Moving Beyond Excel for BI

How finance leaders can embrace business

intelligence software without leaving Excel
completely behind

A White Paper prepared by arcplan www.arcplan.com

Introduction

Analysts and financial planners love their spreadsheets. And why not? They make it easy to tweak
reports, employ formulas, and massage your data. In fact, spreadsheets are the most often used
technology in 60% of organizations surveyed by Ventana Research in August 20111. They have become
an indispensable tool for calculations, modeling, analysis, and planning.

But Excel is not necessarily the best choice for every scenario. If you think you have outgrown your
spreadsheet model or you are encountering more and more situations where Excel is failing to meet your
needs, then it is time to think about the next step – business intelligence software.

Business Intelligence (BI) that embraces Excel users is possible. If you are considering making the move
to BI software and want to know the pros and cons, this white paper was written for you. It is designed to
help you move your organization from a reporting and budgeting process that is at least 10 years behind
to one that eliminates the chaos and errors of a totally spreadsheet-based BI framework. You will see that
it is possible and well worth the effort to move beyond spreadsheets for BI without totally abandoning their
best aspects and that an Excel add-in can act as a bridge between your BI system and your
spreadsheets, maintaining the data security and integrity desired by both the finance team and IT.

The Eternal Struggle

For many people, Excel is BI. Is it this way at your organization? Mid-sized companies have relied on
spreadsheets for reporting and manual budgeting and forecasting processes for a couple decades, and
spreadsheets remain the de facto standard for day-to-day analysis.

There are so many tug-of-war stories when it comes to spreadsheets and BI software. Whether it is IT
wanting to implement BI and the analysts wanting Excel as their primary tool, or the finance team
clamoring for a budgeting and planning system to centralize the process and IT showing reluctance since
it might be costly and time-consuming, someone is always struggling to move beyond Excel.

In the end, what everyone wants and needs is better reports.

1
A Call to Action for Business Analysts. Mark Smith, Ventana Research. August 2011.

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The Excel Love/Hate Relationship

It is natural to have a love/hate relationship with a software program that puts the power in your hands at
the same time that it creates chaos. But there are many reasons why Excel is the most used analytic
technology:

It’s easy. Spreadsheets do not intimidate people. There is very little training required to use a
spreadsheet competently and most people can tweak a report, sort, filter, or remove a column without any
help at all.

It’s cheap & ubiquitous. Excel costs nearly nothing and practically everyone has it (or access to
spreadsheets in some form, like Google Docs). Surely SMBs like the low cost – a well-crafted
spreadsheet may be all the technology a company needs to get up and running quickly since it allows
users to do some fairly complex budgeting, planning, and analysis.

It’s familiar. Change is difficult. For many people, falling back on Excel, which they have used for years,
is simply easier than learning a new system.

It’s great for local, ad-hoc analysis. A CFO Research Services survey indicates that nearly 70 percent
of analytical application users continue to use spreadsheets for local, ad-hoc analyses of data from other
applications. So even if they have BI deployed, sometimes ad-hoc in Excel is what users prefer.

It features an extensive formula & function library. Excel’s extensive list of formulas and functions like
max, average, countif, and sumif allow users to build fairly sophisticated reports and even use Excel as a
budgeting and planning tool.

However, there are just as many reasons to hate Excel:

It can overcomplicate things. Sometimes Excel seems like a Rube Goldberg machine – something
comically over-engineered to perform a simple task in a very complex fashion, like the famous “self-
operating napkin” that involves a chain reaction of a spoon, a cracker, a parrot, a pail, a clock, and a
rocket. Does your organization have an overly complicated, multi-workbook Excel file that you are using
to manage budgeting, planning, and forecasting? Have you seen spreadmarts where one wrong
keystroke destroys the whole bottom line?

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It doesn’t provide enough analysis. The same analysts and executives who rely on Excel for views of
performance say their current data analysis environment is not good enough2. The data collection and
consolidation required when using spreadsheets steals from the amount of time users can spend
analyzing that data to find root causes or make decisions about how to correct underperformance.

