Microsoft (NASDAQ: MSFT) Excel was launched in 1985 and it has grown to be arguably the most important computer program in workplaces around the world. In business, literally any role in any industry can benefit from those with a solid understanding of Excel. Excel is a powerful tool that has become ingrained in business processes around the world, whether it’s for analyzing stocks or issuers, budgeting, or organizing customer sales lists.
Finance and accounting
Financial services and financial accounting are the areas of finance that depend the most on and benefit from Excel spreadsheets. In the 1970s and early 1980s, financial analysts spent weeks running advanced formulas either manually or (beginning in 1983) in programs like Lotus 1-2-3. Now you can perform complex modeling in minutes with Excel.
Walk through the finance or accounting department of any major corporate office and you will see computer screens filled with Excel spreadsheets processing numbers, summarizing financial resultsand creating budgets, forecasts, and plans used to make important business decisions.
Most users know that Excel can add, subtract, multiply, and divide, but it can do much more with advanced IF functions when combined with VLOOKUP, INDEX-MATCH-MATCH, and pivot tables. (For more information, see the Investopedia Guide for Excel for Finance: PV and FV Functions.)
Marketing and product management
While product and marketing professionals expect their finance teams to do the heavy lifting of financial analysis, using spreadsheets to list customers and sales targets can help you manage your sales force and plan future sales strategies. marketing based on past results.
With a pivot table, users can quickly and easily summarize customer and sales data by category with just drag and drop.
Human resource planning
While database systems like Oracle (ORCL), SAP (SAP) and Quickbooks (INTU) can be used to manage payroll and employee information, exporting that data to Excel allows users to discover trends, summarize expenses and hours by pay period, month or year, and better understand how their force is distributed job by function or pay level.
HR professionals can use Excel to grab a giant spreadsheet filled with employee data and understand exactly where costs are coming from and how to best plan and control them for the future.
You can do anything with a spreadsheet
The use of Excel for Business has almost no application limits. Here are some examples:
- When planning a team outing to a baseball game, you can use Excel to keep track of your RSVP list and costs.
- Excel creates revenue growth models for new products based on new customer forecasts.
- When planning an editorial calendar for a website, you can list dates and topics in a spreadsheet.
- When creating a budget for a small product, you can list the expense categories in a spreadsheet, update it monthly, and create a chart to show how close the product is to the budget in each category.
- You can calculate customer discounts based on monthly purchase volume per product.
- Users can summarize customer revenue by product to find areas to build stronger customer relationships.
- Use complex calculation methods, such as Sharpe proportions.
Excel is going nowhere
Excel is going nowhere and companies will continue to use Excel as the primary tool for various functions and applications ranging from IT projects to business picnics.
A working knowledge of Excel is vital for most office professionals today, and stronger Excel skills can open the door to promotion and leadership opportunities. Excel is a powerful tool but it cannot stand alone. It takes a savvy computer user to take advantage of all that Excel has to offer to deliver the best results for your business.