Excel is arguably the most powerful product in the Microsoft Office suite, and it’s not hard to see why. With over 1 billion users, it’s one of the most common softwares in the world, and from what we see here at LiveCosts, it’s the most used free construction accounting software….if that’s what you’d like to call it. This single program can be used for every aspect of the construction business, why consider anything else?
Niall Brennan from LiveCosts discusses the pro’s and con’s of using excel for construction and why it most certainly is not the best construction accounting software you can use.
Let’s take a look at the pro’s and con’s of using excel for construction
A great place to start
Microsoft Excel is relatively easy to use and readily available. Contractors who are new to the business or who work on relatively small projects can get by with the capabilities included with Excel. it first became available in the late 1980s. Because it’s used for so many different applications, it’s very versatile. It is a fantastic place to start when using a software in a business.
With over a billion users, excel has quite a community. From simple invoice template to extraordinarily complex business forecasting, with a google search or two you will find something that will be very close to meeting your requirements. With a few adjustments you can save a serious amount of time.
Remember those bygone days of having to manually add up a bunch of numbers in a records book? Well, Microsoft Excel ensures that such legacy methods of making data calculations will remain in the past where they belong. Indeed, Excel comes equipped with the ability to run a multitude of different formulas, all of which promise to automate calculations that would otherwise be a huge burden if done manually. Sure, the prospect of memorising a host of different formulas can seem intimidating at the beginning, but fortunately for Excel users, there are a plethora of guides that show how to get the most out of the formula system.
Organise your data, your way
Data is in and it’s here to stay. Data collection offers businesses enormous value! With the proper data, a business can determine what strategies work, how they are working and what the team needs to do to improve these results. Often times when interpreting data for business, you normally do not consider just one or two samples but rather hundreds if not thousands of morsels of data.
Here’s where Excel can help you. Excel is the perfect tool to organise and interpret data! Specifically, by using the Pivot Table feature, a user can break down thousands of lines of data into an easy to understand graph. This is very useful because the quicker you can understand data, the quicker you can make decisions to further progress your business.
The Notorious Human Factor
Rubbish in, Rubbish out. It is only as good as the person that inputs the data. With no method of error recognition it is totally reliant on the human’s ability not to make errors, I haven’t met one yet? For example, during the calculations of project work costs, only one slip of the formula to some cells can really spoil the result.
Lack of collaboration
Excel is not designed for sharing amongst users. When you’re working on budgets or forecasts or other group tasks that require the use of Excel, typically you will need info from different people in various departments. Many times the only way to get this info is to send files back and forth via e-mail. The process of consolidating data from these different files is very slow. This is inefficient business practice and also opens up tremendous room for errors.
Security and Viruses
With a huge reliance on these files for business and financial data we need to think about the possibility of losing the file. If it attracts a virus ( viruses can be attached to an Excel file through macros which are mini-programs that are written into an Excel spreadsheet ) do we have a back-up. Also without writing code they are un-protected and are available for all to see.
Excel might be the most dangerous software on the planet
While researching this topic I read an article in Forbes magazine that i found very interesting given our reliance on this software Read Forbes Article Here.
Basically it described that spreadsheets have given us an ability to grow as businesses and economies even, over the last 30 years. But with that level of dependence comes great responsibilities, “There’s a danger at one level, it’s all become so complex and it’s handled in such a slapdash manner that no one is really on top of it anymore”. Sounds familiar, you start a new spreadsheet to track what invoices have been payed, then it grows in to this monster, that with one extra zero can ruin a month, year or business, that’s dangerous!