How to Get Cash Visibility When You’ve Outgrown Spreadsheets

“This takes forever,” a finance team member mumbles as he adds the 15th bank account balance of the day to his spreadsheet. He then wonders if the final tally of cash across all accounts on the bottom row is even accurate since consolidating all the bank account data has taken so long. 

Of course, spreadsheets had their place in business, back when there were only a handful of banks and bank accounts to manage. Easy to use, customizable spreadsheet programs allowed Finance to perform calculations with a few clicks of the mouse.  

But with business growth and added complexity, spreadsheets and manual processes are now slowing things down and proving insufficient for getting total cash visibility. If this scenario sounds familiar, your cash management needs may be growing beyond what spreadsheets can support.  

Limitations of Spreadsheets for Managing Cash and Liquidity 

Spreadsheets may present several other challenges when used for tracking and analyzing your cash:  

• Prone to error: Manually entering data into spreadsheets leads to inaccuracies and errors, with estimates saying 88% of spreadsheets contain at least one error (IBM). These can then bleed through to all subsequent financial reporting.   

• Inefficiency: Data entry, toggling between sheets, building formulas, etc. drags down the productivity of the Finance team, no matter how skilled team members are at using spreadsheets.  

• Data security risk: Such manual documents lack security features, since they were not built to house and protect sensitive financial data. Data stored on them can easily be copied, shared, and misused. Plus, they don’t provide detailed audit logs of who did what and when.  

• Inability to provide insights: Spreadsheets do not provide advanced analytical functionality that may be needed when tracking cash across numerous accounts, currencies, subsidiaries, etc. 

• Lack of version control: Employees may save copies of the same spreadsheet and input different information on each one. This can cause confusion, re-work, and data integrity issues. 

If you are spending more time dealing with these issues than optimizing your cash position, you might consider switching to a cloud-based Treasury Management solution that integrates and syncs with all your banks.  

Building the Case for Moving Cash Management Out of Spreadsheets 

Even after outlining some of the specific pain points that come with using manual documents, there will likely be further questions about replacing them with more advanced options. You can answer these questions and make a strong case for upgrading when armed with the details: 

1. Future state of your organization with a better solution in place 

Outline what your organization will gain by replacing spreadsheets with a more robust cash management tool. Highlights can include on-demand visibility into where you stand with your cash and liquidity, improved forecast accuracy, and greater efficiency. Explain how these wins are tied to larger organizational objectives, such as better decision-making capabilities, greater resilience, and improved risk mitigation. Also, be sure to lay out how you will track and monitor these enhancements. 

2. Projected ROI 

Purchasing decisions are under more scrutiny than ever before in today’s environment, so you’ll need to demonstrate that a cash management tool is a good investment. To do so, consider both the tangible and intangible benefits of using a cash management tool. Tangible benefits might include how much time and money you could save by not manually aggregating bank statements, generating cash positions and forecasts, and performing journal entries. Intangible benefits could include things like how much it’s worth to accelerate financial period closing, increase fraud protection, and bolster employee satisfaction and retention. While these latter factors may be harder to estimate, they’re a crucial part of the full value picture. Tally everything up and it becomes clear that you will not only make up any expenditure on a new solution itself, but add considerable value over time. 

3. Project overview 

Give an overview of how a new cash management tool will work, what processes it will automate, what major capabilities it has, and the organizational impact it will have. Include information on what the implementation process and go-live timeline look like and which stakeholders will be impacted. Make any risks and pitfalls known, so these are out in the open. It can also help to discuss alternative solutions at this point, even if the solution is doing nothing and sticking with using spreadsheets. You can, for example, detail how long it will take to obtain your cash position with even more bank accounts, and accounts across geographies in another year or two. 

4. Proposed solution providers 

Do research on the leading cash management solution providers and summarize your findings, clarifying which tools stand out from the pack and why. Highlight how the top contenders align with your departmental and organizational goals. This stage of the process can be made even easier by meeting with and having live software demos with your shortlist of solution providers. This way, you can provide very detailed information on each provider’s differentiators.  

These components can prove key for moving cash management out of spreadsheets, so they’re worth some dedicated time to pull together. You can even work with your potential technology partners on compiling this information, and especially for projecting a realistic ROI. 

Developing A Strategic Approach to a Strategic Investment 

It’s one thing to know that spreadsheets have a limited lifespan for forecasting and managing cash as your team continues to serve a more strategic role in the business. It’s another thing to make the leap to something new for managing the cash lifecycle. Understanding what that transition involves can help pave the way for buy-in from necessary stakeholders.