Spreadsheets are a go-to tool for countless teams and companies. You might even be using one right now. But is it actually the best tool for storing, managing, and visualizing your business’s data? It’s time that we seriously weighed the advantages and disadvantages of spreadsheets.
Make no mistake: Spreadsheets do offer a wide range of advantages, including that they’re low-cost and that most people are familiar with them. But they can also be difficult to use and don’t integrate natively with marketing, sales, and service systems.
In this post, we’ll break down the advantages and disadvantages of using spreadsheets to track customer information, manage projects, and manipulate data.
1. Spreadsheets are free.
For most businesses, spreadsheet software is readily available and often free. Whether your company uses Microsoft Excel or runs on Google Workspace’s Google Sheets, most people with an internet connection can access a spreadsheet.
2. Spreadsheets require minimal training.
Whether you’ve used a spreadsheet to manage your personal finances, or have spent countless hours building pivot tables for previous roles, chances are you’ve had some hands-on experience using spreadsheets. Outside of building complicated formulas, recording information in spreadsheets is fairly intuitive and does not require intensive training to get the hang of. This makes spreadsheets an accessible option for teams that are scaling fast and don’t have time to train new employees to use complicated software.
3. Spreadsheets are customizable.
Spreadsheets are highly customizable, specially if you know how to use its multitude of formulas and functions. You can create any type of document with a spreadsheet, even a calendar.
Because they’re so customizable, they can also be intimidating to use. You’re not even sure where to begin unless there’s a spreadsheet template available for what you want to do. So if you do want to use spreadsheets for business, it’s important that at least one of your team members knows how to customize a spreadsheet to streamline a business process.
4. Spreadsheets can be more collaborative than other tools.
Most business tools these days provide some collaboration features. For instance, Trello allows teams to manage projects in one interface. But no tool provides the same amount of visibility as a spreadsheet.
Spreadsheets can be freely edited by anyone on the team, so there’s an automatic increase in collaboration. While other tools may bar some permissions based on team members’ titles or managerial levels, there are no such restrictions with spreadsheets (unless you purposefully restrict permissions).
Do note that this is only true for online tools such as Google Sheets. A tool that’s downloaded on your local drive, like Excel, wouldn’t be as collaborative, because the file is only available on your laptop.
5. It’s easy to manipulate and analyze data.
Spreadsheets make it easy to manipulate data. You can add, subtract, divide, and multiply datasets; create pivot tables; remove duplicates; retrieve data from other tabs; and search all rows and columns for a certain phrase or parameter.
There’s a downside to this, however. You can easily break a spreadsheet if you accidentally remove a piece of data that was part of a formula or calculation. It’s also easy to accidentally transfer a cell’s information to another cell, and by the time you catch it, it may be too late to undo it. So you’d have to cross your fingers and hope you remember the data.
6. You can integrate spreadsheets with certain tools.
This is specially true for Google Sheets, which is cloud-based. Using a tool such as Zapier or Integromat, you can automatically upload spreadsheet data onto your CRM or into your project management software — so long as the spreadsheet’s columns match the input fields on the software. If there’s a mismatch, you can expect significant integration errors.
7. Spreadsheets are quick and easy to add into a workflow.
Whereas a dedicated system, such as a piece of sales software, may take time for users to adopt, spreadsheets pose no such challenges. Once you create a spreadsheet and share it among team members, it’s easy to integrate into the team’s workflow — regardless of your team’s size.
8. Spreadsheets are fantastic tools for financial documents.
There’s no other tool like a spreadsheet for creating financial documents such as balance sheets, business budgets, and cashflow statements. Once you’re ready to export the revenue and asset data from your bookkeeping tool, it’s as easy as plugging in the numbers and generating a new spreadsheet statement every quarter.
9. You have access to countless spreadsheet templates.
Earlier, I mentioned that to use a spreadsheet for your use case, you’d likely need a template. Otherwise, it’d be hard to create a spreadsheet that works for you and your team. The good news is that many templates exist for both Excel and Google Sheets. You can find nearly a hundred examples in HubSpot’s business template library.
10. You can visualize data (with caveats).
You can use spreadsheets to visualize data — but you must know how to. On a tool such as the HubSpot CRM, you simply need to access the reporting dashboards tool to see your data visualized automatically. Spreadsheets can do the same thing, but you’ll need to know how to appropriately choose the data so that you don’t get an error.
Once you learn how to handle a spreadsheet’s visualization tools, you can create charts and graphs with ease.
