Avoiding Business Losses by Securing Spreadsheets
Essential for every business, be it big or small, spreadsheets are flexible, easy to use, highly adaptable and form the core of countless business operations.
However, despite all its obvious benefits, Forbes magazine has described Excel, one of the most frequently-used spreadsheet tools, as ‘the most dangerous software on the planet’.[i] Why? Simply because one tiny error in a single spreadsheet can singlehandedly cause colossal financial and reputational risks and losses.
Here Christopher Burke, CEO at Brickendon, discusses with CEO Today the ins and outs of spreadsheets, alternatives and how to keep information secure.
We recently polled a room of risk management professionals at an industry conference and found that only 33% of attendees admitted to having any kind of policy for managing everyday tools like spreadsheets[ii]. In addition, nearly half of the people we polled (47%), claimed their organisations use more than 1,000 spreadsheets for day-to-day work.
This highlights how important the issue of securing spreadsheets actually is, and raises the question of how businesses can mitigate these operational risks? Before looking at a solution, let’s look at the most common spreadsheet errors experienced by businesses.
Types of spreadsheet errors
Spreadsheet risks can be any and many, especially when you consider that the quality of spreadsheet output is usually controlled by just one human working on one computer, using software with, at best, some manual checks.
Firstly, multiple users often copy someone’s “good” spreadsheet and make their own amends to it without knowing the breadth of formulae and underlying structure. With different people doing different things with the same or similar set of data, the possibility of errors escalating increases manifold.
These are relatable situations and can happen to any business, large or small, with the implications for version control alone leaving any business exposed to risk, especially if there aren’t mandated ways of working, or special document control protocols.
So, one perfectly natural reaction would be to restrict people’s access to data, documents or processes, relying on a single expert with ultimate oversight. This is a typical scenario in smaller companies, where fewer contributors should, theoretically, lead to fewer mistakes and more controlled ways of working.
This is great until that one controller then becomes a single point of failure without the back-up of proofing or cross-checking from other teams, let alone potentially overloading work on a single person.
Finally, it can be hard to spot errors in the shape of formulae or code errors and whilst these can be completely beyond anyone’s control, there are some user habits that don’t necessarily help.
For example, if you repeatedly copy formulas from book to book, or use a single sheet for too long, formulas can fail but go unnoticed due to the trust built up in that long-suffering document.
Mitigating risks in spreadsheets
So how can companies secure themselves from such errors and their implications? For us, the solution is two-fold.
Firstly, every business should have an executable compliance policy for managing how all data is handled and allow software to instantly and cost effectively verify compliance to the policy.
These policies should give guidance to staff on how to manage data, how to use and save spreadsheets in uniform ways and help reduce user errors and boost accuracy.
To support this, companies should look to the latest technological tools, including advances in AI and cloud computing, as a means of double-checking, securing and locking down their most important data. This is why the team at Brickendon has built a customisable solution capable of scanning the most complex network of spreadsheets to automatically detect inconsistencies, mis-performing formulas and/or erroneous trends in version control.
Fast and easy-to-use, EUCplus lets businesses take control of their data and protect their operations. It takes away the risk, but still lets organisations carry on with business as usual. It is a simple process to ratify changes to models and calculations, whilst still allowing day-to-day data changes to happen as usual. By registering, scanning and securing the data, EUCplus gives businesses the peace of mind they need to get on with their day jobs.
By keeping the flexibility and simultaneously removing risks from spreadsheets, EUCplus enables organisations to safely allow spreadsheets to be used by all employees, rather than limiting access to a single person. After all, the immense flexibility and multiple functional abilities of spreadsheets do suggest they deserve more credit than they usually get.
[i] *Source: Forbes Magazine “Microsoft's Excel Might Be The Most Dangerous Software On The Planet” https://www.forbes.com/sites/timworstall/2013/02/13/microsofts-excel-might-be-the-most-dangerous-software-on-the-planet/#4f19dd85633d [ii] *The poll was commissioned by EUCplus and conducted at the Cefpro new generation risk conference in London on 13th March. The 52 respondents were all senior operational risk professionals at director level or above.