CFO Guide to AI and Excel

With a whopping 750 million users globally, Microsoft Excel has been the go-to traditional tool for data presentation and analysis. But, as we head into 2024, the buzz is all about artificial intelligence (AI) and how it’s set to shake up human-computer interactions.

The AI wave ushers in a fresh era, where CFOs and business leaders are diving into AI tools to use with Excel-like generative AI, ChatGPT, and Microsoft Copilots to amp up their business game. It’s prime time to hop on the AI train, embrace the advantages of AI, and gain a deeper understanding of it to manage and analyze data more efficiently.

Notably, 63% of advanced Excel users have utilized at least one AI tool with Excel, and within the 41% of Excel users who realize they can incorporate AI into Excel, over half (58%) have used it with ChatGPT and one-third (38%) have employed Excel’s built-in AI tools.

Spreadsheet Security Flaws

Data is at risk, especially when companies share financial info like projections and records through email attachments. Mistakes happen – like sending to the wrong person – and that can cause big problems.

Moreover, sensitive information can intentionally fall into the wrong hands, whether by accident or on purpose. Research indicates that up to 90% of spreadsheets contain errors. From simple copy-paste blunders to complex miscalculations, Excel errors are common. Chances are, you’ve come across one at some point!

AI in Revolutionizing Spreadsheet Functionality

With the rise of AI and machine learning (ML), it’s interesting to think about how these technologies could change spreadsheets. Big software companies like Microsoft are pretty excited about this idea. Microsoft has made a big investment in OpenAI, the company behind ChatGPT, and has already added AI features to Excel and other tools. Google Sheets also has some cool AI integrations, like suggesting formulas and making data visualizations with a click. But, the big question is: will AI really shake things up and transform how we use spreadsheets?

AI-powered features have a lot of potential to make things smoother. For instance, in financial analysis, AI could help with organizing data and suggesting the next steps in modeling. But, it’s kind of like when an online store suggests books based on what you’ve bought before. Picture this: asking a spreadsheet to create a financial model for an energy start-up using AI. Even if AI can grasp complex business situations, it still needs human insight to make a perfect model.

People who handle spreadsheets say that tasks like modeling and analyzing data mix art and science. Even the smartest AI algorithms need a ton of details, like company size and product specifics, to create an accurate financial model.

Future-proofing Spreadsheets with Automation and Advanced AI Integration

There is an alternative way to enhance standard spreadsheets. Automation, without the use of AI, can propose the most common options a trained professional would consider. This still requires interaction with a chatbot that asks contextual questions based on previous answers. However, it reduces the probability of errors by delegating the task of writing spreadsheet formulas to a machine based on human-provided answers.

On the other hand, AI can detect anomalies and warn of potential mistakes. When problems can be addressed with imperative algorithms, they prove to be better and faster than AI. AI is more suitable for solving problems that cannot be deterministically instructed to machines. For most businesses, AI can assist with workflow by suggesting appropriate permission levels based on past actions.

Ultimately, could AI in spreadsheets help businesses make better decisions? Certainly, but only when we train AI to reach human-level understanding, ethics, business acumen, and awareness, or when AI can train itself—at which point, we might find spreadsheets less fascinating.

Enduring Excel Relevance in an AI-Driven World

With the proliferation of AI programs generating financial models and analytics, why does Excel continue to flourish in the AI era?

Despite the rapid advancements in AI, Excel remains a crucial tool in the business world for many reasons. Its capabilities in modeling complex data, automating workflows, and visualizing information through charts, pivot tables, and dashboards enable users to customize the software for a wide range of tasks, from budgeting to inventory management. This versatility ensures its relevance across various roles and industries.

There are several key reasons how and why Excel continues to thrive even with AI programs :

Adaptability

Excel’s adaptability is unmatched. It can handle complex data modeling, automate workflows, generate charts, create pivot tables, develop dashboards, and much more. Users can tailor it to meet virtually any spreadsheet need, from budgeting to inventory management. This versatility is invaluable across a wide range of roles and industries.

Ease and Accessibility

As one of the most widely used business software programs, Excel has a very low learning curve. Millions of people around the world are already proficient in Excel. It is a staple in office environments. This widespread familiarity makes it easier to enhance Excel skills than to learn newer, niche tools.

