Spreadsheet Woes – Limited Features For Easy Adoption of a Control Framework

Like it or not, regulations are here to stay and for a company to comply with them, its IT and financial systems will have to be equipped with a suitable control framework. One common stumbling block to such an implementation is a company?s over-reliance on spreadsheets.

Why is it so difficult to adopt controls for a system that’s reliant on spreadsheets? To understand this, let’s pinpoint some of the strongest, most powerful attributes of these User Developed Applications (UDA).

By nature, spreadsheets are the epitome of simplicity: easy to develop, easily accessible and easily altered. All computers in your workplace will most likely have them and everyone in your organization may be sharing them, making their own versions, and storing them in personal folders.

Sad to say though, these strengths are also control weaknesses and constitute the very reasons why spreadsheets require effective risk management.

Easy to develop. Being easy to develop, most spreadsheet systems are created by non-IT users who have limited knowledge on best control practices. Being constantly under time pressure, these ?developers? may also relegate documentation, security, and data verification to the back burner in favour of coming up with a timely report.

Easy to access. Information in a spreadsheet can be opened by practically anyone within the organization?s network. Who accessed what? And when? If anything goes wrong, it would be difficult to identify the culprit, and the failure to pinpoint responsibility for erroneous data could lead to bigger, more costly mistakes.

Easy to alter. Lastly, if the information is easy to access, then it can also be easily altered, consequently making reports more prone to both accidental errors and fraudulent modifications.

The rise of multimillion dollar scandals due to accidental and intentional spreadsheet errors have prompted regulatory bodies to publish guidelines for mitigating spreadsheet-associated risks. These controls include:

  • Change control
  • Version control
  • Access control
  • Input
  • Security and data integrity
  • Documentation
  • Development life cycle
  • Backup and archiving
  • Logic inspection/Testing
  • Segregation of duties/roles, and procedures
  • Analytics

In theory, these controls should be able to bring down risks considerably. However, because of the inherent nature of spreadsheets, such controls are rarely implemented effectively in the real world.

Take for example Security and Data Integrity. One of the most common causes of spreadsheet error is due to ?hardwiring?. This happens when values are inadvertently entered into a formula cell, naturally changing the logic of the spreadsheet.

As a way of control, cell locking can be applied on the formula cells to prevent users without the proper authority from making any changes. However, when reporting deadlines approach drawing spreadsheets to the forefront of data processing, more people are given access rights to the locked cells. Ironically, it is during these crunch times, when errors are most likely to happen.

Because the built-in features of a spreadsheet support none of the controls mentioned above, some companies are tempted to purchase control-enabling programs for spreadsheets just to continue using them for financial reporting. But although these programs can integrate the required controls, you?d still be interacting with the same complex and outdated interface: the spreadsheets.

Thus, these band-aid solutions may not suffice because the root cause of these problems are the spreadsheets themselves.

Learn more about our server application solutions and discover a better way to implement controls.

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Why Spreadsheets can send the pillars of Solvency II crashing down

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How an EMS Can Cut Your Carbon Emissions

Your business carbon footprint is directly tied to the efficiency of its energy consumption. From the equipment used in industries, lighting and air conditioning in offices, shopping malls and other commercial buildings, the load used by everyday machines like the coffee makers in the employee breakroom, to hot water boilers in apartment complexes, how much do your processes affect the environment? Standards like the ISO 14001:2015 are being implemented to enable businesses to reduce their impact on the environment, from optimising their energy usage, minimising waste, turning to renewable power sources, all through to preventing pollution and complying with their specific regulatory requirements. How do you handle the volume of data that needs to be obtained and assessed?

Energy management systems come in to enable you to analyse your consumption, identify factors affecting your total energy use – from temperature and humidity conditions, to equipment that is causing spikes, and observe your usage patterns. That way, you can put in measures to minimise wastage while increasing your operational efficiency, reduce your carbon emissions and track your progress all the way. Here, we’ll break down how this is achieved. 

Going Green With An Energy Management System

This is a holistic approach aimed at minimising wastage and optimising energy usage. It includes:

Auditing your energy consumption

The first step is really quantifying how much energy you use, which systems are causing unnecessary load, all through to where there are inefficiencies in the facility. Which equipment has the largest impact on your bill? An energy management system allows you to view it all from one dashboard, such as with the ecoVaro EMS that takes you down to the sub-meter level.

