Excel® is great. It’s widely available, easy to use, and capable of some fairly complicated calculations. For example, if you needed to solve for patterns of acoustical radiation, Excel has a built-in formula for it. You can use the program to do just about anything.
You really shouldn’t use it for project controls. Here’s why.
It’s true, technically, that Excel has the sophistication to create files complex enough to manage a multi-million-dollar capital project. And in reality, it’s the de-facto solution for many organizations struggling to bring together project data from a number of disparate systems, such as accounting, scheduling, procurement, and timekeeping. The files they use are terrifying to behold: multi-megabyte monstrosities, often exceeding attachment limits on the org’s mail servers. Usually interlinked with who knows how many source data files, which makes sending the file to someone a challenge. Plus, the sheets are so intricate and complicated that there’s usually just one person in the whole organization who can interpret the information, like the Oracle at Delphi.
What happens when that person is out sick? Or retires?
Even aside from that, how long does it take to get information out of those files in a format that’s meaningful and understandable to stakeholders and project owners? How long does it actually take to create a monthly cost report? When those stakeholders see something that raises a question, how long does it take to provide them a more detailed look? The answer, at least for one organization, is “a very long time.”
As they began a search for a cost-management system, a then-prospective client of EcoSys who relied heavily on Excel conducted an internal review of how their project controls workers – cost engineers, for example – were spending their time. They assumed that the lion’s share would be spent on the high-value work they were hired to perform. The reality, they found, was that more than 60 percent of their time was taken up with low-value, manual-labor tasks like file extracts, duplicate data entry, and compiling reports.
Even if your cost engineers, schedulers, portfolio managers, and other project controls team members spend half that much time on low-value work, it’s costing your organization a lot of money.
Efficiency aside, all the manual interaction with the data – populating spreadsheets, copying a formula, combining information from multiple sources – also leaves a lot of room for error. An analysis of multiple studies suggests that almost 90% of all spreadsheets contain errors, or that in any given spreadsheet, 1 percent of the formula cells is likely to contain an error.
The results of even a single error can mean the difference between project success and catastrophe. A spreadsheet error has been blamed on a $6 billion trading loss.
All that time that could have been better spent on actual project controls takes its toll on project performance. For an upcoming project controls research report, EcoSys and ProjectsAtWork surveyed more than 400 project workers, and those who relied solely on Excel for project controls were far more likely to see poor project performance. Project controls as a discipline includes a significant number of avid Excel fans who swear by the tool, but in this case, the numbers just don’t add up.