In this episode, we uncover the shocking truth that spreadsheets secretly run the world, and nowhere is this more evident than in global supply chains. Through interviews with a supply chain leader who’s seen the pros and cons of spreadsheets firsthand and a consultant who helps companies see the potential of new technologies, we explore how these digital grids became commerce's invisible backbone and why the AI-powered future means it's time to break up with our beloved rows and columns.
In this episode, we embark on a detective story to uncover how rows and columns became the invisible backbone of commerce—and why that's both amazing and terrifying. We meet Natalia, a supply chain professional who shares a spreadsheet before-and-after story that’s a real glow-up. Then we meet Chris, a managing director at Accenture who's helped companies pivot from drowning in cells and formulas to making productivity gains as AI-powered innovators. As we journey from copy-paste disasters to AI-powered futures, we discover that while spreadsheets gave us the world as we know it, getting the world we want will require breaking up with static cells and evolving to intelligent systems.
Guests:
Chris McDivitt, Managing Director, Accenture
Natalia Sawka, SAP S4 HANA Venture - Process Manager of Plan to Manufacture, Infineum
Articles mentioned and additional resources:
Making Autonomous Supply Chains Real - Accenture
Spreadsheet errors can have disastrous consequences, yet we keep making the same mistakes – The Conversation
Two-thirds of companies consider Excel a supply chain system – Supply Chain Dive
Twelve dudes and a hype tunnel: Scenes from the ‘Super Bowl for Nerds’ – The New York Times
Credits:
Introductory sound clip from “Full Project in Excel | Excel Tutorials for Beginners” by Alex The Analyst is licensed under CC BY 3.0.
Production by Josh Caldwell
Additional support from Carlos Gama, Suhas Sreedhar, Stefanie Gordish
Clip: “We can go to. Uh, ba ba bum. Where is it? Right here? We’ve got Remove Duplicates. We're gonna click on that.”
Sarah Harkins: That sound you just heard? It's the rush of global commerce. The beating heart of our healthcare systems. The foundation of government operations. It's a spreadsheet. That's right. The humble solution that first debuted over 40 years ago is still central to modern life. They help us keep records, analyze data, and simplify business processes. In a world where technology is constantly evolving, you have to wonder, why? What is it that gives spreadsheets their staying power? And if they're so enduring, then how much of the world actually runs on spreadsheets?
This is Trade Secrets, a podcast from Kinaxis where we ask big questions about our world and find surprising answers by following the hidden networks that connect everything: supply chains. In this episode, we're pulling back the curtain on the spreadsheet empire that keeps our world turning.
How vast is this empire? What all does it do? And how is it helping or hurting how we live and work?
To understand how we began to divide the world into rows and columns, we have to go back to the ‘80s. At that time, digital spreadsheets, the progeny of centuries-old printed ledgers, added functionalities like formula building, making them similar to the tool we still use today.
These applications became widespread as they were packaged with the personal computer, and nothing has dethroned them since.
Chris McDivitt: “Excel has been around for really for three reasons. It offers incredible flexibility, accessibility, and controls, and it just allows for supply chain practitioners to do custom analysis without any IT involvement. So that is attractive.”
This is Chris McDivitt, a managing director at Accenture, and the global solution lead of autonomous solutions. He's familiar with the way spreadsheets support basic operations through his work with global supply chains. You see, accountants and analysts may get most of the credit for the prevalence of spreadsheets in our world, but supply chain professionals deserve recognition too.
Surveys have found that anywhere from 65 to 80% of supply chain professionals use spreadsheets. So, to understand how vast the secret spreadsheet empire really is, let's introduce the Global Spreadsheet Index, a running tally of how many spreadsheets we think are active in the world.
If we assume all financial analysts, accountants, auditors, and two thirds of all supply chain professionals in the US have at least one spreadsheet to their name, that’s over 2.1 million people, according to the Bureau of Labor Statistics. So, our Global Spreadsheet Index sits at 2.1 million if we account for one nation. But global estimates suggest that there are anywhere from 700 million to 1 billion people who use spreadsheets daily. That's a lot of spreadsheets.