Here, you get real-time data that is collected by the ecoVaro loggers – from electricity use, gas, water, temperature, solar power, humidity, air pressure – the readings can all be monitored. This is done 24/7, and the consumption feeds are recorded. Moreover, ecoVaro pulse data is collected every 15 minutes – which is particularly important when it comes to analysing trends over a time period, be it daily, weekly or monthly. 

Data is only useful if it can be properly analysed, right? So instead of just bombarding you with spreadsheets of numbers, the EMS displays the records into graphs and charts that are easy to comprehend – all from the same interactive interface. So, whether you’re the energy manager in the facility, or you want reports that can be shared with the CFO, owners of the business, or even staff themselves to enable them to understand the energy saving policies that you will put in place – you will be able to carry this out. 

ecoVaro gives you different ways to analyse the data from the readings that have been recommended. For instance, the heat mapping from the interface allows you to see the building’s energy use during different periods at a glance. The site-by-site analysis in particular enables the building or energy manager to assess each individual premises, from checking which block in the school is causing the energy bills to surge, the facility whose performance is falling behind, all through to the office building with the highest carbon footprint. In fact, the carbon and sustainability reports from ecoVaro EMS enables you to see the impact that your operations have. You even get to compare tariffs from the different energy suppliers, that way you can go with the option that is most suited to your situation.

Setting a baseline for your operations

This is essentially a “before/after checkpoint” that you will use to compare the effectiveness of subsequent measures that you will undertake. After making modifications to the systems in your business, you will want a clear picture of whether the new measures are actually benefiting your operations and optimising your energy efficiency, or whether they are deteriorating the performance further. The energy baseline will be critical in analysing your progress. 

Reports like the CUSUM (cumulative sum) charts on ecoVaro show you the energy performance, be it of a boiler in a factory, office building, or chain of hotels – over a set period of time. You can then compare this to the baseline, which will show you if the changes you will implement will make you savings. The heatmaps also come in handy here, showing you the energy consumption at each meter, whether it is low, medium or high compared to the baseline that has been set. The heatmaps give a quick visual to analyse resource usage.  

Creating energy targets

After understanding your energy consumption and seeing how it impacts your business, next is mapping out short- and long-term goals that you want to attain to optimise your usage and reduce your carbon footprint. 

For instance, short-term targets can include the likes of decreasing the night-time lighting load, and adjusting HVAC uptime depending on the level of activity in your business premises for the different hours of the day. 

For the long-term targets, these include setting a specific percentage average kWh reduction for the different industrial sites or buildings under your management; lowering the demand kW throughout the building by a specific range year-on-year; as well as the percentage with which you want the carbon emissions decreased annually. 

Cost efficiency also factors in. For instance, entering your current tariffs into the conversion factoring dashboard on ecoVaro will show you how your consumption translates to the bills that you receive – and even shows you what you stand to save by negotiating for new energy contracts with your utility firm.

Identifying initiatives and implementing energy saving programs

These are geared towards improving your energy efficiency and reducing your carbon footprint. They vary from one industry to the next. For instance, these can include:

Getting motion/occupancy detectors and automatic dimmers installed in the facility

These are lighting controls that enable you to save money and energy by automatically turning the lights off when they are not required (people have left the room), and reducing the light levels for those cases where full-on brightness is not needed. For instance, the dimmer controls enable variable indoor lighting, reducing the wattage and output when dimming the lightbulbs, saving energy in the process. These can be manual, or operated with sensors or timers. 

Motion sensors on the other hand will automatically turn on the lights after they detect motion, then after a short while turn them off – they are typically used for utility and outdoor security lighting. There are also occupancy sensors used in rooms, which turn on the lights when they detect indoor activity, then turn them off or reduce the light output when the particular space is unoccupied. 

Switching to energy-efficient light fixtures such as CFL or LED bulbs

Lighting costs are a major contributor to the energy bills being footed by the business. What kind of systems do you have set up?

Incandescent bulbs are rapidly being phased out due to their inefficiencies. They work by a wire tungsten filament getting heated until it glows – a process that sees almost 90% of its energy being released as heat, instead of light. In addition, with an average lifespan of just 1,500 hours, there is the need for better alternatives – and they have already been around for over a decade: CFL and LED bulbs, which save on energy and have far less carbon emissions. 

