I love Excel for analysis….but I hate it for peer benchmarking.
It’s really the wrong tool for the wrong job when it comes to building a robust peer benchmarking program. True, there’s nothing better than getting your vlookups working or building a great pivot table. I’ll gladly admit I’ve spent countless happy hours fiddling with charts and slicers to get them just right for projects.
But it’s just not a good fit for a robust benchmarking platform.
If you’ve ever asked “Should I use Excel for this?” then you’re in the right place. Here are six reasons why you should never, ever use Excel for benchmarking.
1) Data Security & Anonymity
There’s a distinct lack of security in the way people use Excel that is terrifying for storing important data.
Excel stores a lot of data. It’s entered into cells, aligned by rows and columns, and then that data becomes part of the spreadsheet. Send someone the file, and all of the data goes with it. They own it now. There’s a distinct lack of security in the way people use Excel that is terrifying for storing important data. Excel does have some privacy controls, but it can take an advanced degree to understand the nuances. If done wrong, you’re completely shut down with no choice but picking up the phone and begging for help.
When peer benchmarking, using Excel also means that you’re sending it to any number of people outside your control. Suddenly, your data is completely out of your hands – a lapse in data security. Imagine you were benchmarking wages in your company, and your data finds its way to an unhappy employee. What’s stopping them from sharing your data? What’s stopping it from showing up on a public message board, or in a competitor’s hands? Nothing, unless you have your security perfectly-configured.
Peer benchmarking software like Baromitr makes privacy simple. Strong user management policies are baked in, so the right people have the right access and nothing more. It also ensures that privacy is maintained through a variety of anonymization and security techniques. Sensitive information won’t find its way to anyone that shouldn’t have access.
2) Admin Controls and User Management
In Excel, you’re either going to fight a long, uphill battle with complex processes or you’re going to give away data that you shouldn’t.
Peer benchmarking critically relies on the ability to compare your own data against a larger group. Within Excel, in order to build that into a spreadsheet, the original owner of the spreadsheet must have access to all individual data points to create the group benchmarks, and then provide access to them. If you find yourself unlucky enough to be the owner and building benchmark analysis like this in Excel, you’re either going to fight a long, uphill battle with complex processes or you’re going to give away data that you shouldn’t.
Peer benchmarking software like Baromitr removes the risk and the effort from sharing these insights. Rather than the constant worry about who sees what when in a spreadsheet, good peer benchmarking software keeps insights anonymous and ensures that group members get exactly what they need.
3) Automated Update Cycles & Taxonomical Standards
Excel files can break in any number of subtle ways.
At their core, spreadsheets like Excel are “whiteboards” for data analysis. As they have grown more robust, so have the many ways in which the data, and its resulting quality, can be degraded and/or destroyed. Numbers can get formatted into text, Date fields rendered illegible when accidentally converted, entire sheets deleted when saving to the wrong format. That’s before we even consider taxonomical standards! The moment you share a spreadsheet with another person all bets are off, especially if that other person is outside your company. Excel files can break in any number of subtle ways. The core problem, as James Kwak explained in his breakdown of the 2013 London Whale Trade fiasco (caused by an Excel error), is that “anyone can build a spreadsheet – badly”.
Good peer benchmarking software like Baromitr completely eliminates data quality issues and process fragility. Strong data delivery rules ensure that field formats never change, while it’s impossible for a user to modify the rules of calculation. Baromitr also guarantees that no user can modify the calculations or the interface for anyone other than themselves.
4) Data Review Process
The designer of the file has turned Excel into a database.
It happens all the time. You open an Excel file and find it contains dozens of tabs, each identically formatted and titled to reflect a date or a category of the data you’re analyzing. The designer of the file has turned Excel into a database. And unfortunately, it’s a poor substitute. Why? They’re prone to breaking, rely on local computer memory, and they often require a full rebuild just to add and analyze another data point.
Good benchmarking software is built on strong data design. In Baromitr, the data review process is seamless. That means there are few technical limitations on data size, the number of users, or the number of iterations available. Better yet, it’s designed as software so you don’t have to worry about making a modification and accidentally…anything.
5) Administrator Controls
How can you guarantee that the members of your peer benchmarking group all get the insights they need if they’re all using different (Excel) versions with different capabilities?
I love what Excel has done in recent years with Excel Online, OneDrive and SharePoint integrations, and PowerBI. That same product expansion is also a huge problem when you use Excel to power a peer benchmarking program. Over the last seven years, there have been 3 very different versions of Excel released which are all still in active use, and which differ across operating systems and devices (try running a Windows Excel macro in MacOS). All of these are in addition to Excel Online, which has completely different functionality from the standard desktop versions. How can you guarantee that the members of your peer benchmarking group all get the insights they need if they’re all using different versions with different capabilities?
Good peer benchmarking software like Baromitr is browser-based, uniform and universal. If you have a web browser and a stable internet connection, you’ll get the same experience regardless of which one you use, even across operating systems, devices, and physical location.
6) Product Support
Product support of your specific benchmarking process doesn’t exist in Excel (and could spell your doom).
The more comprehensive Excel files become, and the more you rely on them, the more likely they are to require full-time support just to maintain. Storage, backups, analysis, versioning…all of this takes time, and that’s before you get to the fun part of data analysis. Once you start analyzing the data, then there are graphs, charts, tables and more to manage. Then begins the challenge of getting data to your members. And what about that rockstar analyst that built it then moved to another department? Or left the organization entirely? Product support of your specific benchmarking process doesn’t exist in Excel (and could spell your doom).
Repeatable tasks, especially in high value situations, can and should be easily handled by software. Baromitr takes the effort out of managing updates in your program and gives you more time to focus on your group while also guaranteeing consistency in measure of benchmarks. Additionally, Baromitr comes with product marketing support, detailed onboarding, automated messaging, and product guides – all baked in and ready for you to use.
Have I mentioned how much I love Excel? It’s one of the most important tools businesses have for analyzing and understanding data. It’s just not the best fit for a sustainable and scalable peer benchmarking platform.
If you’re interested in starting a benchmarking program, or if you’re currently in the middle of one that relies on Excel for insights, contact us , or request a personal demo to learn more about how Baromitr could be a great fit for your needs.