Companies that currently use spreadsheets for TIME AND MATERIAL PROJECTS and/or for other
"BUSINESS CRITICAL" projects should read this article
Are you putting your Company and Clients at Risk by using Spreadsheets to bill your Projects? If so, why?
Does this sound familiar?
**We were convinced when we ran a parallel with our in house spreadsheet against your Time and Material program. We found enough errors that would have paid for the program over and over. The reality of this is the parallel was done against one bill and that was enough for us to make the switch company wide. We can only guess at the actual money that we have left on the table not to mention the thousands of non billable man hours we spent trying to review and locate bad/corrupt formulas**
Risky Business? Read the items below and you decide:
The Statistics as reported by many experts and others are consistent in reporting spreadsheet errors. They all report percentages of spreadsheets that have errors related to formulas that are as high as 90% or greater and this excludes data input errors. This alone is "Risky Business" for any company. The truth is there are many more factors that add to the overall risk of the use of spreadsheets. They seem to all agree that the most experienced spreadsheet users that audit and review spreadsheets have difficulties of finding these errors and require special tools and many non billable hours. Still only a small percent the errors are identified in the extensive and expensive process. This should be an eye-opener to ANYONE that is reading this and especially if they use speadsheets as a critical tool in their business. Another factor is the fact that most companies have only a couple of employee's that are somewhat experieced at understanding the basics of simple formulas and most do not understand complex formulas or how to run formula analysis. Then most company's are allowing anyone to use a spreadsheet with little or no knowledge of how they really work to process data related to business and clients.
Many users will always look for shortcuts such as but not limited to "Copy and Paste", "Duplicating Sheets", "Hiding Sheets", "Changing the Default Look up Items Data" and many more. All of these create the chain reaction of corrupt spreadsheets and then these are emailed to other users to use for other projects, etc... This alone cost companies time and money.
We have found that most companies leave the spreadsheet responsibility to one person in their organization and are unaware of the real risk. Until they read this article and then realize that this article is speaking to them with the same issues they find in their own use of a spreadsheet as a business critical tool. The person or persons in charge of the spreadsheets really believe they can fix all the errors but the reality is they may fix some but in most cases cause even more issues. By the time the errors which seem to be a daily event are found the spreadsheets have gone viral in their company and to recall them all in most cases fails and the corruption continues as these are continually used and emailed throughout the company.
Due to the known risk of spreadsheets many third party auditors will completely create another spreadsheet one cell at a time to audit. This method is when the errors are found and the process begins (you are now spending additional labor hours that are non-billable to correct the errors). Then like most you start thinking how many of your users are using this same spreadsheet and how many projects have you billed now knowing that these errors exist?
Convenient and Risky:
Many users state that spreadsheets are convenient and easy to use? Is this a good enough reason to put your company at risk? Spreadsheets are extremely risky and offer no real controls and vulnerable to human error that may be hard to find until it is too late putting you at risk with your payment and your clients.
Flexible to the user:
True, but when you have the ability to change process at any given time this creates the risk of not being consistent. Not to discount the fact that this makes the review and audit process very hard when you are having to clean and scrub just to print a report. Do you really want the ability to change your billing process to match the limits of a spreadsheet?
Spreadsheet Cost / Low cost to Freeware:
Are you really saving money based on the cost of the program? The fact is you may have a low cost spreadsheet program but what you should be looking at is the associated risk and operational cost of using this for your clients bill that you had to manipulate with no real protection. We estimate that your operation cost alone is making this one your most expensive programs on a users computer in the long run.
Are your spreadsheets really protected even though you protected them with passwords?
WARNING: All a user has to do is search How to unprotect a protected spreadsheet and with the click of the mouse they have many choices of Freeware that they can use to unlock any spreadsheet. These programs make this an easy task and can unlock a spreadsheet regardless of how complex the password is and this is done in seconds with the click of the mouse. Is that the protection you want on a tool that is responsible for producing a bill for your company and clients?
Audit / Finding Mistakes:
This is one of the most difficult and time consuming task. Finding an error is sometimes impossible and in most cases these are found by a third party analysis and audit, the wrong time to find mistakes that should have never happened. Now your payment is at risk and most important it is DELAYED. Nearly 100% of these are due to corrupt formulas that are hidden, and finding these requires that you click on the actual cell to display the formula. This takes someone with some experience dealing with formulas. Costing you the time for extensive non billable labor and applied to direct operational cost.
