8 Ways Excel Wastes Budget for Construction Operations
You’ve been using Excel in your construction business for years. You and your team know it well, and it’s been your go-to program for all of your construction projects.
But, chances are, our team is over-relying on Excel.
Spreadsheets are a great tool, but they're like a hammer. If you use a hammer to build a house, you'll have some areas that are very stable and others that are questionable at best.
The reality is that if you want to do the best job, you need a range of tools.
As comfortable and familiar as Excel is, it shouldn't be your go-to for every process in your construction company. For one, excel is not a database. But, it's also very limited in a lot of ways. And trying to force Excel past those limitations will cost you a lot of time and money.
More than you may realize...
In this article, we’ll show you eight ways Excel wastes budget in your construction company and why you should consider alternatives.
1. Burnout and Toxic Workplace Culture
Who wants to take care of the spreadsheets in a construction company? Nobody.
It requires tedious data entry, extensive knowledge of formulas, and incredible attention to detail. The work is monotonous and unfulfilling. (And that makes it even harder to do all of the above.)
To make matters worse, construction projects are extremely complex with many moving parts. Your employees probably have nightmares about making avoidable errors that slow down (or stop) production.
The pressure is high because if they mess up, it can cost the company a lot of money.
They are less productive, not fully invested in your construction company, and have the potential to drag other employees down with them.
Low productivity and negative employee attitudes are a recipe for disaster. If your business doesn't deliver to its fullest potential, you'll lose money and put your brand at risk.
2. High Turnover
Burnout and negative attitudes mean high employee turnover. Employees do not want to work in an environment that will stress them out.
A high turnover rate means you have to hire and train new employees. On average, it costs $1,252 and 33 hours to train a new employee. And it can take another 8 - 26 weeks to get them fully up to speed (depending on the type of job).
That means less operation budget on construction projects and time wasted on training employees for high-churn positions. Again, that's time and money that you could use to make your construction business more competitive.
It also makes it harder to keep valuable employees who are productive and help the business succeed. Stress, burnout, and high turnover become a vicious cycle that will eat into your bottom line and prevent you from growing your business.
3. Vulnerable to Cyber Attacks
How difficult is it to hack into Excel? Not very. In fact, hackers often manipulate Excel as an easy way to launch a cyberattack.
One of the main problems with Excel is that you save the files on your company’s hard drive. It’s most likely that you share the files with other employees who need to add or check data on the spreadsheets.
Even with password protection on the files, keeping Excel files secure is difficult. The more users who have access to the files, the more chances that someone might be careless.
It only takes one sometimes innocent mistake to share a document with sensitive information through email or on the web. Once there, it’s only a matter of time before the wrong people get a hold of the data.
4. Inaccurate Data
Spreadsheets are NOT databases. When team members enter data, the updates are not in real-time. Ultimately, the data you see may not be the most current.
When you look at the data to make an important decision, you miss critical information because the file hasn't been updated recently.
As a result, you can end up paying too much for materials, scheduling the wrong people at the wrong time, or overlooking a critical component of a construction project.
Human error is also a big issue.
Most commonly, someone manually enters data into the spreadsheet. The chances of an error, like typing the wrong number or leaving out a decimal, are high. Estimates state that 90% of spreadsheets contain mistakes.
A simple mistake can lead to inaccurate pricing, for example. And that error can eat into your margins and interfere with your cash flow.
Ultimately, human error, no matter how small it may be, will cost you money.
5. Lack of Collaboration
Excel is not a collaborative tool. Still, many construction companies try to use it as one, often over email or leaving comments across multiple spreadsheets. Plus, if you want to share data with your team, it's not easy. You need first to pull the data, then print out the spreadsheet, and finally, schedule a meeting to share it.
Aside from the monetary cost, meetings to discuss spreadsheets pull team members away from vital work. And that’s just for one meeting...
Think about how many meetings you need, how many people are there, and how much time each meeting takes.
These are unnecessary expenses that waste critical resources and time for your construction company.
6. Missed Opportunity Costs
Spreadsheets make your business less agile as a whole and bog down your employees. The data is not up-to-date, so your team cannot collaborate quickly. This means you might not see an opportunity until after it passes.
Additionally, your team has a finite amount of time at work each week. If your team spends a good chunk of that time updating spreadsheets and cleaning up the data, they don't have time for other tasks. And they may end up missing multiple opportunities to grow your business because they're underwater with data management.
7. Time-Consuming to Use
Time is money. Using spreadsheets can be a clunky, tedious process. Data entry is slow. Reporting is a process. Analyzing results is complicated. And it takes even more time if you're not a Spreadsheet Wizard.
It's impossible to gather valuable insights at a glance. Instead, you have to pull reports and wait for data to populate. If you're pulling data from multiple, disparate systems, you'll need to interpret that data in a way that's comparing apples to apples. By the time you put it all together, the data is old.
8. It’s Generic
Excel is a program built for the masses to use. Programmers did not create it for the construction industry specifically. They created it for anyone who needs a place to store and analyze data.
Excel does not account for your company’s specific needs.
Going back to the hammer metaphor, you wouldn't use tools for purposes they weren't designed for on construction projects and expect the results to be stellar. The same is true for spreadsheet use.
In effect, you’re relying on a general program tool that wasn't designed with your specific use case in mind. Ultimately, you're left trying to fit your business needs into a handful of rows and columns, hoping for the best.
What's an Alternative to Excel for Construction Companies?
If you want to stay competitive, reduce costs, and scale your business, you need to invest in better systems. For a while, construction has pushed back against custom application development due to the cost, risk, and time involved.
Luckily, low code fixes those problems.
As a team of technology consultants, Quandary works with construction businesses like yours to scale systems. The result is bigger margins, more flexibility, and much less waste.
See our case studies below for the kind of results we bring.