Compact fluorescent light bulbs (CFLs) light up when an electric current going through a tube with argon and trace mercury gases generates ultraviolet light, stimulating the fluorescent coating that’s on the inside of the tube, which in turn produces light. As such, a 15-watt CFL will have about the same light output as a 60-watt incandescent bulb. This makes them approximately 4 times more efficient compared to the incandescent bulbs, with a lifespan of 10,000-15,000 hours. This translates into fewer replacements and greater energy savings. However, there are still concerns about the mercury that is in the CFLs, though it is still in small quantities – basically smaller than the tip of your pencil. In addition, the CFLS aren’t; dimmable. They are usually used as a replacement for incandescent bulbs before completely switching to the more efficient LEDs.

Light-emitting diode bulbs (LEDs) Take things a notch higher. Here, electrons moving through a semiconductor emit the light, and you can get the LEDs for visible light, ultra-violet, and infrared spectrums. Here, the lifespan is 25,000–35,000 hours, which is more than double that of CFLs, and leagues beyond the standard incandescent bulb. Moreover, with a 16.5W LED bulb you’ll be getting the same lighting as a 20W CFL, or a 75W incandescent bulb. 

You will notice that when you touch LEDs, they feel cool, and this is because less energy is getting converted into heat. With the energy efficient bulbs, you won’t have to run your AC harder during those hot months, further adding to your cost savings. You can be able to see such consumption trends over the months through the energy management system, getting to the root cause of the problem. For instance, seeing the changing trends in the AC energy consumption over different weeks will enable you to assess what is causing it to be pushed harder, and address the root cause of the problem. 

Acquiring energy-efficient office equipment

This is broad, with the changes being made here depending on your particular niche. Take printers for instance. Simply going for printers with sleep and automatic shut-off modes will ensure that the units are not consuming energy when they are not in use. The same case applies to copier machines. Energy saving surge protectors on the other hand are beneficial for allowing you to “unplug” multiple devices that use standby power even when switched off – what’s usually called “vampire power” or “phantom energy“. 

The need for energy savings cuts across the board, from the computers and monitors used, to the coffee makers and kettles. For instance, working with an electric kettle to heat water for tea beats using a microwave or stove. Go further by opting for a kettle that allows you to set the particular temperature you want for the water – since you don’t really need the water for tea to be boiling hot for the tea to properly steep. Taking such steps further contributes to your business’ efforts to go green and reduce your carbon footprint. 

Turning to renewable energy sources

Switching to renewable sources to power your operations will simultaneously reduce your energy bills and cut your carbon emissions. From solar panels to wind turbines and the like, they are cleaner sources of energy, and the installations that you go with will depend on your kind of business. Moreover, this will protect you from the fluctuations in energy prices, since the bills are affected by the availability of fuel, electricity demand, costs that go into generating and distributing it – all of which end up hitting your business in the long run. On the other hand, going off the grid with your own supply of power protects you from this. In fact, if you end up producing surplus energy, you can sell it back to the grid, earning your business extra revenue. 

Sure, the upfront costs of setting up the systems will take a sizable chunk out of your budget, but the savings allow you to recoup the costs over time. In addition, there will be savings from the incentives being provided by the government, such as tax rebates and grants. These are the likes of the Solar PV Grant from SEAI (Sustainable Energy Authority of Ireland) which is at €900 per kWp, capped at €2400 for each business. Funding is available for homes, community programs and commercial buildings such as  Collinstown Park School that was able to slash their lighting costs by a whopping 90% after securing 50% of the funding for their energy upgrade project from SEAI. The ecoVaro EMS comes with support for solar power installations in its firmware, that way you can continue assessing the changes that your solar power system will bring to your overall energy usage.

Spread awareness

You should also carry out energy conservation training for your staff. The reports generated by the EMS will make it easy for them to get a picture of their energy consumption trends, and the effects that it has on both the performance of the company, and the carbon footprint as a whole. It also gives them more awareness of the impact that they each have at an individual level. 

Assessing Key Performance Indicators

The energy analytics tools from the EMS will show you whether you are actually meeting your goals. Since it works with the different metered connections, from getting electricity and temperature readings, checking radiation levels, humidity data all through to gas meters, you will be able to assess the progress that your business is making across the board. 

For ecoVaro in particular, the performance of your systems can be seen through reports like Consumption Charts – from the different offices, tenants and equipment energy usage, peak -and off-peak data, as well as Regression Charts that allow you to compare building’s actual energy consumption to its expected performance, and how they are affected by variables such as temperature. 

