Why It Is Dangerous To Use Excel As A Database In Your Company

In this article:

Repeat after me: Excel is not a database

We are sorry to report such news. I know the pill is difficult for some of you to swallow. Many people will likely argue that we are wrong that Excel couldn’t be a database, but remember: rejection is only the first stage of the pain. 

The good news is that everything will be fine. 

Excel is a very powerful program, and there are more than a few warlocks out there who can work their black magic. Use the UI to create presentations, dashboards, and datasets with a skill that leaves you wondering whose soul to sell for their skills. 

While the Excel program is robust, there’s no way to keep track of where your data came from, no audit trail, and no easy way to test spreadsheets. But the biggest problem is that anyone can create fake Excel spreadsheets. Because it is so easy to use, creating even important spreadsheets is not limited to people who understand programming and do it methodically and well documented.

And just as we still can’t change metals to gold, we can’t change Excel spreadsheets into a functional database.

You may have big cost if using excel

This is a well-known scenario: you enter your data in a shared table. You try to save it and you get a notification that the workbook is in use. You decide whether to close or lose all of your entries, or to save a copy of the file, and tell yourself you will come back and merge the dates later. But that never happens, and your team gets multiple copies of a spreadsheet, each with a piece of the truth. 

This is a common story. is that Excel only really works when one person has editorial control over the data, and that’s impractical when it comes to large amounts of data that a company’s employees and systems need to access. When only one person is responsible for the data, there is really no one there to ensure that the data and functions are absolutely correct. This leaves room for error, and Excel errors have long been causing problems if not used properly as a database. 

Here are a few examples: 

In 2008, because of an Excel error, Barclays Capital bought 179 bad debt contracts from Lehman Brothers. Barclays “has sent an excel sheet with a list of the contracts to be included in the sales contract. The table contained nearly 1,000 rows with over 24,000 individual cells and needed to be reformatted….. a junior associate reformatting the job did not know that the original Excel document had hidden lines that had contracts marked with an “n” to mean they shouldn’t include it. 

In 2012,  an Excel miscalculation cost JPMorgan Chase $ 6.2 million after a trader added cells instead of averaging them. This became known as “The London Whale Incident”. 

In 2014, Canada-based power company TransAlta lost $ 24 million on a contract purchase when a copy / paste mistake in Excel accidentally increased purchase prices and wiped out 10% of its annual profit.

Why it is danger to use excel as database

To be a database, the software program has to be capable of coping with various inputs from different sources at the same time, and allowing many people to access that software program simultaneously without corrupting or transferring the supply statistics, even updating it in actual time. Excel simply doesn’t do that. 

So how are you going to update your Excel database with a reall database? And what’s going to that even get you? 

I’m happy you asked.

The first (and arguably the hardest) step is cultural. It’s in all likelihood that a lot of your crew participants were using Excel for a huge element in their profession. Don’t be surprised if they reject you. And perhaps no need to make database for them if only 1 to 2 excel sheets. 

Take a look at posted in the Journal of End User’s Computing found 88 percentage of spreadsheets include mistakes. Excel doesn’t have any gear for verifying its inputs in opposition to your uncooked statistics. 

So in case you need to make sure that your statistics is accurate, you’re going to have a proper software.

Questions you need to ask yourself

We can’t give you much advice on the cultural end of things because every company is different, but people who need a database are dealing with data all the time. If in this case, we can help you find out which software is right for you. 

Of course, there are a few things to consider when choosing a database. Here are some important questions to ask yourself:

  • How much data am I storing?
  • How many people need to access this data at once?
  • Does my team know programming?
  • What is my budget?

There are other elements, to be sure, but these will get you started on the right track.

Challenge you may face

After you’ve found out those parameters, you are probably surprised to know that making your database isn’t as difficult as you may think. 

The next challenges you may have been 

  • Most database solution are at high price & expensive
  • It might not be combined properly with your current solutions
  • Or you need to find a solution house to do that which is also expensive

What’s Next

If you find a solution that is cheap, no need for coding to replace excel as a database, feel free to contact us.