Why Using Spreadsheets for Purchase Orders Is a Bad Idea

So, your organization uses purchasing spreadsheets to handle a multitude of critical procurement processes and, in effect, to help manage entire departments.

Business software, ever evolving and innovating, has long concentrated on eradicating offices of the “dreaded” spreadsheet. Making business “better” – quicker, more visible, easier to fix when needed – is indeed big business itself. You and, where applicable, your superiors, are all aware of this pervasive mandate, yet your company hangs on to spreadsheets.

Operations? Marketing? Sales? All are candidates for spreadsheet dependency. But there’s more – even finance departments are still using Excel.

And it’s causing some problems.

Why using purchasing spreadsheets for purchase orders is a bad idea: an example

According to a survey by California consultancy Ventana Research (as published by business blog Tech Target), there are 4 main areas of concern – or, better yet, operational problems – when using Excel spreadsheets in your always important function.

They are:

  1. Using multiple spreadsheets can reveal data discrepancies. This is an operational mess. Your finance department is actually using more than one spreadsheet (potentially because the department is a large one) and the numbers, when analyzed, aren’t matching up. And which one is the right one? That will take valuable time to figure out.

  2. Spreadsheets waste individual’s time. We touched on this briefly at the tail end of the last entry. Spreadsheets, simply put, force its users to spend more time organizing and analyzing data than they would if they had more advanced business software at their disposal.
  3. When do errors get noticed? Short answer: when it is too late. Sifting through voluminous data on spreadsheets can be slow (at best) and promotes mistakes. And furthermore, who is going to offer to do it? It’s fair to say such a task will not yield lineups of volunteers.
  4. Spreadsheets waste company time. Because using spreadsheets is a slow process for those forced (or…not so forced) to use them, then the department those employees work in, in this case finance, are going to collectively take longer to accomplish tasks. That sounds like a simple, and obvious connection, but its effects can be dramatic. If the finance department takes longer to close end of the month reports, that sets the entire organization behind. And that setback, of course, can be costly.

Spreadsheets and your purchasing department

Of course, your organization’s purchasing department is no exception to this trend either. In fact, just as it is troublesome in finance, using purchasing spreadsheets for purchase orders (and in your purchasing process as a whole) is a bad idea.

Why? Well, for more or less the same reasons that it affects finance. That’s why a quick analysis of the finance department is an apt examination. Again, spreadsheets are slow and promote errors – and your purchasing department deserves better than that.

So, what can be done? To put it simply, start using procurement software.

Procurement software helps avoid errors, but more importantly, well-designed software erases the “time suck” inherent to spreadsheets. For example, procurement software such as Procurify clearly outlines all requests, approvals and budgets, as well as offers a number of different reporting options.

By offering a clear audit trail, and real-time visibility into your company’s spending at all times, sifting through those spreadsheets truly becomes a thing of the past. Save your purchasing department time – using spreadsheets for your purchase orders – or in your entire purchasing cycle – is a bad idea.

But don’t stop there. Help all of your departments.

And, finally, say goodbye to spreadsheets.