Bill Analysis Now and Later:
Most companies that use spreadsheets are guilty of having many different versions that are related to clients, projects, price data and more. The spreadsheets are full of data including all the formulas and input data and then they email these or copy the file from disk to disk. In time, these spreadsheets go thru so much manipulation that it is nearly impossible to analyze the risk of corrupt formulas, missing data and links between pages and hidden list. Every company should analyze all the risk associated with using something that lacks the controls and requires human created formulas to calculate each and every input with no real protection.
The most common overlooked item is data security. All it takes for you to loose data is either a spacebar, delete key or the user fails to save their work. Again, you can protect (not really) your data but what you cannot do is get away from the extensive labor and the fact that every input is fully dependent on a formula that is created by a user and can be deleted/changed/corrupt without anyone ever knowing until it is too late. The actual saved file can be so large that it limits the ability to email or save to flash drives. This is an item that cost you time and the ability to get your bill out to the client.
Reports / Billing
Companies that use spreadsheets with any type of features such as but not limited to Pivot Tables and other created rules are not realizing just how complex it is to create reports and just how labor intensive this process can be. This process cost you time, money and delayed billing. With a complex spreadsheet the process of printing a bill is very time consuming. These types of configurations limit the process of who can generate a report due to the complexity of the spreadsheet. The process just to create a simple report puts the entire bill at risk. We hear it too often that when a report is requested it takes a lot of time just to hide, scrub and then print the bill then after all this you have to go back unhide, etc.. just to continue working on the file.
Consistent Errors with Formulas makes you really start focusing on any bill that you receive from a spreadsheet. We have heard this more than once form forensic auditors. "Companies are using a tool to bill their services and the use of this tool is very questionable. We consistently find calculation errors and report these and then we get another bill from the same source and it is not uncommon to see some errors fixed but then new erros exisit. This should be very alarming to any company and why is it the CFO of these companies allow them to use a tool that is so vulnarable is beyond me. I will say that is a great source of revenue for us."
Why would you put your company at risk and not to mention the relationship with your clients?
The real answer to this question is your lack of knowledge and putting your trust into one or more of your employees that many not understand the real risk associated with the use of a spreadsheet. Now take this and think about your current users and the fact that every risk listed above can happen to the most experience spreadsheet user. This includes but not limited to, the ones that are skilled enough to create complex formulas, pivot tables and vb coding.
Risky business? We see this too often with companies that use spreadsheets as their main billing tool. We can help you eliminate these types of risk by using a program that offers you the controls needed to manage your billing and process with real controls that deliver accurate and consistent results.
It is time to rethink your spreadsheet strategy
Think about this do you have the time to round up every spreadsheet in your company? The truth is this would be a recurring event due to the enormous responsibility to maintain compete control and consistency of each spreadsheet. The answer is NO you do not have the time so the real solution is to go to a dedicated software solution that eliminates the FORMULA requirement since this is one of the main causes of corrupt spreadsheets. The advantage of a software solution is the fact they support the software so you are not dependent on anyone in your company and that alone should be enough to say - Enough is Enough...
Want to learn how you can eliminate every risk related to spreadsheets and have the security of having full support even if the person you thought was your spreadsheet expert leaves your company? No more formulas, reports at the click of the mouse and more? We understand the risk of spreadsheets, our president used them in his early years in the property loss industry and he will be the first to tell you that they cost his company a lot of lost revenue over a period of time. The lost revenues were related to corrupt/missing formulas, lost data, human errors, and the cost of labor that were direct operational cost that were non billable to any clients. Bottom line spreadsheets are probably the most expensive program on your users computer. The amount of time easily pays for our programs and the best part is we support it and give you access to our T & M experts and billing assistance.
ARE THE RISKS REALLY WORTH IT?
If not, contact us today, and let us show you how we can help you eliminate the spreadsheet risk and get your clients billed accurately, consistently and fully transparent aligned to your agreements.
"**Spreadsheets are great for many business applications but you must understand there are limitations, lack of structure and controls and these are serious so understand before you use these for your business critical tools. In most cases you find that only a handful in your company can help with a spreadsheet if something goes wrong"
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