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Still Using Excel to Manage Data? You Aren’t Alone

Last month, Velocity focused on green issues facing the electronics supply chain, and as a quick followup, I wanted to focus on a key topic raised in a report I recently came across.

As could be expected, the report — “Greening the Supply Chain: Best Business Practices and Future Trends” from The Initiative for Global Environmental Leadership (IGEL), Knowledge@Wharton, Xerox Foundation, and International Paper Co. — provides some examples of current best green practices. They mostly center on supplier selection and sourcing, with the more run-of-the-mill discussion focused on collaborating on innovation, creating transparency and enforcing compliance of green laws and standards.

Then I saw this:

    Many of the largest and best global corporations are still using spreadsheets to handle environmental data. To make their supply chains truly sustainable, companies need information systems that merge environmental and economic data, and make the results available to all stakeholders within and outside the company.

Companies are still using spreadsheets to handle environmental data? Really? What is this, 1990? I obviously thought, by now, in 2012, spreadsheets would have gone the way of the dinosaur or the Liverpool Pigeon (which is thought to have gone extinct in 2008), especially given the investments so many companies have made in IT and supply chain planning systems.

I sometimes forget that there are still huge gaps between supply chain goals and reality, despite all the talk about creating uniform IT systems that allow supply chain transparency, exception-management capabilities, and any other cross-functional informational sharing. The report points out that “many businesses are still only at the starting line when it comes to analyzing environmental metrics,” and spreadsheets are the common way to track such data.

To be sustainable, environmentally and economically, companies must integrate environmental information with existing financial data, the report notes. Once that information is connected via a more robust IT platform, senior executives can better weigh all the relevant data needed to make long-term decisions and assess potential risks and opportunities for innovation.

Integrated environment-financial information also allows supply chain managers to align decisions to green-related, fiscal goals, and have clearer direction on what data can be shared with supply chain partners, a critical element in making the whole chain more environment-friendly.

Robert Giegengack, a professor emeritus at the University of Pennsylvania's department of earth and environmental science, says something in the report that is both a reminder and a wake-up call for anyone working on green supply chain improvements:

    We are congratulating ourselves that we are becoming more sustainable but we are not. We are becoming less unsustainable. And we'll begin to approach the question of global sustainability when we carry this discussion back to the beginning of the supply chain, because in every case but two [water and oxygen], we are extracting natural resources at rates that far exceed the rate at which they are being replenished.

It seems logical that one of the most important places to start is by getting the data house in order. Without it, how will companies know where to go next?

11 comments on “Still Using Excel to Manage Data? You Aren’t Alone

  1. t.alex
    September 18, 2012

    Most of us are more or less familiar with excel or other similar spreadsheet software, and the software itself is priced reasonably. From the company viewpoint, would it be more expensive to switch to more powerful systems ? That would involve software licensing cost and training cost to get familiar with the system right ?

  2. Clairvoyant
    September 18, 2012

    Good points, t.alex. There is no sense for companies to invest in new software programs if there isn't a benefit in the end.

    Jennifer, what other types of software are being recommended for use in place of spreadsheets?

  3. Barbara Jorgensen
    September 18, 2012

    Somehow, I have managed to dodge Excel my whole life. To me, Excel is still a cipher. But clearly, there are other ways of organizing data. But it is interesting that with many of the supply chain/design/purchasing tools available, they all convert to/from Excel.

  4. bolaji ojo
    September 18, 2012

    Clairvoyant, There are various enterprise resource management software in the market that companies use for managing the supply chain. The point you made is valid, though. Companies use Excel because of its simplicity and efficiency but it is not robust enough for some of the functions required. However, for some firms this is sufficient.

  5. t.alex
    September 18, 2012

    I have seen are companies adopting software system based on SAP (expensive though) to link up all the departments and offshore offices, including manufacturing process. Everything works seamlessly. The challenge is when it comes to their vendors or customers, this system is not able to link up automatically with the other side's system. Excel of course has to be used and redundant data entry work is unavoidable. Here we are talking about the complexity and the lack of standards to interface among these systems.

  6. Cryptoman
    September 18, 2012

    İ agree that the cost of software ownership and licensing is too expensive for most companies. İf their traditional methods of managing information works, they do not tend to change it. İf it ain't broke, don't fix it, right? Also, Excel spreadsheets are quite powerful tools if you know how to use them. İn addition to the internal capabilities of Excel, if you are an average programmer then you have the added capability of developing your own scripts to do more magic with Excel data. To be honest, there is plenty of reasonably priced options when it comes to software tools. Therefore, people often look around bedore committing to buying an expensive software tool.

  7. _hm
    September 18, 2012

    @Jennifer: Why have not you suggested alternate method and compare them both technically and commecially?

     

  8. Jennifer Baljko
    September 21, 2012

    t.alex – sure, switching to a enterprise software system could be quite expesive, and there are different pricing/licensing options. I don't think the choice simply rests in saying something like “oh, spreadsheets work fine and there's no need for software.” Supply chain decisions much be made much faster than before and customers and suppliers demand more information. Poring over spreadsheets isn't really the most robust solution in 2012. Having a more powerful way of analyzing and auditing supply chain decision could put companies in better competitive positions overall.

  9. Jennifer Baljko
    September 21, 2012

    t.alex – to your second point about getting the information beyond internal operations, I bet with all the advancements we're in cloud technology, in a few years — with the right amount of security development — some of those problems may be smoothed out.

  10. Jennifer Baljko
    September 21, 2012

    _hm – not sure if I understand your question. EBN doesn't having facilities/resources to do A/B technical testing of different commercial products… that kind of testing isn't really our expertise, so I couldn't say which products would perform better.

  11. t.alex
    September 21, 2012

    Jennifer, absolutely true. Managing large amount of data is not efficient with excel. I have seen this company who got a new purchase manager, and his first few weeks at work was just going through lots and lots of excel spreadsheets. Small companies do not want to spend money on better software, maybe because they don't see the bigger picture of its benefit.

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