Excel organizes data for visual analysis and exploration using functions, formulas and arrays. You can build data models, charts and graphs from simple tables. Did you know Excel supports machine learning (ML) and natural language querying (NLQ)?
The platform stays relevant by offering new features and interfacing with many BI (business intelligence) tools. But, is Excel for business intelligence enough or do you need to invest in a BI platform?
Article Roadmap
- Benefits of BI
- Using Excel for Business Intelligence
- Limitations
- Excel Alternatives
- The Future of Excel
- Recommendations for Using or Replacing Excel With BI Tools
- Next Steps
Excel is part of many enterprise tech stacks, and industry experts consider it essential in today’s work environment. Why is that when BI tools are available?
It’s common knowledge how business intelligence supports organizations. Let’s rewind to its benefits and compare how Excel scales with these requirements.
Benefits of BI
Business intelligence is an umbrella term for the tools, technology and techniques for collecting and understanding data. With enterprise reporting, you have a better chance of boosting your bottom line than by relying on experience or hunches.
A competitive industry landscape keeps you on your toes. You must capture a greater market share and outrun the competition. Having accurate, up-to-date data at your fingertips helps make critical decisions.
You can plan to diversify by taking calculated risks with your finger on the pulse of the market. You’ll know when to repackage products and launch new ones.
Using Excel for Business Intelligence
Excel evolved with industry requirements to support performance tracking, accounting and customer intelligence. It relies on many integrations, including Microsoft SharePoint and Power Business Intelligence (Power BI).
Power Query, Power Pivot and Power Maps are part of the Microsoft BI suite, and they query and analyze data stored in Power BI, Excel and BI tools.
Here’s a look at Excel’s BI capabilities.
Drawing Data Into Excel
You can import data into Excel from spreadsheets, SQL Server tables, cubes and Microsoft Azure. You can convey Excel data to Power BI and explore, visualize and analyze it there.
Excel accepts data from any source — you can download information from the internet and copy-paste it from webpages and other sources. Or use direct query to get results from where the data resides.
Exploring Data With Formulas and Functions
Excel’s powerful functions and formulas are its unique selling points. IF, COUNTIFS, SUMIFS, CONCATENATE, VLOOKUP, SORT and FILTER are functions you use routinely. With Flash Fill, you can populate columns after identifying patterns in data.
With Power Pivot, you can view linked data by connecting related tables and feed data models. Excel provides DAX (Data Analysis Expressions) for table linking. MDX (Multi-dimensional Expressions) is its query language for data cubes.
You can pick best-fit charts to visualize the selected data with the Quick Analysis tool.
Visualizing and Analyzing Data
Excel is on par with BI tools in data exploration and manipulation capabilities. It recommends visualizations and allows filtering and highlighting metrics, and provides slicers to analyze data from various perspectives.
Excel offers many chart types for viewing standard industry metrics. Power Maps is a robust module to add location details in 3-D format. It enables plotting more than a million rows of data from Excel tables or models in Bing maps.
Excel macros record and automate workflows to take repetitive tasks off your hands.
Emails and in-app and Windows Action Center notifications alert you when someone updates the data in your files. Excel allows manual data refreshes.
Building Reports and Dashboards
Excel reports and dashboards are available to Microsoft users within Power BI Service and SharePoint. Power Pivot creates dynamic dashboards within Excel. You can expand or collapse timelines and slicers to get the desired views. Data refreshes avoid re-creating reports every time you need the latest information.
Forecast data (in orange) vs. actual data (in blue) using exponential smoothing in Excel. Source
Power BI users have access to Excel data, and the Analyze in Excel feature allows them to derive insights without leaving the Power BI interface. You can transform data using the Power BI interface toolkit or write DAX expressions for them. Report formatting is customizable and you can choose charts and graphs, finally publishing the report to the Power BI Service.
But, Excel suffers from performance issues when it comes to big data and lags in collaboration and data governance.
Limitations
Small projects can grow into big ones, causing speed and performance issues. Big data management needs planning for file classification, and user and access management.
- Performance and Scalability Issues: Excel is slow when it comes to handling big data. It isn’t meant for speed but rather for managing rows and columns of information. Automated data refreshes aren’t available.
Excel doesn’t allow more than a million rows in a sheet. A possible workaround is to open a large file using Power Query. The complete file opens, but it displays only the permitted rows and columns.
- Limited Collaboration and Sharing: Excel offers live co-authoring, but it’s not pretty. You must wait if someone is editing a shared workbook, and there’s no way of knowing when it will become available. Excel doesn’t check often. The wait becomes longer if someone else starts editing by the time you come back to check.
Excel Online doesn’t give you a free hand, either. You can’t create a table or delete cells in a shared workbook. Splitting it into separate workbooks for different users requires their interlinking.
- Issues With Linked Workbooks: Excel saves workbook links in its own way, and these might break. It doesn’t update the linked data everywhere so you’ll need to open each one in the correct sequence, depending on the linking.
AutoSave is a definite Excel perk but the overhead of saving workbooks every few seconds can add up. It might impact performance when dealing with large data volumes.
- Data Validation Issues: Excel accepts whatever you type. Setting validations is easy but maintaining them is difficult and often they don’t work. It permits manual entry and updates, which puts data integrity at risk.