What does that daily usage look like?
Natalia Sawka: “It would always start with receiving a demand at the start of the month and then having to manually do very simple but repetitive math for every single SKU. This is Natalia Sawka of specialty chemicals company, Infineum. Her company ended its reliance on spreadsheets long ago—more on that later—but her story represents typical spreadsheet usage across supply chains.
“If there were a hundred SKUs in my planning network, I would have to do it for a hundred of them. Of course, practically, you don't have time for that. So, what I would do, what others would do, you spend time on preparing those Excel sheets with those basic calculations for your most important SKUs and then the other ones you kind of wing it. They kind of plan themselves.”
To recap, Natalia's job was to use spreadsheets to balance supply and demand, except that the process itself often got in the way.
NS: “I was on the call with a procurement department and I was sharing my screen and they said, ‘Wait, you have to do all of this manually?’And I said, I was like, ‘Yeah, yeah.’ And to me, you know, I was so focused in the mode of just keeping it going. It was like, ‘Yes, yes.’ And they were like, ‘Wow, that is just very repetitive and, and so much manual work.’
That's not the type of usage you would expect to see for an application that's lasted decades. But Natalia's usage wasn't unique.
NS: “I said, why don't we count the Excel sheets throughout our organization, the official ones that we use from running S&OP step one to S&OP step five? And that's when we counted 265 Excel sheets. That doesn't include the Excel sheets that colleagues used to do their simple math, right? And by the time you total those up, that number would probably be a lot larger.”
So let's do some simple math of our own to update our Global Spreadsheet Index. Let's take 200 spreadsheets multiplied by, let's say, 500 companies—sort of like the Fortune 500—and that gives us roughly 100,000 spreadsheets. That's just for global supply chains. Sure, it's hardly a blip on our Global Spreadsheet Index of 700 million to 1 billion spreadsheets, but it's impossible to know the actual number because, as Natalia's story illustrates, spreadsheets are disconnected, individualized tools that quickly proliferate across an organization. And that's part of the problem.
Clip: “Breaking news tonight. A spreadsheet error is the cause of a public health scare that's impacting…
…A 10 and a half million dollar typo. That's the cost for one company after someone entered the incorrect…
…A massive privacy breach is being blamed on hidden rows…”
Mishaps of this magnitude illustrates some of the challenges inherent to spreadsheets: they rely on accurate inputs, manual entry, and an understanding of the solution’s limitations.
That's a big problem because studies show that anywhere from 90 to 95% of business spreadsheets with more than 150 rows have errors. If we think back to our Global Spreadsheet Index, imagine at least 600 million of them having errors.
But the biggest problem, the one that might go unmeasured, is the missed opportunities.
NS: “I happened to experience a major supply disruption when we were still working with Excel and legacy planning tools. We had a disruption of a product which we shipped to Japan, Singapore, France, and Italy. I had to create a supply demand balance for every single one of those locations on Excel sheet.
We're back and forth emailing that Excel sheet being modified between myself and the site for production, and that's just like one SKU site combination. And when the crisis happened, it was, if I'm not mistaken, close to 40 of them. So, I did that for 40 of them, just not to run out our customers, basically.”
And when a company can't respond quickly to a shift in demand or supply, those ripple effects multiply quickly. Anyone remember toilet paper shortages during the pandemic?
But as we mentioned earlier, Natalia and her colleagues are no longer working in spreadsheets. They have a new tool that connects disparate processes and automates calculations.
NS: “It's like the Apple of supply chain software. The way it all integrates together is very thought-through, and the user is very impressed by that interface because it's smooth. It's easy to navigate. So, you can pull up a workbook that calls out the areas where you are experiencing higher demand than you planned for and it automatically will highlight when your safety stock will go below target and it automatically will propose additional planned orders to avoid that pinch point.
So, you know, you move from this number crunching mode in Excel to actually managing and optimizing your supply chain and having those value-add conversations between your business functions, and this is only the beginning.”
