How Electronic Spreadsheets Changed the World

Abstract

In How the Irish Saved Civilization, Tom Cahill contended that during the dark ages the monks were responsible not only for writing and preserving the Bible but for other great works, including mathematics texts [Cahill, T. 1995. How the Irish Saved Civilization: From the Fall of Rome to the Rise of Medieval Europe. Doubleday, New York]. In much the same way, we have seen that electronic spreadsheets have changed (although perhaps not saved) our world in the last 25 years. The first author, who has over 40 years of experience in teaching quantitative analysis (management science, operations research, decision sciences, and statistics) at eight US universities, has been using spreadsheets for over 20 years. The second author, with almost 15 years of spreadsheet experience, witnessed the exponential growth of personal computers and their associated programs starting in her college days in the mid-1980s. While she majored in computer science, the emphasis was on programming. However, many who were in school at that time realized that the growth area would be in programs, not in programming; therefore, they spent their time using Mac computers and learning word processing and spreadsheets. When the second author returned to school for her master's in science, she observed a love/hate relationship with spreadsheets in the multiple fields of science in which she worked. In this paper, we offer our personal perspective on this ubiquitous and useful tool that has unquestionably changed the world. [PUBLICATION ABSTRACT]

Headnote

In How the Irish Saved Civilization, Tom Cahill contended that during the dark ages the monks were responsible not only for writing and preserving the Bible but for other great works, including mathematics texts [Cahill, T. 1995. How the Irish Saved Civilization: From the Fall of Rome to the Rise of Medieval Europe. Doubleday, New York]. In much the same way, we have seen that electronic spreadsheets have changed (although perhaps not saved) our world in the last 25 years. The first author, who has over 40 years of experience in teaching quantitative analysis (management science, operations research, decision sciences, and statistics) at eight US universities, has been using spreadsheets for over 20 years. The second author, with almost 15 years of spreadsheet experience, witnessed the exponential growth of personal computers and their associated programs starting in her college days in the mid-1980s. While she majored in computer science, the emphasis was on programming. However, many who were in school at that time realized that the growth area would be in programs, not in programming; therefore, they spent their time using Mac computers and learning word processing and spreadsheets. When the second author returned to school for her master's in science, she observed a love/hate relationship with spreadsheets in the multiple fields of science in which she worked. In this paper, we offer our personal perspective on this ubiquitous and useful tool that has unquestionably changed the world.

Key words: electronic spreadsheet; Excel; Lotus 1-2-3; Multiplan; VisiCalc; personal computer (PC); computer programs; management science; statistics; graphing; graphics.

History: This paper was refereed. Published online in Articles in Advance February 18, 2009.

Personal Computers

In his senior year in college in the spring of 1962, the first author took a FORTRAN course on the IBM 650 (with its vacuum tubes, plug boards, and punched cards) and subsequently learned BASIC, COBOL, PL/1, APL, and many additional languages. Then, the objective was to use computers as a means to an end-to solve problems. Richard Hamming, in his 1962 book on numerical analysis, said that the importance of computing is insight, not numbers (Hamming 1962). After 20 years of teaching programming, calculus, statistics, and decision sciences in engineering and business schools, the first author saw the personal computer (PC) come on the market. In 1982, he bought his first IBM PC at Computerland in White Plains, New York, in the shadow of IBM's Armonk headquarters; he viewed it as a mainframe on his desk, which he could use to program in BASIC. He was still in the mainframe mindset; thus, he did not realize the coming revolution that would change his profession of teaching management science (MS) from teaching mathematics appreciation and programming to teaching modeling and analysis.

Electronic Spreadsheets

How Electronic Spreadsheets Changed PCs

In the late 1970s and early 1980s, Wang dominated the word processing market with dedicated word processing machines that transformed secretarial work. Today, we have barely reached some of Wang's word processing capabilities. However, it was VisiCalc (in approximately 1981) and the development of electronic spreadsheets that advanced PC sales beyond word processing machines and changed the definition of secretary (eliminating much of the work that secretaries had done) to administrative assistant.Wang redefined the secretary's job; however, with their word processing and spreadsheet capabilities, PCs redefined the secretary.

