How to Quit Excel
I’ve been wondering for some time, on how to end my use of Excel in both business and personal settings. The addiction was brought to my attention while working with nimble start-ups and younger companies (and people) at those companies. Full disclosure, my exposure to start-ups is mostly West Coast software and B2B companies so maybe Excel is dominant in East Coast, NYC and Boston start-ups?
Most of these forward-thinking start-up technology companies don’t love Excel, while Gen X and older tend to lean almost exclusively on Excel. Also law firm, investment firms, and accounting firms still use Excel, and I think this is somehow legacy software, similar to how they used a Blackberry well into the Smartphone era.
Worse, I noticed Excel was driving my business habits, and there might be a shiny and better world beyond an Excel spreadsheet.
Excel tail wagging the dog
Laptop computer — I use a PC because the keyboard allowed for learned Excel shortcuts versus a Mac. Additionally, there is a myth that only a PC has the power to crunch large Excel spreadsheets.
OS platform — if I use Excel I might as well continue to use Microsoft Word, PowerPoint, and OneDrive — but aren’t these inferior to Google and Apple products? Do I need to use a PC to have the best experience with these products, or better yet, do I need to be locked into an OS platform to use those products well.
Updates & Online Versions— Excel does update its product just enough, for example with intuitive graphs and charts in their latest version, to keep me thinking things are working well and my addiction is acceptable. The online versions of Excel are tempting but seem to be difficult to share and collaborate with anyone else unless they have a Microsoft “Live?” account or OneDrive? Or both?
As I’ve been digging deeper into solutions that Excel provides and asking if Google Sheets is just as good product to use for financial analysis, simple math and modeling, and for instant take-aways of data analysis. The short answer is yes, but the more detailed answer is Excel does the scratchpad work of data analysis and probably covers the majority of tasks like quick pivot tables, insights, and math we need. Check out the AI in Google Sheets by clicking on the “Explore” icon in the lower right corner.
Excel might be heftier with larger data sets but probably we should be using SQL for these anyways. Excel might exist just because we keep it around.
But what about financial modeling?
With company forecasting and scenario modeling that drives many of my activities in M&A, there is a myth that Excel is the only way because classically financial analysts doing the modeling are sending around Excel files and only Excel can crunch or compute the required amounts of data. But there are areas of concern. Excel can be Fragile — how many times does your circular reference crash and the file become corrupt or too large to send? And maybe we need sturdy when making difficult and complex modeling decisions with data. From the Importance of Excel by James Kwak
But while Excel the program is reasonably robust, the spreadsheets that people create with Excel are incredibly fragile. There is no way to trace where your data come from, there’s no audit trail (so you can overtype numbers and not know it), and there’s no easy way to test spreadsheets, for starters. The biggest problem is that anyone can create Excel spreadsheets — badly. Because it’s so easy to use, the creation of even important spreadsheets is not restricted to people who understand programming and do it in a methodical, well-documented way.
How about just quitting Spreadsheet altogether?
This is a idea worth sitting down and thinking about. Most of the Excel modeling in my M&A context is really just getting to quick decisions or dumping large data sets and forecasting financial analysis. How much of this effort could be solved in collaborative, cloud software between parties to arrive at the correct starting point? I have been asking: i) do we need a model at all? ii) what decisions will this drive once even a draft is completed? iii) is model a check the box for a process and if so, why not use a template M&A spreadsheet iv) can we just debate the drivers of the model and the inputs and not create all the formulas and outputs?
To shake the addiction, I’m continuing to evaluate cloud platforms (@rvkline868 or @ryanklinefelter on TW), take our simple tasks to Google Sheets, debate if we need to even open Excel as part of financial modeling process, and then if we have to put hands on keyboard, let’s just use Excel smarter to align on basics of decision making. One day we might shake Excel altogether as we work more collaboratively and make quicker/smarter/automated data decisions.
