Production planning in Excel - advantages and disadvantages

Spreadsheets have been used for decades to solve many business management tasks. Due to their wide availability, they are used in many manufacturing enterprises, in particular in production planning departments. What are the advantages and disadvantages of using spreadsheets for production planning? What are the alternatives?

Production planning in spreadsheets - advantages

Excel and other spreadsheets have been used for production planning for over 40 years. There are many low-cost or free Excel templates available on the internet, such as a production planning template that includes a master production schedule (MPS), inventory management, or project management sheets. You can also find step-by-step instructions online on how to create such templates yourself. What other features of spreadsheets make them so popular in production planning departments?

Accessibility

The most important reason why companies turn to spreadsheets so often is their accessibility. Microsoft Excel or Google Spreadsheets are relatively low cost for companies. There are also completely free spreadsheets available online as part of applications such as OpenOffice or LibreOffice.

Quick learning curve

Another aspect of the popularity of spreadsheets is the ease with which most people can get started with them. The vast majority of production planners already have some experience with spreadsheets. As a result, new hires can get up to speed faster and there is less time and money spent on training.

Support materials are widely available

Because spreadsheets are one of the most widely used programs in the world, there is a huge amount of support material available online. From user guides provided by developers to entire forums and groups dedicated to the topic.

Collaboration with other systems

Data from Excel or Google Sheets integrates well with other systems, such as accounting software or e-commerce platforms. This makes it much easier to transfer data from one system to another. Thus, users can transfer information from a spreadsheet (usually by creating a CSV file) or take information from third-party software and transfer it to a spreadsheet. This allows users, for example, to create customized reports or charts that are not available in other software.

Working in the cloud

In the past, one of the disadvantages of spreadsheets was that changes made to the spreadsheets were not automatically made available to all users. After making changes, the spreadsheet had to be emailed to the next user so they could see the changes and add their own. Today, solutions such as Google Sheets or Microsoft 365 offer access to spreadsheets in the cloud, making them available to multiple users at the same time.

Good for micro businesses

Although spreadsheets are no longer the only option available for business management, they still work well in a microbusiness environment, i.e., companies with 1 to 10 employees. Workflows in such companies are usually much less intensive and complex.

Planning in spreadsheets - disadvantages

Despite its advantages, production planning using spreadsheets has certain disadvantages and inconveniences. The most important ones include

Risk of human error

Manual data entry, which often occurs when using spreadsheets, is prone to human error. Studies conducted in academic centers have shown that the risk of error is closely related to the size of the spreadsheet (number of rows). When a large amount of data is entered into the system, which often happens in production planning, errors (even minor ones) can lead to serious consequences in production.

Data entry is time-consuming

In the case of spreadsheets, the need to enter large amounts of data is time-consuming. If you translate this into man-hours, then spreadsheets lose one of the most important arguments in favor of their use - low price.

Low scalability

As the complexity and volume of data increases, spreadsheets become less intuitive and ergonomic. The low level of user experience leads to a growing reluctance of staff to work with the application. Spreadsheets also do not provide the level of process automation that is needed to manage large production structures.

Advanced features require extensive training

The basics of working with spreadsheets can be learned in a few days. However, mastering the most advanced features, such as VBA (Visual Basic for Applications) programming, requires tens or hundreds of hours of training.

Offline version makes collaboration difficult

If a company is still using spreadsheets in the traditional way, i.e., storing files on a computer and exchanging them via email, it is difficult to create an effective workflow. One in which information is instantly available to all participants. Since production planning is a collaborative process that often requires more people to be involved and have access to information, this can be a serious obstacle.

An alternative to spreadsheets

The disadvantages associated with the use of spreadsheets in production planning have given rise to the development of software designed for this purpose. We are talking about computerized systems of the APS (Advanced Planning and Scheduling) class. They allow you to create highly optimized production plans in a very short time. The QGUAR APS PRO system allows you to plan operations for several products and jobs simultaneously. The created schedule is visualized using an interactive Gantt chart. An authorized user can adjust it by drag and drop if necessary.

Unlike spreadsheets, well-built APS systems are also intuitive and easy to navigate. They automate a huge portion of data entry tasks, reducing the risk of human error. APS systems are now available on a subscription basis. By spreading payments over time, there is no need for large one-time costs with an amortization period of several years.