PCs were originally designed as machines for hobbyists and programmers. With the inclusion of spreadsheets, the PC became more than just a programming machine or low-level word processor; it also allowed the user to see calculations and "see" into the computer-i.e., use input devices, such as computer terminals or monitors. We contend that without the electronic spreadsheet, PCs might have remained hobby tools or game machines. Wang, in a fruitless attempt to save the company, began producing PCs with a less-functional version of its word processor; however, it could not staunch the tide of IBM PCs and PC-compatible machines running VisiCalc. Businesses switched quickly from word processors to PCs because they saw the PC as a multifunctional machine that was no longer for secretarial use only. In their review of 25 years of spreadsheets in education, Baker and Sugden (2003) state that spreadsheets infused the PC with real value in the market.

The addition of terminals (first teletypes and later CRT screens) to mainframe computers allowed users to quickly enter programs and data into computers, and to see the results displayed on the screen immediately. Word processers and PCs, the next steps in the computer evolution, showed the written word in much the same way the monks had used writing to preserve human thought and history. However, the electronic spreadsheet provided the real breakthrough by allowing programming and results to be shown on the PC screen in a spatial, visual way that nonprogrammers could view and understand. There was no need for a compiler-results were immediate. So it is with tongue-in-cheek that we titled this paper to show how PCs and spreadsheets have saved the world from an elitist, secret, linear, arcane way of thinking (computing) "behind closed doors" to an open, commonsense, real-time, spatial way of looking at calculations. Programming (computing) required the addition of documentation (usually in the form of comments in the code) to allow other programmers to understand the programs. The documentation was built into spreadsheets. In addition, the spreadsheet platform allowed for a collaborative learning approach because spreadsheet templates were developed and shared within and across companies; this contrasts with the traditional, individualistic approach to computer programming. It also allowed users to design their own layouts using a few simple rules; thus, they became rule makers (Baker and Sugden 2003); this required companies to institute spreadsheet template policies.

How Electronic Spreadsheets Changed the Teaching of Programming

In 1984, the first author was tasked with teaching word processing, BASIC, and these new spreadsheets to MBAs at Wake Forest University. When he began to teach the last part of the curriculum, it became obvious to him that all the BASIC programming examples could be done in a much simpler fashion by using spreadsheets; in addition, his students seemed to have an intuitive sense of the process. He recommended eliminating BASIC from the curriculum, and the faculty followed this recommendation. Thus, teaching students to use spreadsheets, rather than writing computer programs, became the first breakthrough. Spreadsheets emulated how people laid out work. Their use of labels for different areas within the spreadsheet for data, calculations, tables, and graphs made them easy to reference and understand. When users entered data or formulas, spreadsheets provided instant computations and a "what you see is what you get" (WYSWIG) look. By changing data or using data tables and lookup functions, users could quickly perform "what if" analysis; they did not need to compile and rerun programs. This differed greatly from the early versions of dBase in which the user could not see or manipulate anything-there was only a blinking dot on a blank screen. For a long time, statistical programs, such as SPSS and SAS, continued to maintain the mainframe mindset, rather than adopting a spatially oriented interface.

Spreadsheets display rows and columns using numbers and/or letters. Using numbers required offset numbers for formulas, and even using range names with Lotus became cumbersome; using letters allowed the use of simpler cell references rather than formulas with many range names (Figure 1).

Thus, the formula for Profit could be written three different ways:

(1) Original Multiplan: R[2]C[1]=RC[1]-RC[2],

(2) Range names: Profit=Revenue-Cost,

(3) Lotus 1-2-3: A2=B2-C2.

