The application that wouldn’t die is still the finance industry’s go-to spreadsheet option.

Liz Lumley headshot

There are a number of competing conventional wisdoms in start-up land. One is that in order to cause true disruption and monopolise a market your new innovative product needs to be ‘10 times better’ than whatever it is replacing. Think of the convenience of calling up a cab via an app on your phone, with the payments and routes taken care of digitally, versus searching for an ATM for cash and waiting on a street corner in the dark (often in the rain) for the lit taxi light beacon of hope to arrive.

Another rule – and one that not many innovators adhere to – is that you should always offer customers a solution to whatever problem they are experiencing in the simplest and least complex way. (This is the design methodology that lies behind the devotion of millions of Apple fans.)

I was thinking of this dichotomy during the recent release of Citi’s Treasury Diagnostics Report and Survey, its global corporate benchmarking survey designed to help companies assess their treasury, working capital and risk management practices. The report surveyed the opinions of more than 475 large companies from a diverse range of industries and geographies.

The survey found broad client interest in “all things digital”, but also “low levels of automation and connectivity with bank systems highlighting the inability of some companies to effectively integrate their technology ecosystem”. One statistic jumped out at me: “Despite the availability of advanced cash forecasting technologies, only 34% use statistical analysis of previous patterns to predict forward and 80% remain reliant on Microsoft Excel as a component of the tech stack supporting the forecasting process.”

You should always offer customers a solution to whatever problem they are experiencing in the simplest and least complex way

Ah – the humble Excel spreadsheet, included as standard in every package from consumer to business of Microsoft Windows. When risk managers research and plan against ‘spreadsheet risk’, it isn’t hard to guess which ‘spreadsheet’ they are referring to. (I once wrote a 10-page report on spreadsheet risk back in 2007: the widespread use, love and ‘risk’ of Excel has been with us for a while.)

In the September issue of The Banker, Aurélien Viry, global head of payments and cash management at Société Générale, opined that the increasing use of digital and ‘…as-a-service’ offerings might finally kill off Excel, which he called “one of the best friends for treasurers”.

As I write, I have three Excel spreadsheets open on my laptop. Granted I use the MS application to organise my workload and create accessible contact lists, rather than cash forecasting for a multinational corporate treasury. Risk is not constant, but instead variable and relative to context.

So here we are in 2021 having spent the past 18 months living through unprecedented digital transformation accelerated by a global pandemic, supposedly. (It must be true, I’ve heard it at least 1000 times from the great and the good of banking and fintech over the past six months.) We all strive to be ‘digital first’, innovate our industry and create greater efficiencies. Digital offerings and ‘transformative technology’ should be 10 times better than a Microsoft product that was released when Prince Charles was still married to Princess Di (and Wills and Harry were on speaking terms in the nursery). But when push comes to shove, many of us reach for the simple, easy-to-use, less complex option (like 80% of those Citi surveyed corporate treasures) and fire up that Excel spreadsheet.

The reality is not when Excel will be replaced, but when it might be uninstalled from your cold, dead, laptop.

Liz Lumley is the technology and transaction banking editor at The Banker.

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