November 2018 Bar Bulletin
By Ryan Gerhardy
More than 600 million desktops have Excel installed. As such it is often the go-to option for any data-
related service. It is pervasive, but if you are using Excel as a cure-all for every business situation that requires data structure, you may be adding to your business intelligence problem rather than addressing it. This is especially the case for law firms that specialize in advising on M&A transactions.
Excel is a very good tool for an individual to enter information to complete a single task. For instance, Excel is my No. 1 choice when preparing a monthly household budget, but it is not appropriate for 10 or more users entering sensitive information to distribute to colleagues to complete workflows and tasks. If you are using Excel to organize your firm’s valuable deal and experience data, here are eight reasons why you should reconsider that choice.
Single permission access. It is difficult to establish user access and control permissions in Excel. For a distributed professional team this causes problems, some of which may be irreversible.
For instance, Excel may not protect against a user who mistakenly overwrites data or accesses sensitive information they should not. In contrast, permission-based databases display only relevant information to a user based on their permission access, so as to limit their ability to influence the data used by their colleagues and not confuse them by providing tools to perform jobs outside of their responsibility.
Inconsistent data entry. Excel databases suffer from field creep. For example, when a user cannot find an industry that they consider appropriate, they create a new industry. This level of inconsistency among records produces data that are not useful to perform the analytical jobs they were intended for.
Pivot table and filters gone amok. When was the last time you used a pivot table in Excel? Excel does not allow records to be easily queried and segmented. Users can apply a filter, or A-to-Z ordering, or a pivot table. But these functions can result in data duplication and an unlimited number of permutations when trying to create a multi-variable query.
Is this the master copy? Nothing is more frustrating than trying to open a shared file and be presented with the following pop-up error message: “email@example.com is currently in this document. Click here to open a read-only copy.” This message is displayed because Excel does not allow real-time access to data or version control to allow display and edit privileges to information that is not currently being edited.
Limited to characters. Excel stores data, not information. Information is not just characters (text, numbers and symbols). A strong database should provide layers of information allowing users to dive deep into a record to find unstructured content accompanying images, documents and real-time connections to outside data sources.
Storage and access. An Excel spreadsheet is a living document and it must be stored somewhere, typically on a shared folder within a file server. Maintaining ongoing access to a “master copy” for a distributed team requires management of file permissions, manual placement of protocols among divisions, and ongoing deny/approve permission requests. Excel does not have administrative controls to limit who can see data, what data they can see and how they can use it.
Excel is not completely secure. An Excel spreadsheet can be easily transmitted or stored outside of the organization. Client transaction data are highly confidential and should be treated carefully every time they are accessed and transmitted.
Users hate using Excel as a database. For all the above reasons and more, user engagement is 61 percent lower when using an Excel database compared to a web-based relational database. A product that streamlines permissions and scales to accommodate large teams is substantially more enjoyable, and your team demonstrates this by using it more often, to better serve clients and the organization.
Ryan Gerhardy is the CEO of Pitchly, a content service platform for M&A professionals to organize and activate their intellectual property. For more information, visit https://pitchly.net/.