There is probably a spreadsheet somewhere in your business that everybody depends on. It may have started with a few columns and a perfectly sensible purpose, but over time it has grown. More information has been added, new tabs have appeared and formulas have become more complicated. Before long, it has become an important part of how a particular process is managed.

It is easy to look at situations like this and conclude that spreadsheets are the problem. They are often blamed for creating disconnected information, duplication and manual administration, particularly when businesses start considering a new ERP system.

But spreadsheets themselves are rarely the real issue. They are flexible, familiar and extremely useful business tools. In many cases, the more interesting question is why somebody felt the need to create that spreadsheet in the first place.

The answer can tell you a great deal about where your processes, systems or information are no longer keeping pace with the business.

Spreadsheets often solve a genuine problem

Most operational spreadsheets don’t appear because someone deliberately wants to create another source of information. They usually appear because someone is trying to get a job done.

Perhaps the existing system doesn’t capture a piece of information the team needs. Two systems may not communicate, so a spreadsheet becomes the bridge between them. Reporting might not provide the necessary detail, or a new process may have emerged that wasn’t envisaged when the current system was implemented.

In each case, the spreadsheet provides a quick and practical answer. Someone creates it, the immediate problem is solved and the business moves on.

That is why telling people simply to stop using spreadsheets rarely addresses the underlying issue. Remove the spreadsheet without understanding its purpose and the original problem is still there.

A better approach is to become curious about the spreadsheets that sit around your core business systems. What are they doing that those systems aren’t? Why do people trust or rely on them? What information is being added manually and where does that information come from?

The answers can provide a surprisingly useful picture of how the business really operates.

When a useful tool becomes part of the process

There is an important difference between using a spreadsheet to analyse information and depending on one to run an operational process.

A merchandiser using a spreadsheet to explore a particular set of figures is very different from a team relying on one to track customer orders, manage purchasing, monitor stock or maintain product information every day.

The distinction isn’t always obvious because this dependency tends to develop gradually. A spreadsheet created for one purpose acquires another tab, then another calculation and then another user. Eventually, the business reaches a point where decisions or processes cannot easily continue without it.

At that stage, Excel has effectively become another business system, albeit one that may sit outside the connected flow of operational information.

There is a useful example in the David Luke customer story. Before implementing Protex, its embroidery and decoration service had to be managed separately using spreadsheets. As part of the Protex implementation, Datel scoped those requirements and integrated the functionality into the wider system instead.

The interesting point isn’t that a spreadsheet was being used. It is that a separate operational process had developed outside the core system because the business needed functionality the previous system wasn’t providing.

The problem starts when information fragments

As businesses grow, individual workarounds can accumulate. One team has its spreadsheet, another has a different version of the information and another system contains something slightly different again.

The challenge then becomes establishing which version reflects what is actually happening.

People begin exporting information from one system to manipulate it somewhere else. Updates might need to be entered in several places. Colleagues send files to one another and somebody has to reconcile discrepancies before a decision can be made. None of these activities may feel particularly significant in isolation, but together they create friction throughout the business.

There is also a subtler cost. When people aren’t completely confident in the information available to them, they check it. They ask colleagues for confirmation, compare reports or maintain their own records as reassurance. That creates more manual activity and, potentially, still more spreadsheets.

Over time, the organisation can reach a point where a surprising amount of effort is being spent establishing the facts before people can actually act on them.

Workarounds are telling you something

Rather than treating every workaround as a bad habit, businesses can view them as useful information.

A spreadsheet may be telling you that a process has changed. It could be showing that employees cannot easily access the information they need, that a new sales channel isn’t fully integrated or that an important part of the operation now sits outside the capabilities of an existing system.

This is particularly relevant in apparel, where operational requirements can change considerably as the business develops. More styles, colours and sizes increase SKU complexity. Additional sales channels can create new order and fulfilment requirements. New customers may bring different processes, while overseas sourcing or entry into additional markets can introduce further information that needs to be managed.

The systems that worked when the business was smaller do not automatically evolve simply because the business does. Workarounds can therefore become an early indication that the gap between the two is widening.

Instead of asking employees why they are using spreadsheets, it can be more revealing to ask what problem each spreadsheet is helping them solve.

Not every spreadsheet needs to disappear

It is also worth resisting the temptation to make eliminating spreadsheets a project objective in itself.

There will always be a place for spreadsheets. They are useful for ad hoc analysis, modelling scenarios, exploring information and completing one-off pieces of work. For many activities, replacing them would deliver little or no benefit.

The focus should instead be on the spreadsheets that have become essential to routine operations. If a file has to be updated every day for orders to progress, if several people rely on it to establish current stock or if information continually has to be transferred between it and another system, there is value in asking whether that process belongs somewhere else.

The same applies if only one person fully understands how a critical workbook operates. What began as a convenient solution can gradually create reliance on an individual as well as on the spreadsheet itself.

Understanding that distinction allows the conversation to move away from whether spreadsheets are good or bad and towards whether information and processes are being managed in the most appropriate place.

Look at the process before replacing the tool

Finding a heavily used spreadsheet doesn’t automatically mean the solution is new technology. It may reveal an unnecessarily complicated process, duplicated activity or a historical way of working that no longer needs to exist.

Before recreating the spreadsheet inside another system, businesses should therefore look at what actually happens around it. Where does the information originate? Who uses it and why? Is somebody manually recreating information that already exists elsewhere? Does every step still serve a useful purpose?

This can uncover opportunities to simplify the process rather than simply digitise the workaround.

It also avoids one of the risks of technology projects: taking the way the business works today and reproducing it exactly in a new system, including all of the compromises that have accumulated along the way.

Your core systems should absorb operational complexity

For apparel and footwear businesses, industry-specific ERP has a role to play because many of the processes that create complexity are inherent to the sector. Products don’t exist simply as individual items; businesses need to manage combinations such as style, colour, size and fit alongside purchasing, inventory, orders and fulfilment.

A system designed around these requirements can help more operational information remain within connected processes rather than being managed through parallel tools and workarounds.

That doesn’t mean every spreadsheet disappears, nor should it. The objective is to ensure the core operational information needed to run the business is accessible, consistent and connected.

The David Luke example demonstrates the difference that can make. Alongside bringing previously separate processes into Protex, the company describes having access to timely management information across financial, sales and purchasing activity, as well as using reporting and business intelligence to analyse its operations.

This changes the conversation from eliminating spreadsheets to creating a stronger operational foundation.

Ask why the spreadsheet exists

The spreadsheets in an apparel business can provide an interesting map of how the organisation has evolved. Some will simply be useful working tools, while others may highlight gaps that have developed between systems, processes and the realities of running the business today.

Rather than immediately trying to remove them, businesses can learn from them. Look at where they are being used to bridge systems, manage operational processes or recreate information that isn’t readily available elsewhere.

The spreadsheet may not be the problem at all. The reason your people need it could be telling you where the real problem lies.