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A $ 6 billion loss due to an Excel error? - 6 reasons to replace your engineering spreadsheets

Either loving or hating them, we all use spreadsheets. However, as useful as spreadsheets can be, they are often pushed heavily beyond their limits when implemented calculations grow and are further developed several times, when analytics are performed on the basis of the implemented calculations, or when teams or departments need to collaborate.

Yet despite their failures and frustrations, many companies continue to use spreadsheets for a large percentage of their engineering work. In fact, 9 out of 10 businesses still use them for calculating, analysing, and reporting in their engineering process.

Why? There are many likely reasons, ranging from simple familiarity to the belief that spreadsheets are a low-cost option when compared to other solutions. Or maybe it’s because businesses believe no other viable alternative is available on the software market. But there are options - it’s a matter of doing the due diligence necessary to determine which solution is the right one.

Companies that already replaced their spreadsheets with the right software solution have transformed their engineering process, providing the security, reproducibility and scalability that spreadsheets are lacking.

In our day-to-day business, we found that there are six common reasons why companies have chosen to replace their spreadsheets with better fitting engineering solutions.

Gain tighter control over corporate data

Engineering data is confidential. But a lot of times, this confidential data – which can include calculation know-how, material data from expensive material tests, processing data and much more – is stored and updated in spreadsheets, which presents a potential security issue. Of course, spreadsheets can be password-protected. However, they were never intended to be shared among multiple users where different access rights and authorisations are required.

To address this issue, the ideal engineering solution should offer flexible security levels for persons and groups so that anyone, from the executive level to the front-line user or trainee, can be safely involved in the engineering process. Changes should be easily tracked for audit purposes, and the solution should have built-in version control with the ability to restore old versions to avoid the potential loss of data.

Leverage existing skills

Undoubtedly, one of the main attractions of collaboratively used spreadsheets is that users can build, modify and share engineering calculations without anybody having to learn a specific programming language just because a colleague has implemented urgently needed calculations in one of the developing environments currently available on the market.

As every programming language has its specific advantages and disadvantages and no engineer knows all, but all know some of them, the ideal engineering platform should offer users the ability to interconnect those different development environments (including excel) without any writing of high-level code just by defining the interface properties with some simple clicks. Thus, everybody can use those systems best suited for the task at hand and no calculation part has to be translated into another language.

Become more agile

What does it mean to become more agile? It is the ability to clearly see an issue or opportunity and take action to find the best solution. Why do you need to be more agile in engineering? Because competition is becoming more and more intensive, and engineering needs to become more flexible and has to consider more data aspects and variations.

To become more agile, companies should look for a solution that improves user productivity through faster engineering processes and streamlined data management. Employees should be able to copy and amend existing calculations to create new scenarios, rapidly run through numerous iterations by using sensitivity analysis or advanced optimisers to assess the most likely outcome, and then immediately share it with their peers - all of which can never be achieved in spreadsheets.

Eliminate errors

Do you know how many spreadsheets are error-free? Based on various studies the Forbes Magazine reported in 2014 that more than 90 percent of spreadsheets contain serious errors. And on top of that, more than 90 percent of spreadsheet users are convinced that their spreadsheets are error-free.

Yes, fixing syntax errors, reconnecting disconnected cells and repairing broken macros will eventually make everything work again. But because spreadsheets are so difficult to audit, there’s no way of knowing if all errors were caught and fixed. While some errors are inconsequential, some are big enough that calculation results are highly inadequate and decisions made on it can cause part failure or bigger incidences.

As stated in Business Insider, errors made while copying and pasting data from one spreadsheet to another were partly responsible for a single $6 billion trading loss at J.P. Morgan in 2012. Those minor and major instances can be avoided by replacing spreadsheets with the right work area adequate software solution - but how to decide which solution is the right one for mechanical engineering? As there have been several systems developed, tailored to the needs of business and marketing analysts, the range of solutions solving the specific needs of engineers is much more limited.

Ideally, the right solution allows users establish an integrated review process, add private and public comments to everything included in the system and prevent unintentional modifications.

Improve productivity

Spreadsheets seem like a great low-cost option for doing calculations and analyses because the software is so readily available. But in real life the process of building and amending spreadsheet models is so time-consuming that cost is much higher than originally thought.

Choosing the right engineering solution can increase the business return on time invested by allowing staff to spend more hours doing analyses instead of updating and maintaining data or simply trying to connect and rebuild older spreadsheets which were never be intended to be reused and reconnected.

Simplify your data and know-how management

Many companies still treat spreadsheets as databases, but the structure and flatness of spreadsheets cannot handle the complex dimensionality of engineering data. Any update or change in data has to be manually entered into disparate systems, dumped into various spreadsheets, and reviewed before it can be used. Resulting in filenames like material_data_V2_final_corrected_final_V4, it is at least very time consuming to understand and to reproduce calculations which have been performed some time ago.

To properly plan for the company’s future, users must have easy access to past calculations and their results - which is impossible to do in spreadsheets.


To sum up tools like spreadsheets serve a certain purpose but they do have limitations. To learn more about how replacing spreadsheets can help your business act faster and with more agility, explore www.engidesk.com or request a personal demo.

Posted by Lars Lambrecht on January 26, 2016