Far too often sales organizations use spreadsheets to manage commissions. The problem is that 88% of spreadsheets contain errors — it breaks down to an error in every 20 cells. That’s how your worst work nightmare begins. It’s why you need a sales commission software solution, like Core Commissions. It even helps you get a better night’s sleep.
Over the last couple of decades, several high-profile incidents occurred as a result of excel errors. Everything from ridiculously overbooked events to huge financial losses originated from a simple spreadsheet error. Here are just a few of the scary spreadsheet horror stories.
A spreadsheet error resulted in a $6 billion loss while a hidden column forced a bank to buy assets they didn’t want.
Spreadsheet Horror Stories:
- The Typo that Nearly Sunk the 2012 London Olympics: Thanks to a spreadsheet debacle, an Olympic swimming event got overbooked by 10,000 seats! Reportedly a staffer’s finger tapped the wrong number on a keypad, inserting 20,000 into a cell that should have read 10,000. The mistake was caught before the actual event but the tickets had already been sold. Unlucky customer service reps had to make about 10,000 phone calls to ticket holders and deliver the bad news just before Christmas.
- Cut-and-Paste Cost JP Morgan Chase Over $6 Billion: In what’s become known as the “London Whale” incident, a value-at-risk model suffered a pretty major error. A London-based contractor built the model manually using Excel. Part of that model required cutting-and-pasting data from one spreadsheet to another. This probably happened repeatedly. A mistake in one of the original versions was never caught so a few figures were divided instead of averaged. It escaped review long enough for the bank to lose more than $6 billion in trading.
- Hidden Column Forced Barclay’s to Buy Assets They Never Intended To: In the process of converting a spreadsheet to a PDF, a couple lawyers accidentally hid a column. Those lawyers were working on a contract for Barclay’s as part of the process of acquiring assets from Lehman Brothers. The hidden column included 179 contracts that the investment bank didn’t intend to purchase. But without that info, they bought them anyway. The company filed the paperwork with the court and ended up on the hook for all those contracts anyhow.
- MI5 Bugged 1,000 of the Wrong Phone Numbers: It was another formatting error that lead the British intelligence agency to bug more than 1,000 of the wrong phone lines. In 2010, a spreadsheet error surfaced every phone number that ended in ‘000’ instead of the actual phone numbers the spies were investigating. When they finally noticed their mess up, the agency destroyed the information collected. They also had to fix the spreadsheet and put additional processes in place to prevent that from happening again.
- Eastman Kodak Had to Restate Financial Results for Two Quarters: Once considered a financially sound company, film maker Eastman Kodak experienced massive losses in recent years. The rise of digital cameras and other film-less recording tools made the company somewhat obsolete. But in 2005, the organization released financial reports for two quarters that didn’t seem so dire. That is until they realized someone had made an error in Excel. Eventually the company discovered that too many zeros had been added to an employee’s accrued severance. Once corrected, Eastman Kodak had to add $9 million in losses to their previous reports.
How to Eliminate Errors:
The answer is simple: Stop using spreadsheets. Immediately. The manual processes that go into populating, calculating, and even converting these documents open your organization up to any combination of errors.
Instead, employ a reliable commission solution that not only automates the calculation process but can help you catch errors before they’re a problem. With Core Commissions, your administrator can more easily recognize and correct mistakes. They also have the ability to easily audit results and look for patterns. With a single click of a button, auto-generated individualized reports go to every payee. Additionally, a number of other types of reports are available through our application.