It lacks powerful visualization. Power users might always prefer Excel, but front-line workers and
executives prefer easier-to-use tools and visually-appealing dashboards that give them at-a-glance views
of performance and drill-down capabilities. Excel will never provide this level of flexibility.

It forces you to do time-consuming, manual work. Working with spreadsheets can be cumbersome
and in the end, can result in obsolete information. Users spend so much time compiling data and
massaging it – especially when it comes to budgeting and planning – that by the end, your data is out of
date or something has changed to make it no longer useful. And that can undermine your credibility,
which is an even bigger problem.

Spreadsheets can be fraught with errors. This is a huge problem when you need accurate information
to make critical decisions.

Spreadmarts! Some people might think of spreadmarts positively, but the connotation these days is
mostly negative. Years ago, spreadmarts were known as impressive reporting or planning applications
built from humble Excel workbooks that are linked with formulas and macros. But today, spreadmart is a
short way of saying “spreadsheets have run amok at my company.” Everyone is using different data
sources and different rules for defining metrics, which fractures the view of performance and can lead to
bad decisions based off of faulty data.

It lacks important controls. Excel offers no security, data integrity, or audit trails, which is why IT
carriers a grudge against spreadsheets. When there are no controls in place, multiple versions of the truth
pop up.

So as you can see, there are just as many reasons to hate Excel as there are to love it. But Excel really
isn’t going anywhere so your BI has to embrace it.

2
A Call to Action for Business Analysts. Mark Smith, Ventana Research. August 2011.

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Have You Outgrown Spreadsheets?

Even if you love Excel, there are moments when you need to face the music and acknowledge that you
have outgrown your old spreadsheet-based reporting or planning process. So how do you know if that is
the case?

 Do you miss reporting deadlines because of old or broken data?

Obviously missing deadlines is unacceptable and if it’s because of your Excel Hell, then it’s time
explore an alternative.

 Do more than 6 people use your spreadsheets more than 6 times?

This is a great rule of thumb to help you avoid the spreadmart situation where everyone has their
own version of a report.

 Are your reports bigger than 1 screen?

If so, they are too complicated for Excel.

 Can you re-plan or re-forecast to reflect changes throughout the year?

If you can’t do this but have a need to, you have to start thinking about upgrading to BI software.
Anticipating change is what makes companies more competitive. If you find that your organization
is not going to make its sales target and you need to reforecast mid-way through the year, rolling
updated budgets down to budget managers with spreadsheets can take weeks – if not longer –
making the process pointless by the time it’s finished.

 Do you have time to analyze your data?

If you are spending all of your time doing purely mechanical data collection or compilation,
graduating from spreadsheets means more time for you to actually do your job and provide
strategic insights, increasing your value to the company.

BI Software Benefits

There are so many ways that BI software augments your current reporting and analysis efforts that we
can only cover a sample in this section. Whether you’re in finance, data analysis, or IT, BI software is
worth the effort and expense because of the many benefits it provides, especially as compared to the
human error, version control issues, and the massive amount of manual effort required when Excel is
your primary analytic tool.

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Here are some specific ways BI software can augment your existing analysis efforts:

 Automate repetitive tasks

 Allow report distribution on a scheduled basis
 Retain a familiar spreadsheet interface
 Eliminate manual data gathering
 Enable write-back to the data source
 Enable data entry (even unstructured data like comments)
 Enable complex scenario analysis, like what-if, best-case, and worst-case
 Mobilize your workforce with mobile BI
 Export reports to PDF, PPT, or Excel for distribution or further analysis
 Reduce human error
 Ensure version control
 Ensure data security

The benefits for all stakeholders are numerous. Analysts get better control over data and easier ways to
manipulate it and share results. The finance team gets the accurate data necessary for critical decision-
making. And IT gets the improved data integrity and auditing they want while ensuring that they facilitate
access to data for all relevant users – with the proper permissions, of course.

