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99-Spreadsheet modeling, Excel resources

The Excel Trap

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Vlookups, macros, formulas, cells, tables, all words used to describe a function people utilize Excel to complete a task. A quick Google search for anything related to excel will return countless forums, message boards, tutorials and other methods to learn whatever challenge you are having in the excel space. The knowledge and power to utilize Excel as a business tool is readily available. The biggest mistake people make is forgetting that Excel is just another tool, not a cure all. Sadly, once a “template” for an excel model is created, people assume the accuracy of the cells and forget to look at the data for accuracy. In many cases this problem may not cause any serious ramifications; however, as seen from Tim Worstall’s Forbes article, “Microsoft’s Excel Might be the Most Dangerous Software on the Planet”, there are situations where people were depending on excel for billion dollar deals with the wrong formula calculation.

As important as it is to understand the reasons to use excel, it is just as important to know reasons not to use excel.  Ramon Ray in “Another Reason Not To Use Excel” writes, “Many of you, I do it too, use Excel for so many things as it’s so easy to use. You just open it and begin typing. However, as your data needs expands, it’s important to use a tool that’s built for your needs. An accounting program for bookkeeping; a database for inventory; and a contact management tool for keeping track of contents. I could go on.” All too often Excel is relied upon for various business needs in places where it probably shouldn’t be there. It’s important to understand the capabilities of Excel in order to make critical decisions as to the benefit of utilizing it. Knowing the limitations can make the analysis quicker as well as ensure falling for an Excel trap.

While its users easily identify the benefits of Excel, the dangers are not so easily understood. Without having a proper spreadsheeting software, the financial institution as a whole would not be what they are today. Many of the derivate securities that are sold on the market on a daily basis are modeled using Excel or something very similar. In Worstall’s article, he mentions “That very throwing of trillions a day around the markets (and it really is trillions a day: the foreign exchange market in London alone is over $2 trillion a day) is dependent upon the existence of Excel itself.” Without excel, the models necessary to perform these transactions would be impossible; but just like anything else, if you put garbage in, you’re going to get garbage out. Unfortunately, once a model is created, it is taken as a fact, rather than as a resource to determine the right answer. This faith in Excel can lead to serious issues which is why it is important to review and refine models as more information becomes readily available. The next time you turn to Excel to solve a problem with a any sort of business model, be sure to remember that it’s just another tool in your tool belt, a powerful tool, but a tool nonetheless.

07a-Crafting an effective formal presentation, 07d-Delivering a presentation, clearing slides, questions, slide-craft, Uncategorized

Most people give bad speeches. But most people can give good speeches

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“Most people give bad speeches. But most people can give good speeches.” These are within the closing statements of Megan Mcardle’s article, “The Fine Art of a Proper Powerpoint”. Throughout our lives, we’ve had to listen to countless presentations and have probably had to give a few ourselves. Among these, there are those that captured our attention while others have lulled us to sleep with no recollection of what the subject of the presentation was. There are plenty of resources online to help guide what a proper presentation should look like, but I don’t intend to bore you with that. Miss Mcardle makes several good points in her article, which I will touch on, but I’ll also describe what experience has taught works best.

The number one mistake that most people can identify as a guaranteed sleeper presentation is when the presenter puts all the material on the slides and then proceeds to read what the audience is looking at. As Ms. Mcardle puts it, “Listening to people read from their notes or their slides is considerably less interesting than listening to a five-year-old read from “My Pet Goat”–at least the five-year old is really trying.” As a presenter, it’s important to remember that you are meant to be the subject matter expert on what you’re presenting, otherwise, why are you the presenter? Being the most knowledgeable on a topic doesn’t come easy, but that’s why you’re given time in advance to prepare (for the most part anyway). In your slide craft, it’s important to know what information the audience needs to visually see versus what they should expect to hear from you. With that in mind, you can begin to prepare your slides.

Avoiding the “reading” method of presentation will help reduce the overall word count that is placed on each slide. It forces you to take on the role of the educator with the material, rather than the messenger. Slide craft focuses on ensuring enough material, mixed with white space, appropriate graphics and visuals, and proper takeaways are present from each slide. Slides with a purpose are the only ones that should fill a presentation. Crafting the look of the slides is often the easiest part, the content chosen needs to be meticulously determined by understanding who the audience is and catering the content specifically for their position. Not all gaps have to be filled within the slide, there’s a Q&A session for a reason. No presentation, however, can ever account for content not prepared for; therefore, the most important part of the presentation is the pre-work of the material you’re presenting on (recall the Delta presentations, without the work we put in before, we would’ve had no material to present).

At this point, the slides are mostly ready and the delivery practice begins. When delivering, remember that you know the content of the presentation and you’re explaining to, expanding on, and educating with the material to the audience. This requires audience engagement. The #1 way to be sure that they’re engaged is to look at them. Eye contact helps not only engage the audience, but it also lets you know when you’re beginning to lose the audience. This awareness helps you change your presentation on the fly. Since you’re familiar with the material, you can determine if you need to expand further on the slide, move on, or ask a pertinent question to determine overall audience engagement. Knowing the material and being passionate about what you’re delivering help this type of presentation style. If you are excited about your subject, the audience will feed off this energy and remain engaged more easily. There are many more nuances to presentation delivery, and the best way to improve is to just give more presentations, which will help you find the style that works best for you. Plenty of resources are available online but if you can keep the presentation clean and focus on the audience, you’re well on your way. Besides, “The slides, after all, have probably already heard this talk before.”