When Lotus 1-2-3 came on the market in 1983, cell references were simplified back to VisiCalc's use of numbers and letters (method number 3). It quickly became evident to the first author that extensive use of range names (method number 2) could degenerate into the use of COBOL-type language with lengthy formulas and lists of names for cells; this would obfuscate even the simplest of spreadsheet calculations. Lotus 1-2-3 changed columns back to letters, thus keeping spreadsheets from taking the traditional programming path. In addition, the use of a "$" sign allowed the user to fix rows and/or columns to aid in copying a single formula to multiple places on the spreadsheet without having to rewrite the formula. In addition, spreadsheets were expanded to include numerous mathematical, statistical, and financial functions that replaced the programming subroutines.

When the first author taught at Mercer Engineering School in the 1990s, undergraduates participated in internships for a few quarters following their junior year. By that time, they had learned spreadsheets, C++ or Pascal, AutoCAD, and even thermodynamics. Consistently, these interns reported that their most frequently used skill was designing simple spreadsheets for their departments and managers. They were hailed as heroes for having the ability to do something that they thought was fairly elementary, and had even treated with disdain. After the first author moved to Pepperdine in 1997, one of his students in the MBA program for fully employed students used the spreadsheet to validate his sixth-order regression calculations to remove ambient light coming from the Spitzer telescope that was mapping the stars-although the student had a PhD in astrophysics, worked at JPL (Jet Propulsion Lab), and had programmed in Perl.

Unfortunately, universities made some false assumptions when spreadsheets replaced programming in the graduate curriculum. One was that students would know that the order of operations in computers was the same as the order in algebra; thus, they would know that a + b/c is not the same as a + b-/c. Unfortunately, this was not always the case, because many students had not learned programming as undergraduates. Therefore, they did not understand this important concept.

How Electronic Spreadsheets Changed Graphics

The second spreadsheet breakthrough was that Lotus 1-2-3 allowed the user to graph the data and results, including a plethora of visuals-pie charts, column and bar charts, XY plots, line graphs, and stock charts. This truly made the spreadsheet a spatial, visual tool rather than a linear, mainframe programming approach for solving problems. Spreadsheets became the first "open" form of program; rather than being a "black-box" compiled program, they were a "seethrough" box that did not need a compiler. Most importantly, they were a program that allowed other users to make simple changes and additions. Having the ability to check formulas and data and graph the results of calculations and "what-if" scenarios brought many PC users into the spreadsheet world (Hicks 1998).

Departments bypassed budgetary restrictions, bought PCs as office equipment, and also bypassed the information systems (IS) gatekeepers to give "power to the people." Companies responded by instituting purchasing policies, including ensuring the uniformity of hardware and software to allow IS to reassert its control. However, the damage had been done-spreadsheets were on the loose. The first networks (the "sneaker nets"-saving files on disk and running the disk over to someone else) were the harbinger of using the Internet and e-mail to send files throughout the world. The flexibility of spreadsheets also weakened governance and control within organizations (Barnes 2006).

Microsoft introduced Excel as a Multiplan replacement and upgrade; because Lotus was not as responsive to its customers, Excel quickly gained market share on Lotus 1-2-3. However, the period from the mid-1980s to the early 1990s was a tumultuous time for Lotus as it tried to address competitive spreadsheet software; it tried to fend off Excel, engaged in lawsuits against Paperback Software's VP-Planner (Lotus was successful but lost its market to Microsoft) and a landmark lawsuit against Borland (which later became part of Corel). Lotus had charged that Borland, in developing Quattro Pro, had stolen the "look & feel" of Lotus 1-2-3, but Lotus eventually lost that battle. With Excel firmly gaining the lead, spreadsheets developers stopped improving graphing functionality or adding useful graphs (e.g., Box and Whiskers, a method of displaying data). Thus, they lost the opportunity to gain support in the scientific community-a user community that was dependent on statistical analysis. This community still stores data in spreadsheets; however, for statistical analysis it tends to use programs such as SPSS or SAS. Although these programs are more difficult to use, they do not have Excel's statistical-function errors, and they include many statistical-graphing functions.

How Spreadsheets Changed Training

In 1983, the first author was involved in giving PC and spreadsheet training seminars to business executives at Wake Forest; from 1984 to 1986, he served as director of the Georgia Tech Computer Institute (GTCI). During this time, he saw several issues arise.

