Excel at 40: The spreadsheet that changed everything

Garreth Hanley:
This is INTHEBLACK, a leadership, strategy, and business podcast, brought to you by CPA Australia.

Tahn Sharpe:
Welcome to INTHEBLACK. I'm Tahn Sharpe, editor of INTHEBLACK at CPA Australia. Now, today is a special episode because we're discussing and celebrating to an extent the 40th birthday of what my guest calls the single most important app in the world. Microsoft's Excel spreadsheet program.

Excel is of course a foundational piece of software for accountants, CFOs, and businesses more broadly, and has been for many decades. My guest today is one of Australia's foremost experts on Excel and an avid commentator on the technical tools used by accountants.

Those of you who regularly read, watch and listen to our Excel Tips content will be familiar with Neale Blackwood, CPA, who puts them together. But it's worth noting that Neale himself is also a 30-year accountant and has literally written a book on Excel spreadsheets, which we'll get to later. Welcome to INTHEBLACK, Neale.

Neale Blackwood:
Thanks, Tahn. Great to be here and great to be celebrating Excel's birthday.

Tahn Sharpe:
Now, let's start with your personal journey as it relates to Excel. What do you remember about using Excel for the first time and what really hooked you on it?

Neale Blackwood:
Well, I was lucky, I guess I worked at the UWA, so University of WA. And they had a policy of having Macs, so all their computers were Apple Macs. And Excel was released first on the Apple Mac, so I got exposed to Excel fairly early in the piece.

And the big thing about it was it was graphical. So spreadsheets up until then had been very text-based, if you like, or very boxy. And so, the Macs obviously were the first computers to have graphical user interfaces. And so, using a spreadsheet on the Mac was a different experience. It did the same things, it added things up, it multiplied, all that sort of stuff, but it looked a lot better.

And so, yes, that was the start, if you like, of my Excel journey. But then, after I left the uni, unfortunately I was thrown back into the DOS world where Lotus was the king, and so I had to go back to the texty interface that was used on DOS.

Tahn Sharpe:
I see. So when was that? When was your first exposure?

Neale Blackwood:
I think it was about '87. So it was released in '85, but I think I first used it on a Mac in about, it might've been '86, '87, so around there. And so, I used it for a couple of years before I moved on.

Tahn Sharpe:
Right. So you were an early adopter who was then away from Excel for a while. How did Excel evolve through the '90s? You said that was '85. So through the '90s and early 2000s, especially as Windows became dominant, what were the game-changing features for finance professionals?

Neale Blackwood:
Well, Lotus was king for the early '90s. But Lotus's big mistake was it delayed, I don't know why, it delayed the change to Windows. And Excel, because Excel was already like a graphical, had a graphical interface, Excel jumped to Windows very early, and that was the big change, because remember back then, and even still now, IBM compatible computers or PCs were the dominant computer.

So being at the university, it was unusual to actually have Macintosh computers. Out in the real world, everyone had DOS computers, which then got upgraded to Windows, and Excel and Office. Because the other thing, Excel was part of Office, which... it’s still around, but now it's a subscription thing. But basically, Office had Word, PowerPoint, Access, Database, as well as Excel. So you had everything you needed basically in the one package, and so you could buy Excel separately, but usually you bought it with Office, so you got everything as well.

The reason Excel took over was that it was on Windows and Lotus wasn't. You had to go out to a separate window, if you like, and run the old DOS programs to access Lotus, which was very clunky. So that's why Excel took off. And then, development-wise in the '90s, it brought in Pivot Tables. One of the problems with Excel is some of the names it uses aren't really human-friendly, like Pivot Tables doesn't make any sense, but they allowed you to summarise huge data sets into a report without any formulas.

And so, they were sort of a game changer. And then, the next thing that they brought in was something called VBA, which was Visual Basic for Applications. So Visual Basic was the major programming language at the time, and the VBA was like a cut-down version of that, that allowed you to manipulate the Excel environment and Access and Word, but pretty much most people used it for Excel or Access, and that was a game changer because that allowed you to programmatically, so write computer programs, that could do things in Excel, and that was a huge leap for macros.

So before then, macros were very clunky and they couldn't really do a lot, but once VBA came in, then the world was opened, if you like. So you had a programming language you could use in the background that could totally control Excel, and it still can. That's one of the advantages of VBA and macros in Excel. Then, development-wise, the next biggest leap was in 2007 because up until then, there was a limitation of how many rows, well, the limitation was fairly low for the number of rows and columns.

So you had 65 odd thousand rows and 250 odd columns that you could have in the spreadsheet. Well, in 2007, that got blown open and basically you could have a million rows and 16,000 odd columns. So that was a huge increase in the capacity of Excel. There was also the change to the ribbon, which was a different interface.

Now, there's an interesting story behind that. Basically, before they developed Excel 2007, which as I said was a big upgrade, they did a survey of a lot of users and they asked people what did they want Excel to do, and they got their responses from the survey and they found out that 80 cent of what people wanted was already in Excel, but it had weird names like PivotTables or it was hidden away in the, because back in the old days there was a menu system that you access the features.