With the site-by-site data and the monitoring being down to the sub-meter level, you will be able to identify an issue when it crops up and narrow it down to the specific instant and location where it occurred. This enables you to address the problem quicker.   

Conducting a compliance audit

A comprehensive audit can then be undertaken to ensure that your company meets internationally-recognized standards that have been stipulated regarding implementing energy management systems and enhancing the energy efficiency of your operations. The compliance audits are carried out by certified auditors.

Through the EMS, you are able to position your business appropriately to meet the standards for your particular niche, measuring and observing the performance of energy-saving projects that have been implemented. This extends to acquiring and presenting data that will be used to show the business’s compliance to industry regulations and obtain the relevant certification. You are able to report on your carbon footprint, and verify it. This information can also be disseminated amongst your employees and customers, raising awareness about your business green initiatives, boosting your brand in the process.

What is Servitisation?

In the current generation, innovation has transformed industries, businesses, economies, and livelihoods. Those who’ve accepted to embrace the changes have prospered and remained afloat and relevant in their respective industries.?

However, failure to embrace change has seen companies like Blockbuster pushed out of business by more innovative and technology-oriented companies like Netflix.?

What does this tell you?

That the only way to stay in business, despite the many challenges your business could be facing, is to remain alert to the dynamic demands of customers, many of which are dictated by technological advancements.?

So, if you’re a manufacturer and you’re keen on diving deeper into technology to stay on top of the game and beat your competition, you must also be expectant of the fast-approaching servitisation-centred economy. Companies like Rolls Royce that have already embraced servitisation are making great gains in their areas of expertise.?

What is Servitisation?

Servitisation can be defined as the transformation of a manufacturing firm from the mere offering of products to the market to providing innovative and invaluable services alongside their products. By so doing, the sale becomes an ongoing engagement and not a one-off event. Cranfield University professors call it “the innovation of an organisation’s capabilities and processes to better create mutual value through a shift from selling a product to selling product-service systems.”?

As foreign as it may seem for some professionals, servitisation has been a need that, though not embraced, its demand remains evident. Nonetheless, firms have hesitated to implement it. Shifting from manufacturing products only to incorporating product-centric services alongside the products is not a walk in the park. It boils down to completely changing the company’s entire structure and processes.

All the same, change is never comfortable, and that’s why it’s always best to focus on the positive for motivation.

Servitisation Case Study

Some manufacturing firms have already embraced servitisation, and they’re reaping big from it. They’ve understood the benefits of offering more value to customers at less cost. What Rolls Royce is doing currently with its “power-by-the-hour” program is a good example of servitisation.

Instead of selling Aero Engines and letting customers take charge of maintenance and uptime, Rolls-Royce now offers a full package that includes a product and relevant services.?

Essentially, what the company is creating is an intimate and long-term relationship with its customers.

The total care package by Rolls Royce means it’s essentially renting out its engines to customers and monitoring data for potential maintenance needs. The plan guarantees that maintenance is only done when necessary and avoidable damage detected in good time. As a result, there is a clear reduction in the overall cost.

Initially, Rolls Royce would make money by basically selling and repairing engines. That meant that the worse the engines, the more repairs required and the more the money the company would make.?

However, things changed when the company realised there is no demand for a product that’s constantly in the repair shop. That prompted Rolls Royce to embrace servitisation.

Servitisation aligns the interests of the customer and those of the manufacturer to ensure everyone benefits. Rolls Royce has been offering this package to airlines since 2010, and the company has seen significant returns as a result.

Benefits

There are several benefits of incorporating servitisation into your manufacturing firm. Below are three of the strongest benefits

  • Financial Stability– Servitisation establishes a more secure revenue stream because of the long term connection between manufacturer and customer. This also translates to loyal customers, meaning more profit.
  • Strong Customer Retention Rate– Being more experienced about the equipment and the constant tracking and monitoring that comes with servitisation; manufacturers are realising that they can keep more customers.
  • Selling a Solution And a Product– Today customers are not just looking to buy a product, instead, they want both the product and the solution to their problem. Meaning you make more money for the product you manufacture and the service you offer to your customers.

Implementation of Servitisation in the Industry

To effectively implement servitisation, there must be an effective two-way flow of information and data in the supply chain. Meaning you may require software like FieldElite for scalable condition monitoring of performance. With FieldElite, for example, servitisation is made easier for you because it enables you to monitor the performance of your assets remotely.

