Are you already managing your company, or are you still Excelling?

An article by Dr Christian Wurditsch – entrepreneur, investor, business angel

EXCEL – the stone-age axe of cash management

Or: COMMITLY – today’s smart cash flow assistant

Tasks and challenges can be tackled in various ways. In most cases we have a range of options to choose from today. That applies to cash flow management too. There are traditional approaches such as a sheet of A4 paper combined with bank statements and open items lists, or spreadsheets with a jungle of formulas in Excel. Or you take a modern, AI-supported solution such as Commitly.

Which applies to you as an entrepreneur? Traditionalist or pioneer – or something else entirely: simply a doer who wants to manage their company as well as possible and therefore uses the most efficient solution for cash flow management. Since you have plenty of experience with Excel, that application is surely a good option. Really?

To be able to resolve blind spots, you first have to recognise them. Careful, spoiler ahead – Excel dates from the 1990s and, up until the 2000s, was a contemporary tool for liquidity management. That time is over. Why?

Excel as an antiquated time-waster

First, Excel is a program focused on general spreadsheet calculations, not a specialised program for budgeting, cash flow planning and so on.

Second – and this point is far more important – Excel means unnecessary effort. That is clear right from the start, because Excel is not intuitive. When you first use it, it is not obvious how Excel works or what you can do with it straight away. First I have to learn the software in order to understand its basics. The basic functions of Excel first have to be identified, understood and put into practice. Writing in a cell, entering formulas and linking cells require instruction, training and continuous use, otherwise the knowledge is lost. In other words, every Excel user has to learn how to interact with the software in order to do anything sensible with it. That knowledge also has to be passed on to other employees if they are to help with the task.

In summary, one thing is clear: working with Excel requires a great deal of work on your side. Because Excel starts out as an empty worksheet with lots of white cells laid out in rows and columns, and it comes with a vast number of calculation functions, 98% of which the majority of users never use. That means you have to find your way around spreadsheets full of empty cells and an impenetrable jungle of countless calculation functions in order to reach your goal of managing your company’s liquidity optimally. Many people forget this today because they can no longer remember their first steps with Excel. Countless websites with Excel tips for beginners, Excel courses and Excel training bear witness to it.

Today’s intelligent technology

Today we can see that there is another way. Current technologies are so intuitive and supportive that you can access the capabilities and benefits of the service immediately, without having to invest several hours or rounds of training beforehand.

Smart services already come with the solutions built in. Instead of dealing with questions such as “how can I do this or that in Excel to arrive at my cash flow plan?” and with the associated Excel formatting, modern liquidity management tools such as Commitly let you concentrate on the “WHAT”. What are the factors affecting liquidity that you, as an entrepreneur or managing director, can shape better with Commitly?

Commitly makes this possible immediately….

Automated initial data import & data updating

The automated initial data import does more than quickly create your baseline data. The automated data import also helps you keep track of your cash situation day in, day out. All your cash movements are added, and the automatic calculations make sure you are always up to date so that you can manage your company. With updates at the touch of a button, Commitly can work real wonders.

Out-of-the-box calculations

All the essential calculations for liquidity management are carried out automatically. The calculations follow internationally recognised rules and are backed by decades of testing in practice.

AI-supported suggestions for categorisation

All incoming and outgoing payments are assigned to freely definable categories so that you have a better overview and therefore a better basis for management. Commitly lends you a hand here with AI-supported suggestions for categorisation.

Charts and graphics geared to decisions from the outset

Turning essential data visually into charts and graphics aims to (a) allow information to be grasped quickly and (b) provide support when it comes to taking decisions. Charts and graphics are particularly helpful when you have to present the current actual situation or your plans to others such as investors, banks or fellow managing directors. It means a shared picture, and with it a shared understanding, can be reached far faster in discussions.

Permanent automatic forecast

The automatic forecast makes the effects of your daily decisions visible in relation to your goals. Every decision is reflected in your figures, and you do not have to worry about updating or carrying those figures forward. Commitly does that for you as standard.

Managing the company with continuous goal tracking

Knowing how to insert a line break in Excel or display negative values in red should have no bearing on quality and, above all, should be no obstacle to managing your company in cash terms. That is why Commitly does not provide Excel tips, Excel tricks or Excel instructions.

Commitly’s expert tips are direct cash flow management tips, so that you can steer your company along the wave of success more easily. Our most important tip in this regard is: manage your cash flow actively. Good forecasts and building awareness of cash flow in your company will strengthen decision-making processes in every aspect of your business. Because running a company means taking decisions – should I hire another sales employee? Is investing in a second location feasible? How can I keep an eye on how my expenses are developing?

Cash is the lifeblood of your company, which is why it is important to know where you are putting your heart and soul. Take well-founded decisions, regardless of whether your company is on the up or beginning to wobble. To be able to take well-founded decisions, you need up-to-date information, especially about your financial situation. Liquidity management plays an important role in steering your company through the various decisions you have to take. Commitly supports you here as your company’s pulse and blood pressure monitor, right from the first minute.

The comparison of Excel vs Commitly leaves no doubt

As a general spreadsheet program, Excel has served many purposes well and can be used for a great deal. At the same time it is plain to see that Excel is inferior in decisive functions to specialised liquidity planning software and cash flow management services such as Commitly. Admittedly, in the strict sense the comparison is as lopsided as one between a stone-age axe and a laser cutter.

Time saved with Commitly compared with Excel

Compared with liquidity planning or cash flow management using Excel, Commitly saves an average SME more than 60 hours a year. Beyond that, Commitly creates a better basis of information for decisions and therefore more efficient time management for running the company.

Trying something new or letting go of something old takes longer for some and less time for others. With several decades of experience in using Excel, we are familiar with that hurdle.

Credits: Photo by COMMITLY