Despite Usefulness Excel, Access Share Limitations (Opinion)

It seems to be the season for software projects for many companies.

Companies are growing. Their software, or lack of software, is becoming a problem. They can’t effectively keep up with the number of business transactions being generated.

This problem usually manifests itself in the areas of order processing, production planning, inventory management, and accounts receivables.

What do most people use in this area when they don’t have solid operational software?

Unfortunately, many companies’ production planning and inventory tracking efforts take place on Excel spreadsheets. Or, even worse, Microsoft Access custom-built databases are used to capture business information, perform planning and publish reports.

While these tools are very useful as a business starts up, there comes a point in the life of a business when several issues come into play if these tools are used extensively in business processes and reporting.

Both Excel and Access are “personal” tools. Talented people are able to take these tools and create useful spreadsheets and databases. While spreadsheets are fairly easy to understand and share across an organization, Access databases tend to be owned by one or more Access wizards.

The major problem with Access databases being key components of business processes is that when the Access wizard who created the database and related business process leaves the organization, the usefulness of whatever they created in Access is lost. The business is then forced to re-create whatever was being done in Access, as even the addition of a new Access wizard doesn’t guarantee the old creation will continue to be used.

While Excel spreadsheets tend to survive the departure of the creator much better than Access databases, they tend to have their own issues.

Data accuracy is always in question with Excel. There are typically multiple points of keypunch of the same or similar data. Keeping the data accurate involves time and review steps that add little value.

Excel sheets, at best, are only periodically updated and distributed across the organization. The result is that business processes based on Excel tend to have to be spread out over a period of time versus being “real time.”

Businesses tend to greatly underestimate their investment in Excel spreadsheets. As the business grows, the number of spreadsheets grows even faster. The number of people required to maintain and update those spreadsheets is sometimes surprising. Management often feels it is flying blind in monitoring the business, as the number of possible spreadsheets to review each week can be overwhelming.

In most cases small and mid-sized business owners have the opinion they are being economical when taking an Excel- or Access-based approach to many of their business processes. They are willing to accept the drawbacks in exchange for what they feel is better cash flow.

That is, until the point is reached when business management comes to the realization they have lost command of their business information. The number of Excel sheets and paper reports simply becomes too overwhelming to monitor.

Accountants, business analysts and everyone involved in tracking the business become frustrated.

Interestingly enough, the most common complaint I hear in these situations is that management struggles to accurately forecast cash flow.

Time, it seems, is connected to money. At some point taking the economical approach begins to cost the business real time and money.

As the business begins to think about an improved software system as the answer to these issues, the tendency is to think in terms of a new “accounting system.”

The reality is the business should be focusing on software that will deal with optimizing business operations, transactions and timely management reporting, with the goal being to eliminate the need for Excel spreadsheets’ and Access databases’ roles in key business processes.

Steven Hankins is CEO and co-founder of Accio.US, a technology company providing advisory and management services for small- to medium-sized businesses. He can be reached at [email protected].