In the fast-paced world of commercial real estate (CRE), the back-office plays a pivotal role in ensuring smooth operations. One common challenge that plagues commercial real estate teams is the reliance on spreadsheets for managing data, transactions, and financials. While spreadsheets are versatile tools, they can also be prone to errors that may result in costly setbacks.
Read ahead to explore how CRE teams can eliminate spreadsheet errors to create back-office efficiencies and boost productivity.
The Pitfalls of Spreadsheet Dependency
Spreadsheets have long been the go-to solution for managing data and calculations in commercial real estate. However, their limitations and the risks they pose cannot be ignored. Below are some of the common pitfalls associated with spreadsheet dependency:
Mistakes Caused by Human Errors
Spreadsheets are highly susceptible to manual errors, such as data entry mistakes, formula errors, and copy-paste blunders. These errors can lead to financial discrepancies and misinformed decision-making, potentially leading to costly outcome
Challenges Maintaining Version Control
Collaborating on spreadsheets can be a nightmare. With multiple versions of a single spreadsheet in circulation, it can be challenging to know which document is the most current, or be able to identify who made which edits, potentially leading to confusion and data inconsistencies.
Data loss can have serious implications for your organization. Losing documents and information requires significant time investments to restore or recover data that is essential to the business. Unfortunately, 94% of companies that experience severe data loss never recover; another 51% of companies close within two years of the data loss. Spreadsheets offer limited security features, making them vulnerable to data breaches.
As your business grows, managing data in spreadsheets becomes increasingly complex. Expanding portfolios and more intricate financial models can quickly outgrow the capabilities of spreadsheets which can lead to bandwidth issues across your team.
Lack of Automation
Spreadsheets lack the ability to automate repetitive tasks, like data entry, resulting in a time-consuming manual effort that could be better spent on strategic decision-making.
The Solution: Transition to Modern Entity Management Software
To overcome challenges and boost back-office efficiencies, like creating scalable processes across teams, CRE teams should consider embracing an entity management software, like EntityKeeper. Here’s how an entity management tool can help:
Today, over 60% of workers estimate they could save 6 or more hours per week by automating data entry; and over 40% of workers spend at least a quarter of their work week on manual, repetitive tasks like data collection and data entry. Outdated processes and manual tasks take up hours of time and budget that could be reallocated to more value-add activities.
Entity management software automates the processes, like data sharing and annual reporting, that slow your organization down. Automating these tasks improves and builds confidence in the firm’s operations, boosting both efficiency and effectiveness.
Complex Org Chart Creation
Every organization should have a formally-documented structure that clearly represents information such as investors, shareholders, and stock classes. But manually creating and updating complex org charts is both inefficient and unscalable.
Entity management software simplifies building and maintaining org charts using the data in your account and automatically updates to track changes in ownership structure.
Steps to Adopt Entity Management Software
Perform a Back-Office Assessment
Begin by assessing your current back-office processes and identifying pain points related to spreadsheet usage. Determine the specific software requirements to address these issues.
Identify and Compare Entity Management Tools
Research and select an entity management solution that aligns with your business needs. Consider factors such as scalability, user-friendliness, integration capabilities, and customer support. Plus, EntityKeeper offers corporate services, including registered agent services. When comparing entity management tools and providers, consider a partner who provides additional services to help your firm achieve your entity management goals.
Prepare for A Data Migration
Migrating data from spreadsheets to the new software can be challenging but is essential for a seamless transition. Ensure that your chosen software supports data import and has an implementation team to assist during this process.
Get Your Team on Board
Train your team on using the new software effectively. Provide ongoing support and resources to help them adapt to the change smoothly.
Seek Opportunities for Back-Office Improvement
Continuously monitor and evaluate your back-office’s performance. Seek feedback from your team and use your entity management software to make adjustments and optimize your back-office operations.
In the competitive landscape of commercial real estate, eliminating spreadsheet errors is crucial to creating efficient back-office operations. Adopting entity management software not only mitigates the risks associated with spreadsheet dependency but also empowers your team to focus on strategic decision-making, scalability, and enhanced collaboration. Embrace the change, and watch your commercial real estate business thrive with error-free, efficient back-office processes.