- ‘Citizen tech’ is the new trendy phrase for ‘shadow IT’.
- Ian Bennett FCA says citizen tech can help solve problems, is inevitable and should be wholeheartedly embraced.
- Have a financial modelling question you’d like help with? You can ask Ian.
In the past few editions of Acuity, I have covered a number of topics relating to best practice in creating spreadsheets and financial models. Hopefully these articles have started to build a picture of how to approach building a great model, the benefits of new modelling technologies, what good habits to form, and what high-risk things to avoid.
It has been a pleasant surprise to find so many readers filling the inbox with financial modelling related questions too pressing to ignore. In response, I have introduced a new question-and-answer format. I look forward to receiving more of your questions and the opportunity to administer vital spreadsheet first aid.
One such question I received recently was: What is ‘citizen tech’ and how does it relate to financial modelling?
I’m guessing you didn’t hear this term from your IT department. ‘Citizen tech’ is the new trendy phrase for ‘shadow IT’, which was coined by IT departments as a scary new term for UDAs (User Developed Applications) or EUC (End User Computing).
Ten years ago this meant Excel spreadsheets and Access databases (remember those days?). Now, it means any technology that is created and owned by the business and not the IT department, for example Excel, VBA, Power Query, Power Pivot, Power BI, Google Sheets, Google Data Studio, Tableau, R, SQL, Anaplan, Adaptive Insights, Jedox.
This used to be a thin layer of Excel analytics wrapped around your IT systems, but now Excel has company, and the potential of all these tools means the business (citizens) are taking over the technology.
In 2017, Gartner research predicted that 38% of technology purchases in that year would be managed, defined and controlled by business leaders. IDC (International Data Corporation) predicts that by 2020, in the majority of the industries it surveys, line-of-business technology spend by non-IT sections of organisations will be greater than that of IT departments.
With tech-enabled analysts arriving in finance functions every day, the use of powerful citizen tech to quickly solve problems is inevitable and should be wholeheartedly embraced.
These people with their new technologies will open your eyes to new potential. They have an agile mindset and they’re prepared to experiment with multiple technologies to find the best approach. Without realising it, they create platforms and tools that sit within the platforms.
Embrace it yourself, because you’d be surprised how much your own thinking is constrained by the limitations of Excel. If you can free yourself from questions such as: “is that more data than Excel can handle?”, “will Excel calculate too slowly?”, “will I have inputs multiple times?”, then you create better solutions.
Your questions answered
Have a financial modelling or spreadsheet question you’d like Ian to tackle in an upcoming issue of Acuity? Send it to [email protected] with ‘Ask Ian’ in the subject line.
Ian Bennett FCA leads PwC Australia’s deals modelling team and has more than 17 years experience as a professional financial modeller.