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Use Business Tools With Excel
To Save Time and Money

Business tools can improve business performance. Rather than
spending thousands of dollars to support these tools, you often
can use Excel instead.

"Business Tools" are reporting and analytical methods designed to improve business performance or to reduce risk.

Whenever a new business tool starts to generate some buzz, dedicated software tends to spring up to support it. And these days, web pages spring up to promote that software. We can get a rough idea about the popularity of these tools by counting the web pages that promote  them.

To illustrate, the following table shows the hits I found recently when I searched Google for words and phrases that describe a variety of business tools. To judge the relative popularity, I compared the hits to the budgeting software search text in the first line below.

Certainly, some percentage of these hits has little to do with the business topic implied. And many results are from multiple pages within a smaller number of web sites. Even so, these numbers suggest that many different web sites have been set up to sell and support these business tools.

Companies that plan to use a business tool must decide whether to buy special-purpose software, or to use Excel. That decision could affect their bottom lines significantly.

Of course, software vendors will try to convince you that their products offer the best value. At times, they could be correct. But many times, Excel offers the best solution.

The Benefits of Using Excel to Implement Business Tools

Some business tools require such intensive programming or such extensive databases that an Excel solution isn't practical. However, using Excel where it can be used offers significant benefits. Research conducted by Bain & Company makes these benefits even more striking.

Bain found that each company surveyed used an average of about eleven tools during the late 1990s. But in recent years, that number has grown to about sixteen tools.

Bain also found that tools have a life cycle. A business tool that's very popular today could become irrelevant within several years, or last for decades.

These are the key benefits of using Excel to implement business tools:

The Excel Solution Costs Less

When you implement a new business tool, you have two choices. On the one hand you might need to buy an Excel-friendly OLAP product. On the other hand, you typically would need to buy special software to support each business tool that you want to use.

In either case, you already own Excel. And if your company is like many, you also already own the OLAP product. The first choice allows you to use software you already own. The second forces you to buy software for each business tool you implement.

The Excel Solution Is More Flexible

When you implement business tools with Excel, you can implement them to whatever degree you want. And you can modify them to meet your needs.

But when you buy software specifically designed to support a business tool, you buy into the author's design and assumptions about your business needs. Those assumptions might be on the mark, or completely incorrect.

The Excel Solution Adds Power to Your Existing System

Generally, tool-specific software maintains its own database, and often requires data from new sources. This tends to create a "silo" of data that's isolated from the rest of your information system.

On the other hand, Excel solutions -- particularly those using an Excel-friendly OLAP database -- can share their data with other solutions. As a consequence, silos never develop. This allows each new Excel-based tool to benefit your entire system for management reporting and analysis.

In short, when you're thinking about using a new business tool, Excel often is the best software for supporting the tool.