The Importance of Using Spreadsheets in Business

Spreadsheets are an essential tool for many business professionals. As a productivity tool that
can also be used to improve communication, spreadsheets offer benefits to a diverse range of
departments within a company. When used strategically and regularly, spreadsheets can
abolish the need for expensive software for any department it serves.
Presentations
When preparing a presentation for a meeting, a spreadsheet can help you organize your
information. You can print spreadsheet tables, graphs and calculations to share with other
attendees. Tangible references make your presentation easier to follow and give meeting
attendees a reference for future use.
Illustrating Scenarios
Spreadsheets allow businesses to compare and contrast information quickly. If a business
professional need to know the financial impact of a certain task or action, he can rely on the
use of a spreadsheet. Multiple tabs can be added to spreadsheets so the document holds a
variety of spreadsheets in one. This can be useful in scrolling between hypothetical business
scenarios before making a final decision on a project.
Budgeting
Budgeting is a common use for spreadsheets. With a layout consisting of rows and columns,
spreadsheets allow for the quick formatting of a business budget. Accounting professionals
can add budget categories as needed and share the information with decision makers in a
clear format. As numerical data changes, accounting professionals can make quick changes
creating multiple electronic budget formats to track adjustments.
Formulas
Spreadsheets allow businesses to compile and organize business intelligence. Spreadsheets
can quickly calculate percentages and totals of data compiled from marketing research
studies. Formulas can be set up between tabbed pages to show how information is
interrelated. Without the help of a spreadsheet, all calculations would have to be conducted
manually, which leaves increased room for error.
Task Management
Spreadsheets are frequently used in project management. Managers can assign tasks by
creating grids with the names, responsibilities and due dates for each person in a department.
Each person in the department can view how tasks are allocated with ease. This benefit
extends to event planning, managing marketing campaigns and a host of other deadline-
oriented group projects.
Finance and Accounting
If you walk through the finance or accounting department at any major corporate office, you
will see computer screens filled with Excel spreadsheets outlining financial results,
budgets, forecasts, and plans used to make big business decisions.
This is the area of business with the biggest reliance and benefit from Excel spreadsheets.
Advanced formulas in Excel can turn manual processes that took weeks to complete in the
1980s into something that takes only a few minutes today. If you would like to learn more
formulas, Investopedia Academy has an excel for finance course.
Most users know that Excel can add, subtract, multiply, and divide, but it can do much more
with advanced IF functions when coupled with VLOOKUP, INDEX-MATCH-MATCH,
and pivot tables. (For more, see the Investopedia Guide To Excel For Finance: PV And FV
Functions.)
Marketing and Product Management
While marketing and product professionals look to their finance teams to do the heavy lifting
for financial analysis, using spreadsheets to list customer and sales targets can help you
manage your sales force and plan future marketing plans based on past results.
Using a pivot table, users can quickly and easily summarize customer and sales data by
category with a quick drag-and-drop. All parts of business can benefit from strong Excel
knowledge, and marketing functions are not exempt.
Human Resources Planning
While database systems like Oracle (ORCL), SAP (SAP), and Quickbooks (INTU) can be
used to manage payroll and employee information, exporting that data into Excel allows users
to discover trends, summarize expenses and hours by pay period, month, or year, and better
understand how your workforce is spread out by function or pay level.
HR professionals can use Excel to take a giant spreadsheet full of employee data and
understand exactly where the costs are coming from and how to best plan and control them
for the future.
You Can Do Anything With a Spreadsheet
Using Excel for business has almost no limits for applications. Here are some examples:
 When planning a team outing to a baseball game, you can use Excel to track the
RSVP list and costs.
 Excel creates revenue growth models for new products based on new customer
forecasts.
 When planning an editorial calendar for a website, you can list out dates and topics in
a spreadsheet.
 When creating a budget for a small product, you can list expense categories in a
spreadsheet, update it monthly and create a chart to show how close the product is to
budget across each category.
 You can calculate customer discounts based on monthly purchase volume by product.
 Users can summarize customer revenue by product to find areas where to build a
stronger customer relationships.
This is a very short list to give you an idea of the diverse uses for Excel. On a typical day at
the office, I have Excel open 4-8 hours. I could not do my job effectively without it.

VIVA Questions
1. What is importance of spreadsheet?
Spreadsheets are an essential business and accounting tool. They can vary in complexity and
can be used for various reasons, but their primary purpose is to organize and categorize data
into a logical format. Once this data is entered into the spreadsheet, you can use it to help
organize and grow your business
2. Why Excel is important?
Why Microsoft Excel Is Important For Business Organizations. ... MS Excel is used for
various purposes by business establishments. Some organizations use this spreadsheet
software for generating memos, track sales trends, and other business data.
3. What are the advantages of using Excel?
Microsoft Excel's graphing capabilities allows you to summarize your data enhancing your
ability to organize and structure your data. Powerful analyses of large amounts of data -
Recent upgrades to the Excel spreadsheet enhance your ability to analyze large amounts of
data.
4. What are some common uses of spreadsheets?
The three most common general uses for spreadsheet software are to create budgets,
produce graphs and charts, and for storing and sorting data. Within businesss
preadsheet software is used to forecast future performance, calculate tax, completing basic
payroll, producing charts and calculating revenues.
5. What are the disadvantages of spreadsheets?
 Collaboration is Limited. ...
 Lack of controls, vulnerable to fraud. ...
 No log of change. ...
 Not prepared for disaster. ...
 Susceptible to costly human errors. ...
 Difficult to troubleshoot or test. ...
 Regulatory compliance challenges. ...
 Hard to manage data security.
6. What careers use spreadsheets?
 Administrative Assistant. Administrative assistants are responsible for helping the
organization they work for run smoothly by completing a variety of different tasks. ...
 Information Clerk. ...
 Accountants and Auditors. ...
 Cost Estimator. ...
 Financial Analyst. ...
 Sales Manager.
7. What are the examples of spreadsheet packages?
 Google Sheets - (Online and free)
 iWork Numbers - Apple Office Suite.
 LibreOffice -> Calc (Free)
 Lotus 1-2-3 (Discontinued)
 Lotus Symphony - Spreadsheets.
 Microsoft Excel.
 OpenOffice -> Calc (Free)
  VisiCalc (Discontinued)
8. How many rows and columns are there in Microsoft Excel spreadsheet?
By default, excel places three worksheets in a workbook file. Each worksheet can contain
maximum limit of 1,048,576 rows and 16,384 columns of data. Excel cannot exceed the limit
of 1,048,576 rows and 16,384 columns.