To summarize, spreadsheets may be sufficient for startups in the very early stages, but these advantages are often short-lived. Over time, spreadsheets can become more trouble than they’re worth.
Even for a small company, managing customer information through spreadsheets is at best unproductive and at worst downright dangerous for a variety of reasons. Now let’s discuss the disadvantages of using spreadsheets to track customer information and business data.
1. Spreadsheets are not user-friendly.
There’s no way around it. Spreadsheets are simply not user-friendly. They’re customizable and familiar, but when you need to handle a lot of data, you’ll find yourself scrolling through hundreds, if not thousands, of rows and columns. It’s difficult to make spreadsheets easy to ingest and easy to read.
For instance, take a look at this spreadsheet:
And then look at similar information on HubSpot’s CRM:
Much easier to read and manage, isn’t it? The above view is automatically applied. If you want to make a spreadsheet more user-friendly and easy to read, you’d have to tinker significantly with the colors, font, and font sizes.
2. Spreadsheets are not secure.
As opposed to a dedicated system that requires access to log in, spreadsheets can be disseminated to anyone, anywhere with the simple send of an email. This makes it easy for a disgruntled or dishonest employee to share leads and customer data with external contacts (read: your competitors).
3. It’s hard to tell who edited the spreadsheet.
While spreadsheets are excellent collaborative tools that allow anyone in your team to add information, it’s hard to tell who edited a cell. This can make it difficult to pinpoint the appropriate party if an error happens or if something else goes amiss with the sheet.
In sales specifically, establishing an orderly system to divvy up leads and customers when you’re working from spreadsheets is tough. Unless you train your reps to take meticulous notes and follow a rigorous documentation process, there’s no indication of who last reached out to a customer or prospect, what the content of the message was, and when the interaction took place.
4. There will be multiple versions of the truth.
Everyone might start out working from the same data … but it probably won’t stay that way for long. Every time a rep makes a change to the master spreadsheet, they’ll need to upload it to a central repository for the edits to be communicated to the rest of the team.
And if they forget to do that, you’ll have several versions of the “single” spreadsheet — all with slightly different data. How will you know which one is right? That’s a sure recipe for creating a messy sales process.
5. Spreadsheets are prone to errors.
Well, spreadsheets aren’t prone to errors, but its users certainly are. (Guilty.)
With so many people having their hands on a single spreadsheet, and with so many edits and calculations happening at once, it’s natural that spreadsheets will contain some type of error. If you’re hoping for accuracy, don’t expect to get it from spreadsheets. That’s why it’s wise to invest in a database software that can quickly and accurately resolve errors on its own, or flag them to you for fixing it. Because the worst part about spreadsheets, specially large ones, is that it’s easy to miss errors unless you’re continuously combing it row-by-row.
6. Reporting is painful.
It’s hard enough compiling all the various versions of a spreadsheet into one master copy, but then managers have to assemble meaningful reports based on the data. As anyone who has tried to report from Excel knows, it’s not for the faint of heart. And the more complex your data, the harder reporting becomes.
7. Visualizing data is difficult.
As mentioned, users can create charts and graphs in spreadsheets. But “create” is the key word. Assembling any kind of data visualization in a spreadsheet is time-consuming and frustrating. Managers could opt to skip the visuals altogether — after all, they’re not necessary. But presenting a spreadsheet thousands of rows long is guaranteed to make your team members’ eyes cross.
8. Critical customer data is at everyday life’s mercy.
If you’re using Excel, you risk losing data. Lots of data. Data that lives solely on individual computers can be lost forever if your laptop takes a tumble or gets doused in coffee. While Google Sheets is a great alternative, it can also be subject to data loss if you lose your internet connection.
9. There’s no native integration with business systems.
If you want to connect your spreadsheets to the other systems you use, you’d have to hope that an integration exists on Zapier or a similar tool. If it doesn’t, you’re out of luck, and you’d have to manually transfer the data over to the other systems.
A lack of integration means that customers and prospects might receive redundant information… or none at all. Neither of these scenarios translates into sales or growth for your business.
10. Spreadsheets make it harder for managers to manage team members.
To effectively coach and mentor, managers need to have visibility into the daily actions and processes of their team members. This is all but impossible to do through spreadsheets. Both team members and managers will quickly become frustrated with the seemingly endless cycle of uploading, downloading, attaching, and emailing spreadsheets.
A much better alternative is a project management tool or a CRM that keeps record of all rep activity.