(1) Some executives viewed the keyboard as a secretarial tool and refused to participate in the seminars. Those that did participate sometimes came in early (under cover of darkness) for help with typing. Although they knew typing was a valuable skill, they were embarrassed to be seen struggling in class or asking their secretaries for help. Typing is no longer seen as secretarial or associated with low-level jobs. In the mid-1980s, high schools began to teach the skill, which they labeled keyboarding; later, junior high schools taught it; today, elementary schools teach it. By the time children can read, they can also type, although perhaps not using the proper QWRTY keyboard (Meall 2005).

(2) Some trainers found that secretaries who could type 80 wpm suddenly forgot where the number keys were, or they could enter data quickly but could not comprehend how to write a formula. During this period, the first author received a frantic call from the Georgia Tech accounting department because the spreadsheet it was using did not change when new data were entered. He found that the secretary who had developed the spreadsheet had hardcoded all the column and row sums rather than using the SUM( ) formula. Underlying these experiences was a resistance by some to how technology was transforming the office; some managers were shocked because they were expected to prepare their own word processing documents and spreadsheets. The secretary's role began to change drastically. Freed from retyping documents, their job responsibilities began to include keeping spreadsheets on budgets and expenditures.

(3) Although all seminars were enthusiastically received, some companies believed that if they sent only one person for training, by osmosis everyone in the office would magically learn what had been taught (this is analogous to an undergraduate putting the textbook under his or her pillow to learn while sleeping!).

(4) Other companies and organizations realized that new hires had already received spreadsheet and word processing training in school. GTCIwas ready to bid on a large Air Force contract to train officers on using these programs. However, a colonel realized that if he just waited a few years, all new second lieutenants would already have that knowledge from their ROTC programs; these officers could then train the enlisted people. The contract offer was withdrawn.

(5) Spreadsheets were command-oriented rather than application-oriented. Therefore, users could not simply read a manual about spreadsheet functions and easily transfer that knowledge to their work. At GTCI, we wrote our own materials; however, some clients still had difficulty transferring the skills they had learned in training sessions to their specific work situations.

Because spreadsheets looked so simple, businesses thought that ordinary, nonprogramming business people would be able to grasp them quickly. However, it soon became evident that training was timeconsuming and costly; moreover, it was not needed. The new college graduates who were entering the workforce would infuse the organization with these new skills and obviate the need for training. Businesses that focused on spreadsheet training began to fail; therefore, human resources (HR) departments were required to provide any necessary internal training. However, because they did not (and do not) have the functional skills in finance, accounting, marketing, or MS, their training programs were ineffective. Companies were ignoring the hidden costs (inefficiencies) of not training (Bellinger 2005).

Thus, in many organizations, spreadsheets were more "caught" than "taught." While employees were willing to share their spreadsheet templates and their little tricks and traps, most businesses did not schedule formal training. Employers just assumed that employees understood spreadsheets (or could learn them on their own). When money was tight, training (if offered) was (and still is) one of the first things to go, and probably never to return. Although employees and employers usually knew that spreadsheets save time and increase efficiency, they did not know how to measure the cost benefit. Benchmarks showing the value of AutoCAD and similar programs were available; businesses could determine how long it took to develop a drawing and how many revisions would be necessary. Similar benchmarks did not exist for spreadsheets. Research has shown that logical-reasoning skills significantly increase after just six weeks of spreadsheet training (Kruck et al. 2003); however, associated dollar costs are not available.

In 10 years at Pepperdine University, the first author has taught more than 1,500 employed MBA students. During this period, entering students have not shown any noticeable, extensive improvement in computer or spreadsheet skills. Some students are quite adept; others are totally clueless. Their companies were usually amazed at what their employees learned to do with spreadsheets; they dubbed some employees as queen or king of spreadsheets. The attendant danger was that these employees spent more time helping other people than getting their own work done. Only a small percentage of people could pick up a manual, watch a video, or attend a training session, and become proficient with spreadsheets. Many who were trying to learn spreadsheets needed someone to coach them through different functions or aspects that they needed for a particular task; they accumulated enough familiarity to competently handle spreadsheets over time. Each semester, the first author learns something new from students and incorporates it into the quantitative courses.