Excel is available on Windows, macOS, iOS, and even Linux-based systems like Android. It is offered in web, desktop, and mobile versions as part of Microsoft 365. This cross-platform availability ensures that Excel remains accessible to everyone, whereas AI tools often require the latest OS, hardware, or high-speed internet.

Seamless Integration

Excel comes with built-in charts, formulas, pivot tables, security features, and access to other Office apps like Word and PowerPoint. This seamless integration saves time compared to assembling separate, standalone tools. Additionally, the ability to import, export, and work with data from databases and other sources further enhances its value.

Advanced Arsenal

Years of development have endowed Excel with advanced features. Sophisticated functions such as LINEST for linear regression, new chart types, Power Query for data modeling, and collaboration via Co-Authoring solidify Excel’s status as the leading spreadsheet tool.

Maximizing Value

For individuals and smaller businesses, the relatively low licensing cost of Excel as part of Office 365 subscriptions enhances its appeal compared to expensive proprietary data tools. The capability to share files organization-wide also minimizes redundancy.

Looking to Excel in Excel?

For both seasoned professionals such as CFOs and newcomers, there are numerous resources to enhance your Excel proficiency:

  • Microsoft provides free official tutorials that cover everything from beginner to advanced Excel skills, including formulas, pivot tables, visualizations, business tools, power queries, and more.
  • LinkedIn Learning offers a wide selection of Excel video courses focused on analytics, dashboards, automation, and other functionalities. Their concise tutorials make learning straightforward.
  • Udemy boasts thousands of affordable Excel courses on specialized topics such as VBA macros, Power BI integration, shortcuts, and more.
  • YouTube hosts a plethora of free tutorials from experts, which are ideal for understanding concepts through live demonstrations.
  • Numerous Excel training books, filled with tips and practice files, are available on Amazon and other retail outlets, providing well-structured learning opportunities.
  • Colleagues who are proficient Excel users can be invaluable resources for tips and templates. Hands-on coaching from experienced peers can significantly speed up your learning process.

With the continuous advancements in Excel and its integration with cutting-edge AI, enhancing your skills will be beneficial throughout your career.

Excel’s AI Arsenal

AI operates on the concept that human intelligence can be codified in a manner that a machine can replicate it and carry out tasks, ranging from simple to highly intricate. In Excel, we often perform routine and repetitive tasks, like opening files from specific locations, cleaning data, and updating reports. AI can assist in these scenarios, utilizing features like Power Query in Excel. 

Another useful feature is Analyze Data, which accelerates the extraction of information from data. Excel incorporates several AI-like features that employ machine learning algorithms to automate tasks and natural language processing to fetch relevant web information based on the data selected. However, it does not implement more advanced AI techniques.

Some built-in tools in Excel leverage AI-like capabilities to enhance functionality. Here are some examples:

  • Data Cleaning – Power Query helps identify and rectify errors, outliers, missing values, duplicates, and inconsistencies in your data.
  • Data Extraction – This involves converting data from one format to another. AI assists Excel users in extracting data from sources such as images, PDFs, or web pages. For instance, the “Insert Data from Picture” feature allows you to convert an image of a printed data table into an editable spreadsheet. Additionally, AI can import data from web pages using the “Get Data from Web” feature in Power Query for Excel.
  • Idea Generation – Excel can analyze your data to generate insights and suggestions. By using the “Analyze Data” feature, you can ask questions, create charts, or discover trends and patterns. For example, with a sales data table, Excel can show best-selling products, average monthly revenue, or the correlation between price and quantity.
  • Predictive Modeling – Predictive modeling is a common use of AI in Excel, enabling users to forecast future outcomes based on historical data and trends. For example, AI can be used to predict sales, revenue, customer churn, or inventory levels. Features such as “Forecast Sheet” and “Data Analysis Toolpak” facilitate the creation of predictive models.

Final Thoughts

While AI is undeniably transforming many aspects of spreadsheet functionality, enhancing both efficiency and accuracy, the enduring relevance of Excel cannot be understated. Balancing the precision of automation with the adaptability and user familiarity of Excel creates a powerful synergy for data analysis and business operations. As we continue to integrate advanced AI tools with traditional software like Excel, professionals are uniquely positioned to leverage the best of both worlds, ensuring robust and insightful data management for years to come.

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