Using Excel Spreadsheets for Project Management? You Might Want to Reconsider.

 

Browsing the Internet, you will find various Excel project management templates: a Gantt chart template, budget template, project timeline template, etc.

Apparently, many companies still rely on spreadsheets to plan and manage their projects. When talking with resource management software users, we often learn that they used to utilize spreadsheets to track time or track employee time off. 

What’s the big deal then? If Microsoft Excel templates are working out for a company, should they still invest in a dedicated PM tool? This blog post aims to allow you to evaluate whether spreadsheets are genuinely practical for your organization. If they are, then great, but you’ll likely see hidden costs of using them for project and resource management.

Why do companies use spreadsheets for project management?

Before we discuss the numerous issues you may face when relying on a spreadsheet for project tracking or project and resource planning, let’s talk about the reasons for using them in the first place. In our opinion, companies decide to manage their projects with Excel because spreadsheets seem accessible, easy-to-use, and free. After all, basically, everyone has a spreadsheet app installed on their machine. Cloud alternatives like Google Sheets are also widely available. The thing is that, although popular, spreadsheets haven’t been designed for project management purposes. As a result, using them as such can be anything but easy, free, and efficient.

Main pitfalls of “Excel project management”

Let’s discuss the biggest problems project managers have to tackle when using spreadsheets to create a project plan or manage ongoing tasks.

Spreadsheets are:

• time-consuming to use. Say that your team has figured out effective ways of planning and managing projects with spreadsheets. Perhaps you have even prepared project management Excel templates that work well for your business. Still, organizing, updating, and connecting spreadsheets can be a very tedious and time-consuming process. Imagine implementing even the smallest tweaks to your Excel Gantt chart and having to recolor a bunch of cells. It’s like interacting with an adult coloring book, but not in a fun way.

• not suited for real-time project tracking. When you rely on Excel files, you can’t be sure that they’re up-to-date or that there aren’t multiple versions of them circulating around. With cloud-based sheets, the situation is better, but other limitations of spreadsheets still apply here.

• not easy to master. Since everyone has some experience using spreadsheets, they should be an intuitive go-to tool for your team members, right? Sure, when we talk about very simple tables and lists. However, to compensate for missing PM features, you will likely need to incorporate advanced formulas or add-ons that may have a steep learning curve for your employees.

• limiting. Again, spreadsheets haven’t been designed for project management or resource management. Thus it’s not surprising that they lack many useful features your team member will often need. You can’t store files there, add notes, or gather feedback. Now, we’re sure some of you will counter that statement and say: “of course, you can do these things. You just have to make some workarounds.” However, such workarounds may take a lot of time to build and hence cost some serious money. Plus, they ultimately may not be as effective as a simple PM app could be.

• not suited for collaboration. There’s a particular paradox when it comes to managing projects in spreadsheets. On the one hand, you want to include your team members in the process and let them participate in task management or resource allocation. On the other hand, the structure of spreadsheets and formulas used within them can be very easy to mess up, so you might not be willing to let multiple people collaborate on them.

• prone to get complicated. Yes, it’s possible to plan a single aspect of a project in a spreadsheet. However, when your company is working on large projects, the spreadsheet structure will soon grow to multiple files/sheets. The reason for that is that it’s difficult to reflect projects’ multiple dependencies and relations within a single sheet. Of course, a complex spreadsheet structure can be really difficult to navigate, especially for new team members.
• not presentable to your clients. It’s typical for clients to want to have some insight into the project’s progress or the budget’s current state. Sending them a complex and cryptic spreadsheet will not be an optimal solution. As a result, project managers spend hours writing down project status reports and creating presentations for clients. It’s additional labor that could very well be avoided (how? See the next section of this blog post).

How do resource planners replace spreadsheets for project management?

First of all, dedicated project and resource planning tools solve the challenges presented in the previous section. They’ve been built with these particular processes in mind, so, naturally, they have features to support planning projects, scheduling resources, or updating the project schedule. On top of that, they typically offer the following features that could further boost your team’s performance and save you a lot of time and money:

• Project reports. Imagine that you can quickly generate a project management dashboard to keep an eye on the critical metrics or export a visually appealing report for your client. PM and resource management apps allow you to easily calculate main KPIs like the burndown rate, resource utilization rate, or profit margins. Not only can you impress your clients with accurate reports, but you can also use these analytics to find optimization opportunities inside your organization.
• Real-time notifications. Sure, you can set up spreadsheet notifications using some creative workarounds or apps like Zapier. Still, tools for project managers usually offer you built-in notifications and integrations. For instance, you can get a nudge every time a task is completed, or a new vacation request from your employee is submitted.

Of course, robust project management software will help you solve many more issues you might be currently facing. The key is to pick an app that fits your team’s needs and makes sense for your company’s budget.  

Alternatives to spreadsheets and Excel in project management

Many organizations ask themselves whether or not they should spend money on apps when there’s a free alternative like Microsoft Excel. Fortunately, there are many free or very affordable apps on the market. You can find some examples in our blog posts:

• Capacity planning tools
• Project scheduling software
• Leave management system – how to choose

Keep in mind that paying for an app may mean saving money in the long run. Imagine that, thanks to a powerful PM tool, your team saves a couple of hours every week. Multiply that number by your employees’ hourly rates and calculate the return on investment—you might be surprised. One of the companies using Teamdeck estimated that they save ca. $10k every month thanks to switching to a dedicated resource management app—you can read a full case study here.

Looking for alternatives for spreadsheets in project management?

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