Perhaps, training companies and their materials failed to help people learn how to use spreadsheets because of their mainframe, linear mentality. They believed that by teaching several commands or functions, a student would understand how to use them. They might have been more successful had they used examples from the employee's work to explain spreadsheet use.

At Pepperdine, we had academic-computing staff members who were dedicated to developing training materials and seminars for our business, education, and psychology graduate students. However, most of the IT staff were not knowledgeable in these fields- they knew computer programming; therefore, the training was ineffective. Students often said that they learned more in one night in a quantitative, finance, or accounting class using spreadsheets because the material applied to their work.

Today, business and engineering schools teach spreadsheets, mostly to undergraduates. Universities assume that MBA students know spreadsheets or will learn them from their classmates or in an introduction session. Textbooks that include spreadsheets cannot devote much space to teaching the basics; they assume that students will learn more quickly by using them in applications than they would by using the traditional approach to learning programming. Corporations are now providing professional training internally; this training is targeted to actual users and applications within the organization to teach and demonstrate the power of spreadsheets to help manage the organization (Winston 2001).

How Spreadsheets Changed the Teaching of Basic Management Science

We credit PCs and spreadsheets with saving MS from academic oblivion in business schools and allowing tens of thousands of people to use it, instead of only a few hundred business people. There are 20 million small businesses with 10 or fewer employees. Thus, the ability to perform analysis without using expensive programs or requiring extensive training has moved the analysis of numbers and manipulation of data to the grassroots level (Lohr 2003). Tens of thousands of business students have now been trained in some form of mathematical modeling on spreadsheets using the Solver; although they might not develop LP models at work, they are able to do some simple calculations and analyses (e.g., what-if analysis). For those students who only take one MS course, the power of spreadsheets is a revelation. The first author regularly receives e-mails from former students telling him how their abilities to develop simple analysis spreadsheets have made them heroes at work or even earned them promotions. Spreadsheets also had a major role in the 2003 drive by professional organizations, such as INFORMS and the Decision Sciences Institute (DSI), to convince the Association to Advance Collegiate Schools of Business (AACSB) to reinstate MS as part of the core competencies after a 20-year hiatus in business schools. The first author wrote a two-part article (Hesse 1974) predicting that our profession would disappear from academia (not from practice in business and industry) if professors did not change their methods of presenting the material as mathematics appreciation rather than problem-solving. Many PC applications now accept spreadsheet input and produce spreadsheet output, allowing users to see and check the data and graphs or rearrange the output. In the early days of linear programming, we had to use computerized "report writers" to manipulate the arcane output of huge LP programs so that nonmathematician managers could read the results.

How Spreadsheets Changed the Viewing of Data

Lotus 1-2-3 derived its name from the integration of its three basic capabilities: real-time calculations, graphing, and database operations. Databases proved to be important lists that offices and businesses used. Each record was a row; spreadsheets gave users the ability to sort, filter, and perform operations that saved them much time and energy. In addition, functions such as SUMIF( ) and COUNTIF( ) allowed users to extract information quickly. The first author remembers that the week after he demonstrated the "Data . . . Filter . . . Autofilter" command in Excel, a student remarked that this command saved her at least two hours of work each day. She was so excited that she showed her boss, who simply responded "Ithought you knew that!" The student said she "could have killed him"-her boss was not aware enough to show her a spreadsheet function that was vital to her work. Pivot tables increased the usability of these data structures because they allowed users to rearrange data quickly and easily, and to determine averages, counts, and other statistics by different categories.