Embracing Your Excel Users

So many people who have BI software already do not know that they have access
to an Excel add-in to perform analysis in Excel on data that is directly from the BI
system. arcplan’s is called Excel Analytics and it enables you to take your BI
content and functionality and use it right in Excel, with a live connection to the
database for write-back and – this makes IT happy – with the full security and
permissions that have been set up in the BI system. Most of your pain can be
solved simply by using an Excel add-in! You still get the benefits of web-based BI but with a familiar
spreadsheet environment. It might just be the best of both worlds.

With arcplan Excel Analytics, users get the ability to:

 Seamlessly integrate BI application content and functionality in Excel

 Export applications, queries, and objects directly to Excel
 Create centralized and secure Excel applications while conforming to IT governance and
standards

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  Work in Excel but maintain connectivity to your BI application and source data
 Perform offline analysis against BI application content
 Access all major databases and BI systems via Excel
 Perform ad-hoc analysis based on BI application content in Excel

Case Study

One of arcplan’s major worldwide finance and insurance customers came to us with a problem: every
month they were collecting Excel workbooks from nearly 150 cost centers manually via email from
analysts all over the world. A dozen analysts in the US were staying late into the night to compile the
data, validate it, and get it into Oracle Essbase manually. Since the company is very large and this
process involved analysts all over world in various time zones, there was never a month when the
process worked as it was intended. They had to go back to the analysts every time they had an issue and
recompile the data, which meant more nights spent on the job and more time wasted.

So what did we do? We automated their existing analytical process using arcplan technology – allowing
them to move their worldwide data collection into a web-based BI application. This allowed the analysts to
enter and reconcile data and get feedback in real time as to whether they were off/on/close/not close.
Submitting the data with one click meant removing many of the manual steps previously required.

This allowed our customer’s employees to do their job – be analysts – and not spend the majority of their
time creating and managing data. People who are freed of this burden by BI software often say “I don’t do
– I just review!” And that is what these analysts are doing now.

We worked with this customer more than 3 years ago to fix this process and they are still using their
arcplan application today. This customer recouped their financial investment (and more) in less than 18
months.

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Automating Your Structured Reporting

Your finance team likely needs to automate its structured reporting like our insurance customer. Financial
reports and statements are time-consuming to put together and need to be done on a regular basis.
Examples include:

 Income statements
 Balance sheet analysis
 Financial ratios
 Earnings analysis (EBIDTA)

Accurate financial reports not only to help everyone make better decisions, but they are often required by
government, your shareholders, or your auditors.

Think about your cash flow analysis and balance sheets – these reports aren’t going anywhere and you
probably prefer creating them in Excel. But what if those monthly/quarterly/yearly statements were
automated in an online spreadsheet interface – on your schedule – and all you had to do was analyze the
numbers rather than collecting and consolidating them? BI software can free your analysts from the
burden of keeping these kinds of standard reports up to date. Let’s see how.

BI software like arcplan can be

tailored to meet any need at your
organization. In the case of the
financial reports here, our client
wanted the ability to lock
particular columns, so that
functionality was included on the
Prior Year and Current Year
columns. Cells with data entered
by the user are colored red so it
is easy to spot the new
information. The yellow and
blue cross-check symbol (!)
you see in certain cells tells the
user that something is wrong
with the data and provides more details on the discrepancy when the user hovers over it. Users can either
reconcile the data or provide a comment about why the difference exists.

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Users of this system can also
import data from the current and
previous year in order to forecast
for next year. They can then enter
and change data in each cell and
write the results back to the source
system by hitting the “Save” button.
Comments and transaction history
(saved changes) are also
accessible via the red and green
icons on the far right.

The Income Statement is

automated within arcplan and
includes current data, previous
years' data, variances, and growth.
Users can switch between values
and charts in order to get a visual
representation of the data.
Changing the filters on
the right-hand side updates the
data in real time.