And so, the idea behind the ribbon that they changed it to was that you got everything on the screen so that you could get as much as possible done with buttons or icons on the screen. So that was the story behind the ribbon to try and get as many of Excel's features out in the open if you like.

A lot of people hated it when it came out because it did take up a lot of space on the screen. You got to remember back then, screens were a lot smaller, and so the fact that you took up the top section of the screen affected how much of the spreadsheet you could show. But eventually, people got used to it. Screens got bigger, the screens got cheaper, and so now everyone, people love the ribbon now. But back in the day, again, a lot of people were against the ribbon interface.

Tahn Sharpe:
They really positioned them well for the future by putting that ribbon in there, anticipating that screens would get bigger, and we take for granted now how fundamental the Office suite is, but really looking back, it was such a masterstroke to really bundle up those foundational programs together. And now, we're at a point where for CFOs and accountants, Excel isn't just a tool, it's infrastructure. So why has it remained so central to business decision making and really outlasted competitors, like, as you mentioned, Lotus?

Neale Blackwood:
Some of it is to do with the VBA macros because you can do a whole lot of stuff that, so for example, if something can't be done with the built-in tools of Excel, pretty much you can probably write some macro code that will do it, so you can get around the limitations. And also, it's because you had the Office suite. A lot of people got Office just for Word, just for writing stuff, and so Excel was like a bonus.

So you got to remember that accountants live in Excel, but the rest of the world also use it as well. So engineers use it and lots of other people use Excel as well. So it goes across platforms, it goes across industries, everything. So that's the big advantage. I saw a meme recently that mentioned that I think that the estimate is there's over 1 billion Excel users around the world, and I think they were comparing it to the number of cars in the world as well, and how many people drive cars compared to people using Excel.

It kept developing as well. So that was the other thing. Microsoft has kept building onto it and building extra functionality into it. Power Query, which they added in the mid-teens — that basically automated the importation of data into Excel. And then, Power Pivot, which is like a PivotTable on steroids in a good way, allowed you to work with multiple tables. So they've kept developing Excel, so it's been more and more powerful.

And in the mid-teens, they also released Power BI. So Power BI is the next level of Excel. It's got a steeper learning curve than Excel. So Power BI does take a lot of effort to learn compared to Excel, which as you know, you can pretty much jump into Excel and start doing things pretty much straight away. There's not much of a learning curve required to use Excel.

Tahn Sharpe:
Right. And in the interest of balance, what don't you like about Excel, Neale? And you did mention there before that some of the features have been perhaps misnamed or not optimally named. What has Microsoft missed out on or failed at with Excel over the years?

Neale Blackwood:
Okay, so my major bug there with Excel, and this is coming from the Lotus environment. In Lotus, you could type 10 plus 10 and hit enter and it would put a formula in the cell for 20. Okay, great. Excel won't do that. You have to go plus 10, plus 10 to get the 20, and you have to use that extra character at the front to get, so that was my, it's a very small thing, but that was my major frustration when I jumped over to Excel again from using Lotus.

The biggest thing that Microsoft was too slow on was, and what Google Sheets allows you to do a lot better, and that is working with other people on the spreadsheets, so the collaboration side of it. Microsoft was very slow to embrace the web side of using a spreadsheet, which Google Sheets basically is better at. Excel's better at it now than it was, so Excel has developed and there is a browser-based version of Excel and also you can save onto OneDrive and SharePoint and do collaboration, but they were slow in actually getting that out, whereas Google Sheets did a better job of it earlier, if you like. That was the major thing that they were slow on.

Tahn Sharpe:
Sure. That's actually a good segueway to my next question. I want to know where Excel is in the modern world and how it's adapting to the rise of cloud computing, AI, automation, and mobile workflows. Is it keeping pace with modern demands and evolving into a smarter, more predictive platform, or is it being replaced in some areas?

Neale Blackwood:
It's really hard with AI at the moment because there's so much hype around AI. Excel can use AI and I did an article, I think it's a few years ago now. There was a thing called, bear with me, I'll just open it up, open my Excel up so I can remember what it's called. I think it's something like data analysis. And that's one of the other problems with Microsoft is they do sometimes... oh, ‘Analyse data’, I think it was, they do sometimes rename things, which can be a bit disconcerting. But there was an Analyse data feature which allowed you to specify a table and it would then give you insights into that table. And that was their first trial in AI, and now that they're going to bring out the Copilot function.

So the idea behind that is that you can equals Copilot, open bracket, and then refer to a prompt. So you can have a prompt in a cell and then you go comma, and then you can tell it or show it a range that's, let's say, a table. So in that formula, you can get it to provide an answer. So you can use the prompt to ask the question and then the data set to define what you want to work with, and it will come back and give you the response to your prompt.

And you can do that multiple times. So you can have multiple prompts and multiple data in the one formula, and that formula can then spill down and across to actually populate the answer. And that new function has split the Excel community, which isn't unusual. The Excel community does get split fairly often, but a lot of people are worried that this Copilot function might be used to do calculations. It shouldn't be used.

