Spreadsheet Hell

CFOs are interested in the many new technologies being pitched to them, but are they really trapped in spreadsheet hell?

Another force for change is the ongoing drive to reduce the cost of finance. CEOs continue to demand that such cost centers as finance be leaner, while making a greater strategic contribution. Because of its ability to automate routine tasks, technology will be vital to this effort.

Consider Delta’s experience. When the airline industry suffered a sharp decline in demand following September 11, 2001, the company had to make deep cuts in all areas. Finance was able to use Delta’s new SAP system to do its part. By redesigning and automating finance processes as part of the implementation, the department was able to reduce staffing by between 15 percent and 20 percent, and dedicate more employees to providing decision support to the business. “We’ve greatly reduced the amount of finance staff time spent on transaction processing,” says Fisher. “Now we spend much more time on business matters.” Delta had a curious advantage, Fisher says, in that its hodgepodge of systems were so cumbersome that when the company consolidated on a single ERP system from SAP in 2001, “we didn’t have to worry about people being reluctant to learn a new system — they said, ‘I don’t care what the new system is, I’ll embrace it.’ ”

More important, Fisher says that a single ERP system offered a way out of spreadsheet hell because it provides a uniform source of data that all spreadsheet analyses rely on. “In the past, you would sit in a meeting and several people would offer up business models, and you’d have to spend time sorting out what everyone’s assumptions were based on,” he says. “You couldn’t even get to a discussion of whether the business case was good or bad because you were bogged down trying to understand what one spreadsheet was saying versus another. That’s spreadsheet hell.”

ERP, of course, is not new, although the major vendors constantly add new modules and capabilities to it. Among the more purely new technologies of most interest to CFOs, five rise to the top: corporate (or business) performance management, a.k.a. CPM/BPM; E-procurement; portals; E-payment/E-billing software or services; and dashboards.

Teach Them to Fish

What these technologies have in common, aside from the inevitable promises that they will provide near-instantaneous payback, is that they help finance departments do less paper-shuffling and more analysis. E-procurement and E-payment/E-billing (technologies sometimes collectively known as financial supply-chain software) help free finance from much of its routine accounting work. CPM/BPM, portals, and dashboards are tools that help finance satisfy the business’s demand for better visibility into the drivers of growth or the sources of trouble.

Frank Figueroa, CFO of Sandia National Laboratories, which is owned by the U.S. Department of Energy but operated by Sandia Corp., a subsidiary of Lockheed Martin, is interested in visibility, on several levels. “As much as I’d like to drive down the cost of IT,” he says, “if that spending helps us achieve our objectives, then that’s fine. I would just like better insight into which IT projects provide the most contribution to our strategic objectives.”

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