How Spreadsheets Changed University Education and Textbooks

In the summer of 1993, a publisher asked the first author to review Don Plane's Management Science: A Spreadsheet Approach for Windows (Plane 1994), the first MS text that used spreadsheets (it used What's Best as an optimizer). His initial thought was that because the mathematics of linear programming was linear and had been programmed in many computer languages, this was not a good idea. However, as he reviewed Plane's manuscript, he was struck by how it offered a different view of modeling; thus, all the cherished mathematics techniques (e.g., the Hungarian method of the assignment problem, simplex method, transportation, and critical path) would not have to be taught. Multiple professors have told the first author that they would not use a spreadsheet approach because they like showing the students how smart they are mathematically, and spreadsheets level the playing field. The first author had long since given up doing the pivot-row cha-cha-cha of the simplex method; instead, he used simple algebra to demonstrate how the method worked. He had also written a BASIC program that provided the solution and a postoptimal report that human beings could read; however, the first author had no idea of the complete revolution in store for his chosen field of teaching and practice. He began an alliance with Dan Fylstra, founder and president of Frontline Systems and publisher of VisiCalc, to develop his own textbook (Hesse 1997). When VisiCalc was sold to Lotus, Fylstra spawned several companies, one of which was Frontline Systems. Because of his relationship with Lotus, he was able to develop the Solver add-in, with a simplex search engine and a gradient search engine (for nonlinear problems).

The first author gradually changed all his lecture material to be spreadsheet-based, and was challenged a few times to be able to make the crossover. After reviewing early drafts of the material, one colleague commented about its trumpeting that spreadsheets meant students did not need to know algebra: "Students don't mind algebra-what they mind is endless algebraic manipulations!" Bingo! It allowed the first author to show algebraic representations of models unapologetically, then let the spreadsheet do the grinding-the plug and chug. It also gave the students the opportunity to study the results to verify that the results made sense-that they had entered the data correctly. Not since the days of slide rules had we been emphasizing what the answer should look like; this allowed students to sharpen their intuition and common sense. Having written the Betamax version of the text (Hesse 1997) in this area (great reviews, no publisher support), the first author has faithfully tried to show spreadsheet applications in his In the Classroom column in Decision Line, a publication of the Decision Sciences Institute (http://www.decisionsciences.org/ publications/default.asp). While the first author saw the dramatic impact on MS from spreadsheets, the second author was seeing the impact in the fields of science, accounting, finance, and even insurance.

Spreadsheets in the Sciences and Other Fields

In the sciences, there were several spreadsheet hurdles to overcome. First, although spreadsheet training was available, it was all business-based. Thus, one had to learn how to use a function and then determine how to apply it. Having a diverse background in accounting, mathematics, computer science, and science, the second author was able to determine some ways to apply the tools. She taught one person how to use a pivot table and reduced that person's eight hours of work on a single spreadsheet to two minutes. A second hurdle is the prevalence of scientific data that must be rigorously, statistically analyzed for validation of a hypothesis. The statistical analysis tools were not as broad and pliable as necessary; in addition, there was often a lack of knowledge about the irregularities in the statistical functions in some of the spreadsheet programs. It may be that users assumed that the program must be right-otherwise, it would not have been released. A few papers (Hesse 2006, McCullough and Wilson 2005) bring attention to the need to look at an answer to see if it makes sense. Because some in science used prayer to make it through statistics courses, determining if an answer makes sense is not an easy task. In addition, the graphing that was available in spreadsheets was limited; often, it was not capable of presenting data in the statistical manner with which the scientist was familiar and required.

Databases that contain environmental data are often not set up for analysis; thus, spreadsheets become the translator. Simple calculations might need to be performed on the data to calculate another field. Then the data must be imported into a graphing or statistical program for analysis. The spreadsheet could have been used for all this work if the graphing and statistical analysis tools had been as broad and pliable as needed. It has been a long, winding road from books of tables for the normal and chi-square distributions, to specialized calculators, and to spreadsheets (Campbell-Kelly et al. 2003).

