How to Use Excel for Project Management

Excel may not fulfill every aspect of project management, but it possesses a plethora of potent tools. This guide will help you unlock the potential of Excel for managing smaller-scale projects effectively.

If you have explored the market for project management software, you're likely familiar with the high costs associated with these platforms. These expenses can soar into the thousands annually, enough to give anyone pause. This might lead you to consider leveraging Excel through custom templates—a surprisingly viable alternative. Although Excel is not traditionally advertised as a project management tool, its capabilities for project tracking are impressively robust, often more so than many realize.

So, the question arises: Is an Excel-based project tracker sufficient for your needs, or should you invest in a specialized project management platform? Before you decide, here’s what you should understand about managing projects with Excel. Its versatility and power might be just what you need for your project's scale and complexity, or you might find yourself needing more dedicated features that specialized software can provide.

When should you use Excel for project management?

Should you stick with Excel, or spring for project management software?

It's a tough question -- on one hand, you risk being stuck in the middle of a project with a tool that lacks the advanced features needed to properly execute daily tasks, while on the other hand, you may spend thousands of dollars on software that's more powerful than you need it to be.

When Excel is the best choice

Sometimes less is more. Just because you can purchase fancy project management software platforms out there doesn’t mean you should open up your wallet. Here are a few reasons to eschew those solutions for Excel:

• You’re a one-man band: If you’re, say, a small contractor firm consisting of just yourself or a couple of others, you don’t need a platform that's loaded with features and geared toward large enterprise firms.
• You just want something easy: Even the easiest-to-use project management software platforms have a learning curve. With Excel, you just punch in your task list, materials orders, man-hours, or whatever else you want to track right in the spreadsheet.
• You want to save money: Good software is expensive, costing hundreds or even thousands of dollars per month. That money comes directly from your bottom line, so if Excel meets your needs, you can save a lot of money simply by declining to get specialized software.

When you should use project management software over Excel

As your business grows, you'll find that Excel will struggle to keep up. Here are a few signs that you're reaching the point where you need specialized project management software:

• You have more than a few employees: Once you get past five or so employees, project management software starts to get more valuable. It’s hard to use a spreadsheet to manage a business with a lot of moving parts, so if you started with Excel, you will find as you grow that your projects outstrip its capabilities.
• Calculations are complex: A big problem with Excel is that even a small data-entry error can produce inaccurate results that could jeopardize your project. As calculations become more complex, you need project management software that can automate most of your data entry.
• You’re frustrated by Excel’s limitations: Excel’s primary appeal is in its simplicity, not in its features. If you want a platform that offers extras like job monitoring, bid management, design, and other aspects of project management, graduate from Excel to a dedicated software platform.
• You’re making costly mistakes: If trying to manage everything through Excel is causing you to make mistakes like missing certain deadlines or ordering the wrong amount of materials, you need more powerful software geared toward managing your projects.

Best use cases for Excel project management

Excel’s tools aren’t specifically designed for project management like some software, but it will handle a lot of tasks associated with mapping out the project scope, handling the financials, and managing day-to-day tasks. Here are a few specific ways Excel templates will help with project planning.

1. Timeline

Excel can create a visual timeline chart and help you map out a project schedule and project phases. Specifically, you can create a Gantt chart, which is a popular tool for project management because it maps out tasks based on how long they'll take, when they start, and when they finish.

The timeline tracker features horizontal bars representing each task, and they are aligned side by side to give you a complete picture of your project's schedule and deliverables.

The Excel schedule template and other project planning tools take time to get the hang of, but they allow you to go beyond a simplistic list of deadlines.

Source: https://www.youtube.com/watch?v=xsxi4qaEnOg.

2. Budget

Excel thrives when it comes to crunching numbers, so it is particularly well-suited for creating a project budget. This works best for small to mid-sized projects, as larger projects would outstrip the software's capabilities.

Creating a budget is very easy if all you want is to track a short list of expenses against a list of income. But if you want to go beyond that and create more detailed budgets, Excel can do that as well.

Source: https://www.youtube.com/watch?v=uksHkXFcf-k.

3. Task list

Excel will help you create a task list or to-do list so you can manage your own activities on a day-to-day basis -- or, you can create one for your team each day to ensure your projects stay on track.

The obvious way to do this is to list each task, a description of what is to be accomplished, necessary resources, the responsible employee, and so on. However, you can make the to-do list more dynamic and automated if you're willing to put the time into it.

Source: https://www.youtube.com/watch?v=wEge5na2how.

4. Project tracking

Once the project is set in motion, you can use Excel as a project tracker and manage any issues that come up. Create columns for the name of the project, the task, the manager in charge, duration, progress, budget vs. actual, and so on.

This shows you how close tasks are to completion, what's over budget, and anything else you want to monitor.

You can then use this data to create charts that help you visualize the status and progress of projects so you're not just looking at a set of numbers.

Source: https://www.youtube.com/watch?v=5qtSioTE2wY.

5. Project review

Thanks to all the data you collected, creating customized reports and analytics that will help you break down your performance after the project is much easier. Excel has number-crunching tools that can automatically generate these reports based on the inputs you choose -- which also gives you endless customization options.

It's complicated, but once you learn how to do it, you’ll be able to make educated decisions about future projects.

Source: https://www.youtube.com/watch?v=qPKFlVnzv5c.

Draft a quick project now

The best way to find out if Excel is right for you is to give it a try. Create a quick timeline, schedule, task list, and budget using multiple sheets within Excel to see if the software can manage it. Experiment with creating custom reports. Visualize how the day-to-day would look running a project through Excel.

Then, check out a few of the project management software solutions The Ascent has reviewed. Download trials for software options that interest you, and do a little experimenting to see if a comprehensive project management tool is right for you.

It will take time, but taking these actions will give you a clear picture of whether Excel is enough for you, or if you need project management software.