These days, we’re lucky to have so much data at our fingertips. We have a spreadsheet that gives us the number of closings by builder and another one that tells how much lumber is being cut in the forests of Canada. We build one spreadsheet to keep up with our sales people, and we input data into another to determine a particular customer’s value—or lack of value. All this information has helped us move our business faster and further than at any time in history.
Yes, all these spreadsheets are great tools to make our business life flow smoother while boosting profit and productivity to the point where we can take on more and more business and raise our business to another level.
Or have they?
Could it be we’re managing our business and our companies by nothing but spreadsheets today? Have we lost the personal touch that has made most companies great? Have we lost what at one time was what made a great manager or sales person--someone who knew his employees better than his own family and knows the customer’s next move before he makes it? Are we using these spreadsheets as a crutch instead of the tool they were meant to be?
I believe that’s the case.
The business world has been moving at such a fast pace that I would argue we have lost what has been the mainstay for businesses in this country to be great. We are not using the spreadsheet as the tool for which it was designed, but rather as the gospel for us in the business world to make soul decisions.
Companies use only the numbers and some words on a spreadsheet to make multi-million dollar deals every day. Then they find out later that the people they were making the decisions for weren’t on board with the decision. Or perhaps the people in the field didn’t realize that the only tool used for the decision was a spreadsheet that omitted vital information because some auditor somewhere filtered out what was regarded as irrelevant.
We have to be careful how much information and what type of decision-making power we are affording these spreadsheets. A spreadsheet is just one tool in our tool bag to make decisions. It is not the only tool. Boots on the ground and communicating with people are still proven commodities to make decisions, especially the big ones that affect your employees and your customers. Don’t underestimate the people on the front lines who are the face of your business.
Wall Street today uses information from massive spreadsheets to determine how a company is moving along, how a company is trending, how much money it made this quarter, and where that business is heading. However, the savviest business people still use their boots on the ground to decide which company to invest in and where to spend their money.
Warren Buffett, one of the shrewdest investors of our time, once said: “Understand the value of data and put it in its place along with all the other things communicated to you to make the best decision at the time.” What he is saying is that a spreadsheet is just one tool and not the only tool.
Remember the relationships that you have with your employees and especially your customers are more valuable than any spreadsheet could be. Stay in front of your customers; understand their needs on a one-on-one basis. Learn what you can about the people you do business with. This information you glean from these face-to-face meetings will give meaning to the information that the spreadsheet gave you. Understanding the business opportunity from a combination of spreadsheet information and one-on-one meetings makes for a better and more well-rounded decision going forward.
Great managers understand the value of knowing their customer, be it through internal or external sources. Understand the value of relationship in the decision-making process. Know your spreadsheet, but know your customer better.