The second author has seen how spreadsheets have made accounting and finance more understandable to those who are not familiar with these disciplines. Spreadsheets can be used for many functions, including tracking expenses, logging hours worked, calculating project bids, determining family budgets, and calculating profit or loan payments. Thus, we are no longer dependent on experts to make such calculations.

Some in the insurance industry are still struggling to comprehend the world of the mainframe; many field personnel are still trying to understand how to use a PC, let alone a spreadsheet program. The second author's husband, an insurance adjuster who has no interest in algebra but does know the model year of every vehicle he passes, is thrilled with the simple spreadsheets she set up for him. Colleagues throughout the country have seen these spreadsheets and have dubbed him a "computer expert."

Although spreadsheets have made many aspects of the second author's jobs easier and more efficient, they have also become too standardized ("one size fits all"). Therefore, many companies have developed their own templates or relied upon a plethora of addins, such as Crystal Ball, @-Risk, and Risk Solver, that cater to specific industries or disciplines, or that include more robust statistical analysis (e.g., JMP) and graphing capability. Perhaps these spreadsheet templates and add-ins, which might help industries that are still struggling with spreadsheet limitations, have the capability of revolutionizing other fields as spreadsheets did for MS, accounting, and finance.

Danger, Will Robinson!

As Robbie the robot said in the TV program Lost in Space-"Danger, Will Robinson!" Spreadsheets looked so friendly and benign that the danger of undetected errors lurked right in front of our eyes. The University of Hawaii's Ray Panko has done extensive research in this area (Panko 1998). His research showed that one percent of formula cells had errors, and that 95 percent of US firms (and 80 percent of European firms) used some form of spreadsheets for financial reporting; thus, they were subject to the Sarbanes-Oxley Act. Of 88 spreadsheets audited in seven studies, 94 percent contained errors. In 2003, Fannie Mae admitted to making a $1.2 billion error in calculating third-quarter earnings on a spreadsheet, while a former vice president of HealthSouth admitted making up an incorrect spreadsheet for auditors and inflating earnings by $3.5 billion (Martin 2005). This illustrates an inherent danger-that spreadsheets are so simple that companies forget to institute quality control of the data and formulas (e.g., error checking and testing procedures). Another danger is that companies use spreadsheets to obfuscate data and results, giving new meaning to the acronym GIGO: garbage in, gospel out (O'Toole 2007). Many people think that because something is printed out from a spreadsheet, it must be true and accurate.

Today, many organizations still have no procedures for developing and updating spreadsheets. Numerous other articles have warned of the dangers of spreadsheet errors (Caulkins et al. 2006, Hicks 1998, Howe and Simkin 2006, Kruck 2006, Randles 2005).

Clearly, employees need sufficient knowledge of spreadsheets to (1) be able to use a template correctly, (2) develop a useful working template, and (3) change a working template (McGill and Klobas 2005). In addition, it is clear that spreadsheets must be checked for errors, using either built-in error checking or a peer-review process. We suggest that companies follow the rules we outline below (if they are not already doing so):

(1) Seek out the best of your spreadsheet developers for tips about how to teach the use and development of spreadsheets internally.

(2) Ensure that an employee who learns spreadsheets is required to teach at least one other employee.

(3) Set standards for developing and changing spreadsheets.

(4) Ensure that at least two people check spreadsheets for errors of omission, commission, and transmission. Use data sets to check for accurate calculations.

(5) Take spreadsheets seriously. When they are used effectively, spreadsheets provide tremendous efficiencies to a company's workforce.

Conclusion

From our perspective, spreadsheets have not saved the world; however, they have changed it substantially. They have saved PCs from becoming programming and word processing machines; they have also saved the field of general MS in academia-how we look at data, analyze it, and make it accessible to others. This paper shows that there is a need for good training in business, a need for company standards for writing and changing spreadsheets, and standards for measuring spreadsheet errors.

Acknowledgments

We gratefully acknowledge the guidance and help from the two reviewers, the associate editor, and the editor of Interfaces to improve this paper. We also thank the editors of another journal that had accepted this paper for a special issue, but then could not get enough qualified submissions to complete the issue.

References

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