Undetected Errors Associated with Spreadsheet Forecasting
The following excerpt from the overview research paper prepared by Professor Raymond Panko, of the University of Hawaii makes for interesting reading.
More detail can be found at http://panko.cba.hawaii.edu/ssr
"All in all, the research done to date in spreadsheet development presents a very disturbing picture. Every study that has attempted to measure errors, without exception, has found them at rates that would be unacceptable in any organization. These error rates, furthermore, are completely consistent with error rates found in other human activities. With such high cell error rates, most large spreadsheets will have multiple errors, and even relatively small "scratch pad" spreadsheets will have a significant probability of error.
Despite the evidence, individual developers and organizations appear to be in a state of denial. They do not regularly implement even fairly simple controls to reduce errors, much less such bitter pills as comprehensive code inspection. One corporate officer probably summarized the situation by saying that he agreed with the error rate numbers but felt that comprehensive code inspection is simply impractical. In other words, he was saying that the company should continue to base critical decisions on bad numbers.
A major impediment to implementing adequate disciplines, of course, is that few spreadsheet developers have spreadsheeting in their job descriptions at all, and very few do spreadsheet development as their main task. In addition, because spreadsheet development is so dispersed, the implementation of policies has to be left to individual department managers. While organizations might identify critical spreadsheets and only impose hard disciplines on them (Panko, 1988), this would still mean that many corporate decisions would continue to be made on the basis of questionable analyses."
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