If another individual takes over these spreadsheets, he may want to start building the same spreadsheets from scratch.
It does not Offer Collaboration Opportunities
Generally, accurate pricing depends on information collected from different individuals and departments. The final document is the outcome of multiple files, ideas, and data exchanges.
When a business has multiple offices scattered throughout a city or country, exchanging high-volume data in Excel files can be challenging through email.
This exchange is vulnerable to duplication. In some cases, it can also result in incorrect data input. Team members can’t keep track of similar files going back and forth. In some cases, they can end up sending an old version.
Although Excel is famous for its financial reporting and analysis, using the program means a slow consolidation process. You must collect data from various files, create a summary, and submit the report to the department heads through email. You may also copy to a shared network folder or use portable storage media. The process continues until the information reaches to company’s top officials.
Does not Support Decision-Making Process
When you work in a spreadsheet-based environment, you must extract data from different sources to consolidate and summarize the information. This meaningful information helps key decision-makers design the best course of action for the company.
However, everyone involved in the process must be vigilant in maintaining data integrity. In addition, the entire process takes a lot of time and does not help when company officials need to make immediate decisions. There is less time for action when the final version arrives in such a situation.
Steep Learning Curve
It’s not uncommon to find numerous books on how to use Excel because the program is not intuitive. It contains hundreds of features that beginners may not find easy to use. Users must do their homework before becoming a pro at Excel.
Data doesn’t Update in Real-time
When using Excel spreadsheets, remember that data won’t update in real-time. That means you have to make every change manually. You or your team members must update Excel spreadsheets at the end of the day or week. In some cases, it can be a monthly practice.
That means users will need some paper records whenever they are recording information in the absence of Excel spreadsheets. These records are then entered manually for updating the sheets later. Again, this duplication of effort wastes considerable time and increases the chances of entering incorrect data.
Undoubtedly, Microsoft Excel is an excellent tool for organizing and calculating data. However, the program has less value for big organizations or large-sized businesses. Therefore, choose this program only if you think the program will be able to handle your data and you won’t have trouble entering the information manually.