I’ve been using Microsoft Excel all my career. I’m skilled in advanced modeling which has helped me, as a CFO, present fast insights into a business. These insights have helped save millions of dollars over the years.
A year ago, something changed for me. I’d been aware of Microsoft Power BI and other dashboard software, but I couldn’t see where to apply it. Then, two hours into a Power BI training course, I realized that I would never use Excel for serious business modeling again.
Power BI connects to data sources, works around poor data formats (we all receive that one nasty csv file from a foreign subsidiary every month, right?) and allows powerful modeling. This cuts through every frustration that I’ve had with Excel over the years. Power BI forces rigid logic (no more hard-coding away an error) giving an end result that is so much more reliable.
Every finance department I’ve ever known has been staffed by people who churn out reports, manually. Sometimes there is printing and re-keying, sometimes copy and pasting. By teaching Power BI to apply the logic used in creating these reports consistently to a complete data set, the manual building of reports stops. That drives efficiency into the finance team–staffing costs are down 18 percent, over $400k/year in my area while the month end close is down from 25 days to 8 days. But the goal is to get information into the business that can save some real money.
Our ERP system is old, difficult to work with and slow. Trapped in that system are vast quantities of data about the $25 million/year we’ve spent on raw material over the past 15 years. Trapped until now, that is. Instead of giving our purchasing team paper reports to manage this spend, they now have an interactive dashboard. They can select purchase history based upon common characteristics, so they can see trends. They are better able to decide upon which vendor to use to maximize discounts by looking at common purchases. Every 1 percent they can save with this information is worth ¼ million dollars.
"Power BI connects to data sources, works around poor data formats and allows powerful modeling"
We employ over 1,000 people costing in excess of $60 million/year. Two years ago we had poor visibility of the drivers behind this cost, leading to a financial consolidation and planning software which was easily implemented, we mapped hours and headcount into a new structure, aligned with a remapping of our ERP general ledger. We then used Power BI to bring the newly restructured data to life. Instead of leaving financial review meetings with a list of questions about the details behind labor costs we now display the answers – down to name, job title and hours worked–on a screen, in the meeting. Providing management with this tool has driven a significant reduction in overtime.
Our ERP system does not prevent us from entering duplicate invoices into different companies in our group, but Power BI means that I get an alert as soon as this happens. Accounting for health insurance used to take several hours per week, it now takes minutes. Our Accounts Payable process is now completely paperless. Our parts management team now has real time visibility of which machines or mechanics are consuming parts. Reports needed for month end are now available instantly, saving hours. We’ve built a job costing system, the first time the business has been able to see this information. Utilizing existing data, Power BI has genuinely opened up these opportunities to us, without major investment in systems.
It’s not just about software, which would be useless without teamwork, culture and leadership. I’ve built a core team of Power BI developers from existing team members, people who were talented but underutilized, performing data entry or similar non value adding tasks. Now they are working on exciting business improvement projects, gaining skills which will make them highly prized employees for the rest of their careers and, more than anything, they feel that they’re making a difference.
We all see reports about robots taking our jobs, artificial intelligence and machine learning. This conjures up images of C3PO or Metal Mickey. But that’s not what the future looks like. The future looks like what we’re building using Power BI. We’re teaching Power BI to apply the same logic that has been employed manually for many years. This makes us more efficient. If we don’t use these tools while our competitors do, the future is bleak. If we embrace new tools like Power BI and learn how to develop models and turn the information we’ve unleashed into a commercial weapon, we have no need to fear that the robots are coming to take our jobs.
Any competent Excel user can learn to use Power BI. If you don’t, someone else will.