The idea behind this Copilot function is that you are looking for things that you can't do with normal formulas in Excel. So things like sentiment analysis where you might have a list of all feedback and you want Excel to analyse that, and that's where the Copilot function can really come in. But that's also where Python, which we've just done some articles on Python in Excel, that's a brand new feature and Python has the ability to do sentiment analysis as well, which is something Excel doesn't have as a feature. It's good with numbers, it can work with text, but it can't understand text, which is where AI comes in. So AI can read text and then understand it, and then you can use that to get some ideas behind all of the different sentiment analysis that you might want to perform.

Tahn Sharpe:
Sure. Well, you touched on Python there, which is linked to my next question. For younger accountants that we have entering the profession, is Excel still a must-have skill or are we seeing a shift towards other platforms and coding languages like Python?

Neale Blackwood:
I think Excel is still a must-have skill because so much of the world is dependent on Excel files. But yes, there are other things that they should be learning, like Power BI is something that's a skill that you probably need to look at whether you need it. Power BI is Microsoft's dashboarding reporting solution. So as I mentioned earlier, it's got a steep learning curve. You do need to have a good knowledge of relational databases to get the most out of Power BI. It can just work with a single table, but it tends to work best when working with relational databases and related tables. But Power BI, definitely a skill.

Python, if you are into data and doing a lot of stuff with data, then Python skills are probably useful. But again, a lot of the stuff you do with Python, you can do in Excel. The examples I used in the recent articles, I tried to do things in Python that Excel struggles to do or is difficult to do, and Python can do them fairly easily. That's the advantage with Python. There's a lot of stuff in Python that can be done very easily, which is very difficult to do in Excel. But yes, definitely Python is up there. Power BI is up there. But I think Excel is the thing, it is the cornerstone or the base, if you like, that you do need good Excel skills.

Tahn Sharpe:
Right. And I'll give a quick shout out to the recent Excel tips article that we published, which was done by yourself on integrating Python in Excel. Is that right?

Neale Blackwood:
That's right. So that's a brand new feature. You can write Python code inside an Excel cell and it will then run the Python. It’s sort of a cut-down version of Python. It's not the full version of Python, but a lot of Python code is now available to use in Excel and AI writes pretty good Python code. So that's another way to learn it.

Tahn Sharpe:
Okay. For my last question, Neale, I'd like to ask for you to make a prediction on Excel's next big evolution. What might we see in the next 10 years? What would Excel look like at 50, perhaps?

Neale Blackwood:
Well, one of the things you've got to keep in mind is they can't get too radical with Excel. One of the things that Microsoft has always been pretty good at is backward compatibility. So they've got to make sure everything that used to run in Excel is going to run in the updated version. So they can't get too radical. And that's where Power BI came in. That's a totally different app, and they built that from the ground up, if you like, and that used a lot of database information. So Excel is probably not going to look very different in the next 10 years, but what they will do is they'll keep adding extra functions to Excel to again extend it.

It will be interesting to see how this Copilot function... it hasn't been released to the world yet. It's in data testing, but it will be interesting to see how that comes out and how that is used, because that can be used by people without much Excel skill to be honest. They can just put in a prompt and then link to that prompt and link to a data set to be able to pull out information and highlights and that stuff from the data. So it might allow people to do some very quick analysis without a lot of effort, to be honest.

Tahn Sharpe:
I did say that was the last question, but I've got a bonus one for you. Can you make the case for Excel being the most important app ever made in the world to this point?

Neale Blackwood:
Well, if you imagine what companies would do if Microsoft could magically switch Excel off, it would be major problems. One of the companies I used to work with, they decided to go to the G Suite, so Google Suite, but the only thing they didn't take in the Google Suite was Google Sheets. They made sure that they still had Excel as a separate entry. So they recognised that Google Sheets might do most of what Excel does, but it doesn't do everything that Excel does.

And that's the thing. Excel has built up over the years. And I don't think companies would survive very well if Excel was magically turned off. It would cause a lot of issues, I think. So there's so much in Excel, and Excel is used across different things. Again, as accountants, we tend to think as Excel as our app, but Excel is out there being used by engineers, by marketers, pretty much everybody uses Excel, I think.

Tahn Sharpe:
I think you're right, and I suspect you're also right about it being the world's most important app. Well, thank you, Neale. It's been fascinating to hear your thoughts on Excel and getting not only a history lesson, but a glimpse into the future of what probably is, as you say, the most important app in the world. And I would add on behalf of INTHEBLACK and our audience, thank you for all the wonderful Excel tips content over the years.

Neale Blackwood:
Cool. Thanks for that. And one thing to get excited about is the fact that 40, which that's how old Excel is going to be, is Excel in Roman numerals. So for all the geeks out there, that's worth getting excited about, and Excel does have a Roman function that will convert numbers into Roman numerals. So you can test that out for yourself.

Tahn Sharpe:
Very good. Excel being 40, I love the little serendipity there. For our listeners eager to learn more, please check out the show notes and additional resources from Neale and CPA Australia. Don't forget to subscribe to INTHEBLACK and share this episode with your colleagues and friends in the business community. Until next time, thanks for listening.

Garreth Hanley:
To find out more about our other podcasts, check out the show notes for this episode, and we hope you can join us again next time for another episode of INTHEBLACK.