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July 2017

The Dangers of Excel

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The Dangers of Excel

Excel may seem harmless enough as a system for managing your company’s data, but it can actually be downright dangerous. In fact, it might be the most dangerous software on the planet. Sound like an exaggeration? Often a small spreadsheet error might not be life threatening, but small errors can lead to bigger, systematic problems when spreadsheets are used for data management processes that they were never really meant for in the first place. Here are some of the more serious outcomes resulting from overuse of Excel.

Financial Errors

We’ve already written about how Excel is costing businesses billions each year through lost productivity, duplicated data entry and manual input. Tiny mistakes in spreadsheet formulae can lead to serious mistakes when calculating large numbers. Take the example of J P Morgan who’s Excel error lead to wild miscalculations of their value.

While the money being calculated and collected is ‘electronic’, if banks go bust as a result people could lose their real life savings. It can also lead to customers losing faith in your business if a major mistake, like losing track of their money or misallocating large amounts of stock, happens as a result of spreadsheets being used to process lots of information.

Security Errors

Excel Spreadsheets are also a security risk. They can be hacked in order to gain access to the data therein, putting your customers, users, members of staff and anyone who interacts with your company at risk. So if a major security breach occurs then that will be difficult for a business to come back from.

Spreadsheets are also often used to carry and spread viruses, malware that can spread and corrupt all your files. Because spreadsheets often have to be shared amongst multiple people, this opens up the possibility of a security hazard, especially if spreadsheets are sent via emails that are not encrypted.

Common Mistakes

The scenarios outlined above are the worst outcomes of spreadsheet mistakes for companies. But what are the most common errors that lead to mistakes like this?

  • Hiding cells instead of deleting them. When you hide a cell it appears blank but the value in the cell is still there and will be taken into account by the spreadsheet’s algorithms.
  • Cut and paste errors. You cut and paste from one spreadsheet to another but it doesn’t quite line up. Maybe some numbers are put in the wrong column, leading to totally different results than what you wanted.
  • Logic/formula errors. You use ‘mean’ when you meant ‘median’, or multiplied when you should have added. Doing anything more complicated than basic arithmetic on Excel requires some training and can be a minefield.

The Solution

There are multiple solutions to these problems. For example, tagging data in order to ensure that you don’t add a value that will be wildly incorrect, for example put a decimal point where there shouldn’t be one.

Or you can use logic flowcharts to ensure that you’re using the algorithms you need to get the results you want.

Or you can bulk up your spreadsheet’s security with added safeguards such as passwords and user-specific access requirements.

All of these to some extent can be done on Excel, but not very well and they often aren’t done because people don’t know how. By comparison, the security controls, syntax and data entry requirements of a database tend to be a lot more robust, but at the same time flexible and user friendly.

To get ahead of these common problems, and make sure that your data management doesn’t result in a catastrophe that could kill off your business, consider using a database rather than a spreadsheet.

Wirebox have experience designing and delivering custom databases, as well as updating your existing data systems and managing the transition from spreadsheet to database. Our team have a wealth of experience to draw on, just contact us, we are happy to discuss your needs.

By admin July 2017

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