Excel & VBA projects: Hiring consultant vs sourcing internally
Whether you are planning to repair legacy Excel sheets, automate reports, or reorganise analytical processes, one question persists. Should you commission the project internally or seek for the help of an Excel Expert for hire or VBA Developer?
This article will provide you with a framework to identify relevant dimensions to weight the pros and cons to make the right choice.
Is it only about the hourly rate?
The rule of thumb is to choose to outsource when it is less costly than doing it internally. This, however, gains complexity when you accurately define and relate the cost to the acquired benefits.
Not in the narrow understanding of value, but value-added perspective.
Simply put, your pros and cons balance sheet should not only include the retainers you pay to VBA Developer but also the value of business/time lost while waiting for the solution, impact of potential errors, suboptimal functionalities. You want to accurately lay them out for an Excel Consultant and an internal source. Here are the major dimensions.
Hiring an Excel or VBA Consultant you would get billed for a project which is often associated with a volume of work in hours or working days. Most of the times the hourly rate of your Senior Finance Analyst or Manager would be lower than the consultant's, but the same goes for the efficiency.
Plus, you would often be able to lock the price and get a more accurate ballpark estimate for the development time, separated from business-as-usual work.
Sometimes the short deadline might force you to increase the bandwidth and get the VBA Developer working asap without the time to upskill Excel competencies of your colleagues. That is especially the case if some workbooks stopped working properly or if you quickly need to adjust your analytics to operational or regulatory changes.
Time to hire
If you decide to do it internally, you may either choose a current employee or announce an opening for an Excel Modelling Specialist role. Hiring takes time, and unless you need to retain technical experts in-house, it will not justify the cost of a new position opening.
Similarly, if the development of the new tools is added to the "to-do" portfolio of the Finance Team Leader, that might hinder their specialisation in the core domain.
Analytical vs Domain complexity
Projects stretch on the spectrum from purely technical to domain-specific. Some require VBA coding to create intelligent systems for creating a PowerPoint presentation. Other use relatively simple formulae but utilise an abundance of expert knowledge like complex probability distribution concepts in insurance or duration and convexity measures for investment analysis. Consider the balance between the two to determine whether you need a developer or subject expert. Or both.
Company-specific vs general industry
Sometimes you might need a long induction to the models you use. It may seem like it wouldn't be worth to introduce them to someone external, but... Unless your average employee tenure is over five years and your People Director is on the cloud nine, you have to make sure the systems are easy-to-grasp for the newcomers. It might be best to cut the Gordian knot before it is too late.
Knowledge retention potential
If analytics is what you sell or your systems need constant retuning and adjustment, you have to retain full ownership of them. If you are not developing them internally, remember to request or purchase the access to the VBA code and get the passwords to protected formulas and sheets. You might also plan training for the internal system owners and present the mechanics of the models as part of the induction week.
Repeatability and company size
If you re going to use something occasionally and it is not your primary area of business or source of competitive advantage, you do not need to know everything about it. Also, it makes more sense to outsource than to hire someone for one day per week if your company is not a big multinational.
Benchmarking analytical frameworks
External Excel consultants might also be able to evaluate the fitness of analytical frameworks you are willing to use. Maybe the tool you are using is an overkill? Perhaps you are missing some easy-to-implement features that are industry standard and bring extra value? Or maybe there are risks you have not thought about?
Cost and impact of error
What is your tolerance for errors and how costly they could be? Can they damage your reputation, stop critical processes, or trigger legal consequences? It is shocking how much some spreadsheet errors costed some firms. Depending on the answers, you might want to protect your organisation against adverse effects more thus involving experienced Spreadsheet Experts.
Testing needs and capabilities
If your pricing model produces the right outputs, that is great. But does it have appropriate complexity to capture what is relevant and not waste your time on unnecessary functionalities? Has it also been tested by the end-users?
Whether you have internal VBA Macro Developers or hired Excel Consultancy to help you, have you considered what level of customisation you need to satisfy the end-users?
- Do you need a one-fits-all system?
- Do you need four significant templates and six additional features you can tick or untick?
- Or maybe your Logistics Manager must gain full ownership over the Fleet Management template to be able to modify it frequently?
Conflicts of interest
The stakeholders of an Excel & VBA development project would often be subjected to the goals and KPIs that may not be aligned with the project objectives. Not everybody is keen on learning new things, changing the make-up of their daily work tasks. Also, not too many people prefer complex, but robust solutions over time-consuming, but known and simple.
Quite often, the system user would focus on their comfort of work. Their manager would focus on team performance and how often their review is required. The department head or COO would be more focused on scalability and compatibility of output between the teams.
And People Director would prefer stable systems that do not require employees to constantly work on the weekends resulting in resignations. It is challenging to detach oneself from their perspective, and very often the involvement of an expert external to the operations solves that problem.
Voice of customer
The power dynamic between a Manager and their subordinates might inhibit the valuable input of the system end-users. They might be reluctant to admit that the systems are not user-friendly enough or use too many workarounds, especially if they were created by the Department Director before their promotion.
If you hire somebody that has broad knowledge and experience, they might identify potential risks that are essential to prevent. Think of security concerns, file access levels (i.e. payroll data, company trade secrets, sensitive employee, and customer data, etc.), data storage, version control.
Very rarely would you need just a static tool or a fixed template. And usually to understand the right balance between customizability and simplicity is, you would have to have created many such tools.
There is no process change without proper documentation. If you get just a tool delivery, it's a DYI venture instead of a change project.
Once you have what you need, why not to spend that couple of hours on training to save the days or weeks of trial and error in the future? Whether you are commissioning an internal or external Excel specialist to conduct the project, remember to remind them about the implementation as well as documentation and user training.
When planning an Excel or VBA project, make sure to consider its full impact on your company.
When it comes to time, think of how soon you need it done and whether you have the internal resources, plus how efficient their development work would be.
Reflect on whether the project presents a learning opportunity that will benefit the company in the future.
Think of how often similar project will occur to know if it makes sense to accumulate the know-how of the solution development.
Choose the right level of complexity or ask an Excel Business Consultant for their advice.
Seize the opportunity of future-proofing your operations with error prevention, documentation, and user training, so you will not lose your know-how if some employees leave you or retire.
Include people that are not direct stakeholders and would not have biased approached dictate by their interest or conflicting with the KPIs set for them.
This article is a part of the article series, uncovering how to use the full potential of Excel & VBA macros to make work efficient and drive user-friendly automation. Read this eye-opening guide to check if Excel use is the elephant in your (conference) room not getting enough attention.
It contains helpful graphics, calculators & even GIFs with VBA macros in action.
Michael Sena.The founder of SENACEA – MS Excel & VBA Consulting and Training company, based in London City, operating in the entire UK and online.