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The Balance Sheet has similar
features (values vs. charts). It is
also laid out in a “butterfly" design,
with accounts in the middle,
variances between actual and
budgeted values on the left, and
actual vs. last year dollar amounts
and growth percentages on the
right. If the user switches the
filters on the right or drills down
into the hierarchies of data, the
requested information is pulled
directly from the source system
and presented in real time – a
task that could not be replicated
in Excel.

Financial Ratios are difficult for

most BI systems to calculate and
present, but arcplan is able to do
this with ease. Clicking on
individual bars on the charts at the
bottom of the screen reveals the
ratio values. Clicking on any value
(data point) on the radar/spider
charts adjusts the charts at the
bottom of the screen to match the
clicked information, allowing for
on-the-fly analysis.

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Finally, the Earnings Analysis
(EBIDTA) report shows the
transformation of income from last
year to this year and the main
categories of change. There are
multiple ways to view the data –
as an income bridge, as values, or
as values with charts.

This is an example of just one type of arcplan application that incorporates a familiar Excel look and feel
with visual analysis, write-back capability, and real-time data updates. Robust ad-hoc analysis is also
available with every arcplan installation, so power users can perform on-the-fly business queries within
the BI system or within Excel via the arcplan Excel Analytics add-in. All arcplan reports are exportable to
Excel, PowerPoint, or PDF for
additional analysis and sharing
with colleagues.

The particular application shown

above, called the Executive
Briefing Book, can be deployed at
most organizations in just a few
weeks. Since arcplan natively
connects to more than 20 data
sources, implementation is simple
and quick.

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Conclusion

When Excel is embraced as part of a BI tool set with a BI add-in like arcplan Excel Analytics, Excel users
are happy because they still get to use spreadsheets, but the right way, with IT’s buy-in, and with the data
access they need. In essence, moving beyond Excel and into BI software that is made for Excel and non-
Excel users means:

 Getting rid of linked workbooks and “spreadmart hell”

 Users get to spend time analyzing rather than on manual data collection
 Reports are created from trustworthy sources and remain connected to the data source
 Data that is changed can be written back to the database and aggregated instantly for reporting,
analysis, and what-if scenarios
 Data, regardless of its source is accessible by those who need it when they need it
 IT breathes easier with users accessing data that is secure and trustworthy

Ultimately, Excel is going to be around for much longer, but it’s just another tool in the BI universe. You
can implement BI software and get one version of the truth while still allowing that Excel has its place. It
can be as simple as allowing power users to use Excel via an add-in and keeping BI dashboards for
executives. Excel use is controllable when you have a BI system in place – especially one like arcplan,
where you can have reports up and running in 2-6 weeks and for an affordable investment.

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 About arcplan

arcplan is a leader in innovative Business Intelligence, Dashboard, Corporate Performance and Planning
software solutions for desktop and mobile use. Since 1993, arcplan has enabled more than 3,000
customers worldwide to leverage their existing infrastructure for better decision making. Empowering
all users to connect and collaborate with relevant information is crucial for improving business
performance. With arcplan – it simply works. Get more information and download our free trial at
www.arcplan.com.

arcplan’s flagship product arcplan Enterprise® was rated the #1 3rd party tool Try arcplan free for 30 days at
for SAP BW, Oracle Essbase, and IBM Cognos TM1 in The BI Survey 10 www.arcplan.com/fte
(2011).

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© 2012 arcplan. All rights reserved. arcplan, arcplan Enterprise, arcplan Excel Analytics, arcplan Engage, arcplan Edge, arcplan Mobile,
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arcplan
The information published herein is subject to change | White Paper
without | Moving
notice. Beyond Excel
This publication for BI
is for informational purposes only, without representation
or warranty of any kind, and arcplan shall not be liable for errors or omissions with respect to this publication. www.arcplan.com
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