Spreadsheet Overload?

Computerworld - In the beginning, there was VisiCalc, the first killer app for the PC. Lotus 1-2-3 subsequently took over, before yielding the throne to Microsoft Corp.'s Excel. Today, spreadsheets are so easy to use and ubiquitous that they've sprouted like weeds throughout most companies. And they often hold important financial data.
But what if Mary's sales spreadsheet differs from Tom's and has faulty data or a modeling error? What if Tom hoards his spreadsheet data -- it's a form of power, after all -- and won't let go? How do you get the data from dozens of far-flung spreadsheets into a companywide planning or budgeting system that meets the latest accounting standards?
Various studies report that 47% to 64% of companies use stand-alone spreadsheets for planning and budgeting, for example. But critics say spreadsheets -- invented as a personal productivity tool -- aren't well suited to collaboration, data quality or regulatory compliance. "Excel is a tool of information mavericks," says Eleanor Taylor, manager of business intelligence strategy at software vendor SAS Institute Inc. in Cary, N.C.
"Besides being extremely unwieldy for processes involving large volumes of data and multiple users, spreadsheets often contain substantial, material errors, according to academic research," wrote Paul Hamerman, a Forrester Research Inc. analyst, in a report last year.
Companies are just starting to look at the problems caused by spreadsheet proliferation, says Gartner Inc. analyst Michael Silver. "Some enterprises are addressing it, but most aren't," he says.
No one is suggesting that the spreadsheet is going away anytime soon or that it's a top-of-mind IT issue. "The subject is certainly of interest and has potential for improvement, but in the scheme of things, it's not high on the list of priorities," says Joe Iannello, CIO at watchmaker Movado Group Inc. in Paramus, N.J.
What's the Problem?
Questioning the desirability of spreadsheets, after their widespread acceptance over the past two decades, is almost like questioning mom and apple pie. But for a modern corporation looking for consolidated planning and financial reporting, spreadsheets pose challenges not dreamed of when they first began popping up on PCs across the land.
Here are three of the more significant spreadsheet issues that companies have to address:

Decentralization. Mentor Graphics Corp. in Wilsonville, Ore., had a central 25MB Excel spreadsheet and 1,200 budget spreadsheets across the enterprise, one for every cost center. But having numerous spreadsheets makes it difficult to collect important data. "Spreadsheets are great analysis tools, but at some point you start using them as a planning system, and