I have been on a crusade to eliminate Microsoft Excel at our company for the past year and a half. Excel is a wonderful tool, don’t get me wrong. I have been using Excel for years and years, and that very loyal, noble spreadsheet has been my support through thick and thin. During my days as an accounting student, I programmed my financial statements and balanced them using Excel. As an investment banking intern, I learned to create advanced financial models with the same tool. In Alianza, the company where I worked previously and where I ran the accounting department, we also used spreadsheets to create our financial statements and their supporting documents.
Through all those times, Excel was dependable and a true friend. Eventually, however, we started having problems. If I look back and analyze it, the issue wasn’t Excel itself, and it still isn’t. It was the errors we kept finding: we either added an extra digit to the number by mistake or the spreadsheets weren’t all connected with one another, so they needed to be reconciled between each other. Once Alianza grew to a certain size, we quickly realized that we spent more time checking to make sure Excel was right than working with the information in the first place. So, when we started Celaque, the company I currently run, I knew our dependence on Excel had to go.
It wasn’t easy because the only way to wean ourselves off Excel was to implement an Enterprise Resource Planning (ERP) system. We chose NetSuite (please refer to NetSuite: How to Select the Best ERP for more on our selection process). Because we were starting the business, the new software implementation was too expensive. Finally, a year after we started Celaque, we budgeted for the new system and started the process. One of the main goals of the implementation was to bring all spreadsheets to zero or close to zero.
What We Eliminated and How
We looked at all the Excel sheets we used and started working with each department within the company. Accounting is the backbone of the system, so we focused the initial phase in this area. Accounting was also where we produced the most Excel spreadsheets.
Our first target were the financial statements and supporting schedules we generated every month. The sheer number of documents was staggering. In one year in Alianza, we produced and referenced over 300 spreadsheets. These are some of the types of spreadsheets we were using without the ERP:
Financial statements (monthly balance sheets, income statements, and cash flow statements)
Supporting schedules (fixed assets, accounts payable, accounts receivable, taxes payable, expenses, income)
Bank Reconciliations (monthly Excels for each of the bank accounts we held)
To get rid of all these spreadsheets we had to:
Program the system to capture the information needed to produce each of these schedules. Many were native to the system, and we didn’t have to do anything. For example, the system generates all the financial statements. Other dimensions required us to program, so we created fields and forms to record the necessary information. We wanted to make sure credit memos were approved, for instance, so we added a field where the person reviewing could check that that transaction had been approved.
Customize the reports: NetSuite already produces a wealth of reports. We created our own, however, using those as a base to adapt them to our circumstances more closely. We created financial reports, fiscal and supporting schedules, and reports that showed that all important transactions had been approved.
Modify and perfect: We initially programmed the bulk of the reports to eliminate as many spreadsheets as possible. With time, we had to refine a few because they either had errors or needed to include more information.
The only spreadsheet we couldn’t get rid of was the fixed asset schedule because we didn’t purchase that additional module on NetSuite. This document is the only one we still have.
We followed this same process for the other departments and eventually stopped using spreadsheets. Some of the documents that were previously handled in spreadsheets and that we now create through the ERP are:
Sales availability and prices
Excel templates used for invoicing
All our information is now in a single database, and the reports all derive from the same origin. As a result, we don’t need to reconcile between reports, and the information is available on demand, compared to monthly. I can’t emphasize enough how much my life and the team’s life has changed because of this crusade. We have saved hours of work and avoided mountains of errors.
The Last 5%
I cannot declare Mission Accomplished just yet, as we are still working with Excel in certain cases. There are reports that aggregate information into a single document, such as key performance indicators or metrics that come from a variety of sources. The version of NetSuite we have does not produce them, so while we are not done yet, most of the work is complete.
If you have any ideas on how I can remove this final 5%, I would be grateful to hear your suggestions. In the meantime, I will keep looking for new ways to completely automate our reporting.