Danielle Stein Fairhurst has built a niche business using Excel for financial modeling. She’s the author of three books on the subject, one now in its third edition and one part of the popular For Dummies series. Her website, Plum Solutions, provides online training, workshops, in-house training and even meetups for Excel fans and users. She talked with us recently about why Excel is the Swiss Army knife of software.
This interview has been edited and condensed.
How did your Excel journey begin?
I started my career in investment banking in London, and that was really where I started using it because that’s what everybody used. I’ve built my career around the use of Excel because it’s just such a ubiquitous tool.
Tell us a little bit more about the notion of building your career around Excel.
It was something that came very easily to me, and then I realized that my skills were quite good in comparison to others. I started training and consulting on the use of Excel in financial modeling, probably way before anybody really called it financial modeling, and for building solutions and techniques.
I was building business cases, pricing models and doing a lot of budgeting, forecasting, project analysis, projections and management reporting.
I offered short courses on financial modeling and quickly found that it’s quite hard to teach this concept without teaching Excel skills as well. It’s difficult to build a good financial model if you don’t have top-notch Excel skills. A lot of my training materials were about how to use certain formulas and techniques in Excel to build financial models. That led to the writing of my three books.
Who are the people coming to you for financial modeling help?
I do some travel and training courses. But the rest of my time I spend going into organizations and helping them build or check financial models. Sometimes they are professional modelers who don’t have the time or bandwidth to check their models. Often they are business professionals or senior managers in a variety of different industries who don’t have the skills in financial modeling.
Financial modeling is a skill that lends itself very well to outsourcing. People know enough Excel to get around, but they don’t necessarily need the skills to build a model from scratch. It’s very similar to building your own website. You don’t need to learn how to build a website; you just get someone to do it for you. But you need to be savvy enough to make basic changes and to know when something isn’t right.
What is it about Excel in terms of its construction or its features that make it an optimal choice for this kind of work?
It’s so flexible. We call it the Swiss Army knife of software. It can pretty much do anything.
However, just because you can do something in Excel doesn’t necessarily mean that you should. And that’s the problem. In my training, I talk about reducing the possibility for errors because it’s just so easy to make them, and for many, it can be terrifying that there’s the possibility of a mistake in their model.
The reason we use Excel is that it’s so ubiquitous. Everybody has it, and everybody has Excel skills in varying degrees. It certainly does the job as long as we are careful about avoiding errors in our models.
What’s been transformative for you or your clients in terms of what functionalities Excel has now?
I’m excited about a lot of the new features. Power BI is not a modeling tool, but for dashboards and that sort of thing, it’s great. Power Query is fantastic for getting data and manipulating data.
What’s problematic about Excel?
I’m always having trouble with versions. In fact, I ran into some problems with a project I’m working on because I used some functionality that was not compatible with Mac. So I had to rebuild parts of the model. You always have to be aware of who’s going to be using the model, and often it’s going to look different on their version of Excel versus my version of Excel because I’m running the latest and I want to use the cutting-edge tools.
In looking at your website, there is a breadth of content delivery and segmentation. You have a section on Excel for executive assistants, for example.
We realize there are different types of people who are using Excel for different reasons. We focus on mid-level finance people because there’s such a massive market for it there.
But, of course, I love running face-to-face trainings. My absolute favorite thing in the world to do is to run an in-house training course with 10 or 15 people who are passionate about Excel, are working through their problems together and upping their skills for the problems that they face in their every-day work.
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