Imagine if our estimated 200,000 supply chain spreadsheets were migrated to similar systems. What would be possible if each of these people shifted from number crunching to optimizing?
CM: “We're in a very pivotal moment in supply chain history. Excel has been a remarkable tool, but I think its limitations have created a ceiling on what's possible. And now with the combination of genAI, multi-agent systems, a modern data and knowledge layer, we can finally break free from spreadsheets’ limitations.”
This is the future for supply chain planning and other data-heavy sectors. Instead of manually running hundreds of calculations, planners will have conversations with their systems through genAI while in the background, predictive AI will process thousands of variables and learn from patterns. And when these systems are connected to AI agents, they can work independently to optimize outcomes and execute commands. Consider this:
CM: “Let's just say for example, you have a new tax law, that tariff is coming through, which is what we're looking through today. You may have to have changed all of the fixed deterministic workflows to account for those tariffs in today's world. In the agentic world, what you do is you create a new agent or adjust an existing agent, and you update that agent with the new tariff law information.
As you're going through the process, it’s going to start asking questions like, does the original country have special care of considerations? What's the declared value? How does the new tariff law apply? So, as the process is executing and the agent is pulling from the latest information, it's learning from the responses that you're applying. This is very, very different from what we did before.”
While this technology is still in the early adoption phase, its potential is transformative.
CM: “We've done research that has shown that on average it takes about 145 days for a supply chain to recover from a demand supply disruption, right? Industry leaders that have started to get on the agentic AI journey are now recovering from a disruption in 34 days versus 45.
We've seen organizations put in their business cases labor productivity as high as 40%. We've seen that the ability to reduce process complexity is 7x and then if you think about doing the same work in less time—that level of speed and agility—then in turn what you're doing is, is you're establishing a more resilient supply chain.”
If you're wondering what happens when you stop manually running calculations, fear not.
CM: “If you think about just the work. You go from a reactive to a very proactive mindset. You pivot from serial to parallel processing. Planning cycles will collapse. It will create more of a collaborative decision making environment, and you focus on strategic decisions versus handling exceptions.”
While Natalia isn't working with AI agents yet, she has already seen the potential in more connected, automated processes.
NS: “It's truly a different way of working because that preparation work has been done for you by the tool. So now, you move into the management mode of it. You start anticipating more collaboratively with your business.
And that's how you want to run a company, to maximize that profit by effectively managing your pinch points, by anticipating opportunities to really grow. Otherwise, you're a bit stuck in that manual preparation mode just to keep things running.”
As businesses adopt these AI capabilities, Chris predicts most employees will pivot to focus entirely on strategy and optimization.
CM: “You'll have agents that will alert you to that disruption or that event and do so much more than what we know of as control towers today. That's going to allow for additional role types, such as supply chain intelligence engineers, that will really design and train and work alongside these agent based systems.”
If the predictions of futurists and AI enthusiasts are correct, then we may be relying on AI for many job functions in the next five to 15 years. But to get there, our data has to come out of spreadsheets and into more flexible, collaborative formats. That means our 40-year collaboration with digital ledgers is nearing its end.
As you return to your desk after this episode, take a moment to count your own spreadsheets. Ask yourself. What would be possible if you weren't constrained by rows and columns? How much more efficient, collaborative, and resilient could you and your business be? The spreadsheet empire has served us well, but perhaps it's time for a new era, one with a Global Spreadsheet Index of zero.
Thanks for listening to Trade Secrets, a podcast from Kinaxis. Special thanks to Chris McDivitt, Natalia Sawka, Carlos Gama, Suhas Sreedhar, and Josh Caldwell.
If you're interested in learning more about AI agents, spreadsheets in supply chain, or just supply chains generally, you can visit the links in our show notes.
And one last thing: while spreadsheets may not be used in the office 10 years from now, they still have a bright future in eSports. The annual Microsoft Excel World Championship asks competitors to solve spreadsheet puzzles for prizes. It even gets streamed on ESPN.