The Challenges of Modeling using Excel
Excel is the most widely used financial modeling tool, with an incredibly
rich set of functionality and flexibility. However, the reality
of how it is used also makes it one of the most risky tools in use.
Common Reality
- Uncertain that hidden issues will appear
at the last moment, delaying critical reports and tarnishing your
team’s reputation
- Lack of consistency across your team's models
leaves you exposed when someone leaves
- Some of the models are so fragile, there
are sections no one dares to touch
- Junior members of the team, doing the bulk
of the work, may not be as Excel proficient as they confidently
present
The Gap
A wide gap exists between Excel's potential and its actual use.
This gap is costly:
- In time lost
- In unnecessary stress as analysts strive
to meet key deadlines
- In credibility and monetary losses (sometimes
substantial) due to undetected errors in their spreadsheets (see
www.eusprig.org/stories.htm
…).
Now with Sarbanes-Oxley, not only is this gap costly, it is becoming
a liability.
Ryan Excel Consulting was conceived to help firms close that gap.
By harnessing the full power of Excel we help you raise the effectiveness
of your team, and achieve shorter development times, fewer errors, and
better control, security, and predictability.
Reasons for the Gap
The gap between actual and potential Excel modeling
is due to many factors:
- Most users are self-taught and learn on the
fly in the midst of critical deadlines
- With the fast pace of most financial departments,
users rarely find the time to explore Excel, and end up using the
same inefficient techniques they have always used
- Even when users are aware of Excel features
that would improve their modeling, there is no easy way to quickly
get up to speed – Excel's help gets less helpful with every release
and there is too much on the web to sift through
- Excel's flexibility is a double-edged sword
– an infinitely flexible modeling tool is easy to use poorly, resulting
in complex and hard to read models with undetected errors
- Excel’s breadth of functionality is truly
overwhelming, and most users rarely get competent with more than
the basics
- Some of Excel's features specifically reduce
errors and development time, but these features are unknown, or
untried, by most users.
- Excel training courses attempt to cover too
much material and use simplistic examples – this leaves users with
little practical knowledge to apply to their own unique work situations
- Little time is spent on modeling best practices
either at Excel courses or in work environments
Our goal is to narrow that gap by helping your team harness the full
power of spreadsheets to deliver models with less effort, errors and risk.