- Limited Security and Data Governance: Spreadsheet data is prone to errors and tampering. Excel allows restricting document access with file encryption, passwords and digital signatures, but the governance protocols leave much to be desired.
Reusable workflows aren’t built-in, but you can create macros or use Power Automate or Robotic Process Automation (RPA). Links can break and impact connected workbooks.
Excel Alternatives
Using Excel as a business intelligence tool means going beyond its spreadsheet capabilities. It’s here that Excel falters and lags behind modern software. We discuss five BI tools that pose stiff competition to Excel in functionality.
Microsoft Power BI
It’s Microsoft’s product suite for business intelligence support to Excel. Power BI is scalable and easy to use with more than 100 data connectors. It draws data from SAP HANA, Hadoop, Google BiqQuery and Google Analytics.
A map visual with bubbles representing the relative profit of each location. Source
Power BI offers a text-based search option for data exploration. You can run R scripts in Power Query to create custom visuals and predictive models. Scheduled data refreshes are available.
Limitations
- It doesn’t allow filtering or slicing on dashboards.
- It doesn’t provide a versioning system for reports.
Sisense
It’s an API-first end-to-end data platform with R, SQL and natural language processing. Sisense supports Live Connect queries in SQL Server, Amazon Redshift, Oracle and MySQL. A native mobile app is available.
Create custom dashboards for your industry verticals in Sisense. Source
Machine learning algorithms track KPIs (key performance indicators) and issue alerts when data exceeds preset threshold values. The platform’s database, ElastiCube, handles large workloads for big data analytics. Sisense has similar capabilities as Power BI and integrates with Microsoft 365.
Limitations
- Live connections do not support R formulas, mode and standard deviation.
- The learning curve to create Elasticubes is quite steep.
Solver BI360
It’s an enterprise performance management (EPM) tool for budgeting and financial forecasting. It connects to many leading enterprise resource planning (ERP) systems. The platform generates balance sheets and month-end close and consolidations. Scheduled report sharing and version control are available.
A Payroll Forecast Assumption Form automates salary and tax calculations. Source
Solver draws data from Power BI, Microsoft Dynamics, SAP, NetSuite and many databases. Its report writer provides layouts and reporting formats on a browser-based web portal.
Limitations
- Doesn’t offer a mobile app.
- Doesn’t offer a free trial.
Clear Analytics
It enables analyzing big data files with more than a million rows in Excel. Its query engine embeds within Excel, maintaining optimum performance by handling unlimited requests in parallel. You can drag and drop datasets, filter and combine them to create spreadsheets in Excel.
Clear Analytics embeds a query builder within Excel. Source
Compare two query results and datasets before analysis with its reconciliation engine.The platform can handle an unlimited number of users at the same time. You can use shared data without impacting underlying databases.
A data profiler checks quality, while a scheduler distributes reports per a timeline.
Limitations
- Doesn’t offer mobile apps.
- Doesn’t allow report sharing without Power BI integration.
- Not available on Linux and Mac.
- Doesn’t provide predictive analysis and forecasting.
Zoho Analytics
It’s a BI tool with robust big data integration, embedded analytics and forecasting. Its free plan addresses lighter reporting needs, providing two users, five workspaces and 10,000 rows per account. You can format reports as desired and even access the underlying data.
Zoho Analytics allows team collaboration for shared insight. Source
The tool offers custom drill-down paths, highlighting, sorting, filtering and mouseover effects. You can predict business patterns and share insights by embedding live data views into websites and business applications.
Limitations
- Doesn’t have a flat learning curve.
- Doesn’t provide unlimited queries and joining.
- Doesn’t have an organized interface.
The Future of Excel
Code changes and integrations help Excel keep up with the times. Excel add-ins for BI tools allow you to extend functionality beyond your ecosystem.
But, all Excel features don’t work when you export its data to other platforms. Changing calculated measures and fields in Power BI can cause needless complexity.
So, should you use Excel or BI tools?
Excel was never designed to be a database and to pull data from a wide range of sources. It’s great as a presentation tool, but not for data munging and complex calculations. Additionally, it lacks a single source of truth, automatic data refreshes and built-in advanced analytics.
These issues push users to look for alternatives to Excel for business intelligence.
Recommendations for Using or Replacing Excel With BI Tools
Excel is perfect for creating tabular reports and its functions enable complex analysis. If you’re a Microsoft user, you already have Excel with the robust support of Power BI and SharePoint.
But it lags in big data management and collaboration. Get a BI platform if you can afford it — only Excel won’t suffice for your big data needs, especially if you’re a medium or large enterprise.
Modern BI tools have built-in functionality — in-memory processing, scalability, automation and advanced analytics. It puts them ahead of Excel, doing away with the need for external integrations.
Next Steps
If you want to buy a BI platform, start by assessing your organization’s requirements. Check out our requirements template to create your own list. Or compare leading BI tools against your requirements through our vendor comparison matrix.
Go through our nine-step Lean Selection Methodology to learn about software selection.
How has Excel made a difference to your business? Which alternatives do you use instead of Excel for business intelligence and analytics? Feel free to share in the comments.
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