Some people may still consider spreadsheet tools as something only accountants or financial professionals would use. However, spreadsheets are an essential tool in EVERY industry and EVERY profession. They can be used to assess, analyze, record, and present data of many kinds. And, when used correctly, spreadsheets are one of the most powerful data analysis tools available. In this article, we’re going to explain exactly what modeling spreadsheets are, and how they are used by many different professionals to carry out a variety of tasks.
What is a Modeling Spreadsheet?
Professional modelers can simulate how complex processes would alter in response to various model assumptions & variables. They’re basically a simplified version of what occurs in the real world. They allow businesses and individuals to reduce the amount of speculation in decision-making and actively address ambiguity or uncertainty.
Models are basically a simplified version of what occurs in the real world. They allow businesses and individuals to reduce the amount of speculation in decision-making and actively address ambiguity or uncertainty.
Financial models are probably the most common, but there are many others as well. Among them are statistical models, future planning models, and project tracking models.
Who Uses a Modeling Spreadsheet?
To give you an idea of just how versatile modeling can be, here are some real-life examples of professionals using modeling to carry out different objectives.
Accountants: models are indispensable to accountants! They enable them to analyze, report, and share financial information. Among the most common accounting model uses are calculating profits and making predictions about the financial future of the business.
Project Managers: modeling is a tool that businesses can use to manage projects and adhere to deadlines.
By using spreadsheet models, teams can:
- Estimate a task’s duration
- Examine data after a project is finished to see how accurately they’ve adhered to their objectives and to decide what changes to make going forward.
Sales Departments: modeling is particularly useful for keeping track of sales, returns, and overall sales revenue. Salespeople use spreadsheets to organize information and monitor metrics’ evolution over time. They can then create a sales analysis report using the data from their model to inform others about the state of their company’s sales operations.
Investment Bankers: investment banking is a branch of the financial industry that focuses on determining the worth of businesses. Analysts use financial modeling to calculate the past, present, or projected value or financial performance of a company or asset.
The list above only showcases a fraction of professionals using modeling daily around the world and in a wide array of industries.
Do you work in one of these roles? Take our fast, fun, 30-second Spreadsheet Avengers quiz to find out where your spreadsheet modeling strengths and weaknesses lie!
What are Modeling Spreadsheets Used For?
As mentioned, spreadsheet models touch EVERY industry in some way! Here are just a few examples of how they’re used in the real world…
Spreadsheets are widely used in business to manage accounting data. This includes maintaining a budget and keeping track of receipts and payments. Financial modeling is also often used to predict business growth, sales, revenue, and profits. Businesses use financial modeling to simulate different scenarios so that they can not only be prepared for the future, but also have the knowledge they need to make changes where necessary to achieve the desired outcome.
The primary function of spreadsheets is to capture and store data, but they also provide the ability to analyze and manipulate data. Basic spreadsheets typically consist of addition, multiplication, division, and subtraction, but users can build more complex statistical models from these elements to gain a comprehensive picture of a company’s operations. It is also possible for spreadsheet users to create their own formulas for determining analysis according to their business needs.
We all know the role that planning plays in a business. Without it, there is little chance of success and growth. Businesses use planning models to assess where they are now and what impact changes would have in the future. This information can be visually displayed in a graph or chart, allowing teams to see, theoretically, the benefit of implementing these changes.
Although spreadsheet data can tell a story using only figures, there is an even better way that businesses, modelers, and analysts can showcase and present their data and predictions in a more visual and impactful fashion. Spreadsheet tools, like SheetRocks, allow you to convert your data into graphs and charts. This is not only beneficial when presenting to the team, investors, or management, but it can also be used as a marketing tactic in a business campaign.
With so many moving parts, it would be impossible to succeed in business without project management. Modeling can be used to manage projects in a comprehensive manner. All tasks can be continuously tracked with each team member added along with their responsibilities, progress, and completion dates.
Cool Real-World Examples of Modeling Spreadsheets
By now, you should be pretty convinced that modeling spreadsheets aren’t just for the financial industry. At its very core, modeling is a way that we can simplify how something may look in the real world. It is how any industry can make predictions based on data in order to plan, manage and implement.
If you want to check out some amazing real-world examples of models in action, hop over to our article “4 Modern Spreadsheet Modeling Examples”
You’ll learn various different models, including;
- Spreadsheet Model for Quantitative Finance (Finance Industry)
- Spreadsheet Model for Epidemiology (Health Industry)
- Spreadsheet Model for Environmental Planning (Eco)
- Spreadsheet Model for Nature Science (Science)
You may now be gearing up to try some spreadsheet modeling for yourself and or for your business. But before you do, let us show you how SheetRocks is your answer to spreadsheet modeling success.
SheetRocks is a sophisticated spreadsheet solution for spreadsheet modelers who want to accurately and speedily perform complex analyses of large amounts of data. But, that’s just the tip of the iceberg on what SheetRocks can do.
SheetRocks also boasts:
- Processing speeds 120x faster than Google Sheets
- 400+ built-in Formulas
- Real-Time Collaborations
- SOC 2 Compliance
- XLSX Compatible
- Familiar, Convenient Formulas
- Charts, Plotting & Formatting
- Scripts & Automation
- Programmable API
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