If you're creating and managing budgets in Excel today, you're not alone. If you're struggling to make Excel an efficient tool, you're not alone either.
We know that Excel is a powerful personal productivity tool, but it lacks the necessary features to develop accurate and comprehensive budgets required for modern business management and also demanded by executive management and boards of directors.
But how do you know if your company really needs to change the way it manages its budget?
Here are 5 signs that will help you realize that budget control in Excel is no longer efficient for your business:
1.) The budgeting process takes a long time.
Creating a budget in Excel often requires several manual steps, usually starting with accessing and downloading financial results from the company's accounting system, then including the data in various Excel files, creating revenue and expense projections, updating forecasts and formulas, and creating reports comparing actual versus budgeted information. It's a manual and very time-consuming process.
Last-minute changes to Excel files are difficult to manage, and it's easy to forget to update links or formulas.
2.) It is difficult to consolidate data.
Budgeting often requires consolidating data from across the organization. The ability to access diverse data sources in real time is essential for building an efficient budget; however, the time required to consolidate this data is significant, and furthermore, a considerable discrepancy can occur between the collected information and the current data.
3.) There are many versions of files.
Budget templates in Excel are prepared manually, shared, and collected, which leads to version control problems. Given the need for multiple budget versions, it becomes difficult to identify the latest changes to a document; without version control, errors can occur, potentially even causing audit problems.
4.) Limited collaboration
When all stages of the budgeting process are not clearly defined, finance teams often struggle to gain the collaboration and participation of all departments necessary for the construction and validation of the budget.
However, during the collaboration process, it is necessary to share spreadsheets between participants, which makes it easier for those involved to unintentionally alter formulas, links, and even delete rows and cells. In short, this collaboration process greatly hinders the visibility of changes, leads to inefficiency, and even errors.
Another very important point is the absence of a traceable process; that is, with the budget created in Excel spreadsheets, it's not possible to see all the changes and who was responsible for them, which makes investigating errors difficult. Therefore, finance teams end up spending a significant portion of their time simply verifying that the numbers are up-to-date and accurate.
5.) Information is accidentally shared with other people.
Did you just send the Excel file with the salary information? Budgets contain confidential company information, such as detailed expenses for different departments and even salaries.
When you're using multiple spreadsheets in Excel, it's easier to accidentally send the wrong file to the wrong people or authorize access to the wrong shared drives.
After seeing all the signs that Excel spreadsheets are no longer efficient for your business, discover how using an ERP system can help you make this process simpler, faster, and more efficient.
By using Oracle NetSuite ERP, it's possible to automate planning and budgeting processes by centralizing all of a company's financial and operational data. This allows finance teams to quickly and easily produce budgets and forecasts, and even model scenarios and generate reports within the ERP itself in a scalable and collaborative way.
Through Oracle NetSuite, finance teams are able to gain the control, collaboration, and visibility necessary to develop the financial and operational plans of their organizations.
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