Maintenance and monitoring of assets were traditionally very expensive and time-consuming until the arrival of intelligent software that makes work easier and cost-effective for manufacturers. FieldElite uses advanced learning algorithms to remotely automate the entire process, allowing you to detect, in real-time, the performance and need for maintenance on your asset.

Required Organisational Changes

A few important steps include;

Companies that invest in continuous training and development always have a more competitive edge than their counterparts. Meaning an important step towards servitisation is training the workforce. This is important, considering that the company structure, focus, and process will have to change.

Set up a team that is focused on the challenge, change, and creation. With this, you can easily adjust to industry changes. The team should always work on knowing what should be adjusted and when it should be.?

In the shift to servitisation, adopting a comprehensive service technology is an important step. Such service technology software includes FieldElite. This technology will ensure that you’re able to monitor your product in real-time, meaning you can maintain good performance for as long as possible.

Because servitisation essentially focuses on the customer, take time to study customer behaviour. Knowing what your customers need and want will help you remain relevant in the industry.

Conclusion

As the demand for more benefits and long-lasting relationships with dealers grow, so is the need for manufacturers to adjust. Hence more and more manufacturing companies are leaning towards embracing servitisation as a solution to the growing demand.?

In turn, manufacturers who’re attaching service contracts to their product sales are making more than those who remain stuck in the traditional approach to sales.?

Essentially, servitisation will ensure that, as a manufacturer, you remain relevant to your customers now and in years to come. This is a much better arrangement in terms of saving costs and making more returns. Remember to be successful, you have to be flexible enough to change with demand.

How Small Irish Businesses Avoid the GDPR Sting

Accountants providing chartered accounting services and tax advice are alerting smaller Irish companies to the consequences of the pending General Data Protection Regulation (GDPR). They believe these are going to feel the most pain come 25 May 2018, if they do not implement GDPR by then. We are trying our best to help avoid this situation by providing advice.

How to Kick the GDPR Ball into Play

The Irish Information Commissioner?s Office has produced a toolkit regarding where?s best to start. They suggest beginning with an information security assessment to determine the gaps companies need to close. Once quantified, this leads naturally to a plan of action, and resources needed to fulfil it. Here?s how to go about it:

1. Start by assessing your current ability to identify, assess, and manage threats to customer data security. Have you done anything at all to date? You must be holding some customer information surely, and it is highly likely the GDPR applies to you.

2. Next, review your company?s current customer data security policies. Are they documented and approved, or do new employees discover them sitting next to Nellie? Rate yourself on a scale where ten is successful implementation.

3. Now consider how well you have pinned responsibilities on individuals to implement policies and take the lead on GDPR. The latter should be the business owner, or a board member with clout to make things happen.

4. By now, you should have a grasp of the scale of work ahead of you, remembering the EU deadline is 25 May 2018. If this sounds overwhelming, consider outsourcing to your accountant or a specialist provider.

5. Under the General Data Protection Regulation you have only 72 hours to report a breach of customer data security to the Information Commissioner?s Office. Do you have a quality assurance mechanism to oversee this?

Tangible Things to Bring Your Own People on Board

With all the changes going on, there is a risk of your employees regarding GDPR as ?another management idea going nowhere.? Thus, it is important to incorporate the new EU regulations in staff training, particularly with regard to data security generally. They may fully come on board only once they see tangible signs of progress. You should in any case put the following measures in place unless you already have them:

1. A secure area for your servers and for any paperwork your customers provided. This implies access control on a need-to-know basis to protect the information against loss, damage, and theft.

2. A protocol for storage media and record disposal when you no longer require them or something supersedes them. You are the custodian of other people?s information and they deserve nothing less.

3. Procedures to secure customer data on employee mobile devices and computers: This must extend to work done at home, at consultant sites, and by remote workers.

4. Secure configuration of all existing and new hardware to minimise vulnerability and storage media crashes. These quality assurance measures should extend to removable media and remote backups.

So Is This the Worst of the Pain?

We are at the heart of the matter, although there is more to tell in future articles. You may be almost there, if you already protect your proprietary information. If not, you may have key company information already open to malware.We should welcome the EU General Data Protection Regulation as a notice that it is time to face up to the challenges of data protection and security generally. The age of hacking and malware is upon us. The offender could be a disgruntled employee, or your competition just down the street. It is time to take precautions.

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