One of the great achievements of every good investment banking analyst programme is to turn even the most non-technical liberal arts graduate into an Excel expert. There are few problems in banking that can’t be alleviated with yet another spreadsheet and working with a myriad of different Excel files was always a normal part of our jobs in DCM and Syndicate.
In fact, even now our team keeps making fun of us ex-bankers for using Excel as our preferred tool for everything from wireframing to writing software specs!
Despite all its strengths, Excel does have some material shortcomings and the pain we had as end users - and often creators - of those spreadsheets was one of the key drivers for founding Bots in the first place.
The unexpected realisation along the way was that this user-driven desire for change is one of the rare cases where the interests of corporate policy and staff align perfectly.
There’s an entire movement, emanating from CFO, Risk and Compliance offices, focused on mitigating the risks from so-called end user computing. And clearly banks are more sensitive to this than most companies.
It’s easy to see why. With flexibility comes lack of standardisation and quality control. According to various studies about 50% of spreadsheet models used in large businesses have material defects and up to 90% of spreadsheets in business use contain errors.
Even disregarding outright errors, there are numerous anecdotes of teams relying on ancient spreadsheets created by long-departed colleagues that nobody fully understands anymore.
It’s far quicker to set up a spreadsheet than it is to build software and this isn’t just because of the coding process. Consider things like
· lack of version & change control;
· lack of documentation and reliance on the individual end-user who developed it;
· lack of security;
· lack of audit trail.
There are also some inherent shortfalls in the technology, such as accessibility and usability from different devices.
But above all, Excel’s biggest downfall is simply that it doesn’t support database functionality. It’s great for immediate results, but it’s a terrible way to organise your workflow in a competitive environment where data is eating the world.
If you want to leverage data analytics and achieve more reliable and standardised results, it’s time to swap out those spreadsheets for a better solution. And you’ll find a perhaps unexpected ally in your Compliance and Risk departments when fighting for the budget.