11. Spreadsheets don’t offer mobile access.
This is bad for any team, but it’s specially bad for sales. Mobile access to sales systems has been proven to increase rep productivity — by as much as 24%, according to some estimations. But regardless of the other virtues of spreadsheets, they’re not exactly mobile-friendly. Dragging out a laptop each and every time you need to enter or change customer data gets old in a hurry.
In comparison, the HubSpot CRM offers a mobile app for reps to quickly enter their activity.
12. Spreadsheets are difficult to scale.
Once your company — and your customer list — starts growing, sales spreadsheets will need to as well. However, the bigger the spreadsheet, the more likely it is to contain errors and broken formulas. Not to mention that large spreadsheets are exponentially more unwieldy for users and administrators alike.
Spreadsheets sound like a hard “no,” don’t they? But when do you use a spreadsheet over other types of tools? Let’s go over those instances now.
When to Use a Spreadsheet
When You Want to Manage a Large Dataset At One Time
Spreadsheets are an excellent tool when you need to handle and manipulate a large dataset on a one-time basis. Let’s say you’ve exported all traffic data for your website, and you want to find the pages that earned the most traffic. Spreadsheets can help you see that data for a single date or a single time range rather quickly in one familiar interface.
However, if you want to track traffic over time, spreadsheets aren’t the best tool, because you’d have to export the dataset each time you want to access it. There’s also no way to visualize the data easily. You still could, but you’d have to use complicated formulas to retrieve data and visualize it properly.
When Your Company is Just Starting Out
Spreadsheets are cheap — and sometimes free, as is the case with Google Sheets. When a company first starts out, the money isn’t exactly rolling in. Startups devote all of their cash to their product — and make do with the equivalent of duct tape on the operations side.
This means that when it’s time to track customer and contact data, spreadsheets are the natural choice. It makes sense, too. When you only have a handful of customers, it’s easy to simply pop their information into a spreadsheet and share it with the one or two salespeople on staff.
However, once your business starts growing, it’s important to upgrade to a database.
When No Dedicated Tool Exists for What You Want to Do
In some cases, there might not be a tool that can provide the dedicated organization and collaborative features that spreadsheets offer.
For instance, let’s say that you’re part of a large writing team with distributed team members. You may want a tool that allows you to see and sort through all the articles that everyone’s working on all at once, instead of needing to click from project board to project board, as you’d need to do in a project management software.
Spreadsheets are a great tool for that. Using formulas and functions, you can create a spreadsheet that does exactly what you need it to do.
If you don’t fall under these camps, you’re better off using a database as opposed to a spreadsheet, specially if you’re in sales.
Using Databases Compared to Spreadsheets
Databases are programs that are designed to store, organize, and retrieve data. In sales, the most common type of database used is a client relationship manager, also known as a CRM. First, learn about the benefits of a CRM. Then, let’s compare working with a database to working out of a spreadsheet.
1. A database serves as a central resource.
A CRM database is a tool that stores all of your client and customer contact information in one central place that can be easily accessed by your entire team across multiple devices. This system can organize all of your contact related data, including emails, phone calls, and live chat with customers and prospects.
2. It offers a seamless integration with other software.
Additionally, a CRM database can be seamlessly integrated with your company’s other business systems, including marketing software, which can improve collaboration between your sales and marketing organizations, ensuring your prospects don’t receive the same information or get missed altogether.
3. It’s easy to scale for growing companies.
Spreadsheets are effective at storing basic quantitative data and are often maintained manually. On the other hand, databases are more effective at storing qualitative data, which is why they are ideal for complex businesses with a large customer base or a complex sales process. Databases often have automation capabilities that help organizations save time on manual entry.
For companies that are scaling, or rapidly acquiring new customers in a short period of time, upgrading from spreadsheets to a CRM database can help your company sell to more customers.
Are the advantages of spreadsheets worth bearing the disadvantages?
The benefit of using spreadsheets for business comes down to two main factors: They’re free (with a Microsoft Office or Google Workspace implementation), and they don’t require training.
These are certainly valid reasons — especially for a small company without cash to burn or training resources. But a database tool, such as the HubSpot CRM, is a much better fit for most teams. And the best part? A CRM can be just as low-cost as a spreadsheet. Ditch the spreadsheets along with all of their various problems, and get a CRM to effectively grow your team and your company.
Editor’s note: This post was originally published in April 2015 and has been updated for comprehensiveness.
SOURCE: Sales – Read entire story here.