New: AI Agent in Excel

The AI world is moving FAST because we now have AI agents in Excel.

Well, sort of. You have to have the paid version of CoPilot in Microsoft 365 and add it as an Excel add-in. Then you can explore it on the web browser.

Please note, I did not say on the desktop app.

But…once you get it going, it does appear amazing.

Backstory

So…I’ve been working on a project for someone. She approached me with an idea to develop a financial product on Excel. Now, this person has more of an IT background, business analyst, and some desktop work, so I was a bit confused. But also interwoven within was a sense of helping people so that aspect is probably what is coming forth. Maybe this person has clients that appears to need some personal financial help.

I don’t know but I was asked to help create the financial product and was given a prototype found out on the web, the free version.

There’s another way of looking at this project which came out after our initial discussion and that was this spreadsheet could be a demo for what we could do with Excel.

This project involved some financial calculations and there was one in particular that was a bit convoluted. When working with it, I knew in my guts that the formula would end up being very hairy and complicated. Last Thursday, I ended up creating a workaround which I thought was very nifty: instead of asking the user to do an interative approach to get at an answer, I devised a “spinner” approach. The “spinner” approach involved pressing and holding down an Excel button to have the spreadsheet run through the numbers, enter those numbers into the formulas, and watch the results pop up. This was not a macro.

I thought the approach was nifty but still clunky.

So that was last Thursday in the morning.

Then came lunchtime and world got upended

I was scrolling through the YouTube feed to find news about the weather forecast for the Atlantic – it’s that time of the year where I have to watch out for the hurricanes.

Within the feed was a video titled “Excel AI Will Replace Finance Teams by 2026—Here’s Why (And What to Do)”. This was from a guy who was usually pretty calm. I think he is an engineer who probably has done some project management work.

Okay, according to his website, he has led product teams and has developed AI stuff at Amazon.

Anyway, that video introduced me to the new AI Agent in Excel although he was talking about Claude’s capability to manipulate Excel.

Manipulate Excel…not give analysis or how-to. Theoretically, it was could literally create a model based upon your prompt. Need an income statement? It should be able to do it. Create a budget? No problem…in theory.

Microsoft, probably in conjunction with Anthropic (maker of Claude), also has come up with an AI agent for Excel. Again, you have to have the paid version of CoPilot, you have to added it as an add-in, and you have to work it through the web browser, not desktop app.

I watched the video, went “holy cow!” and thought I have to explore this.

Later that night…playing with AI agent in Excel

That night, after all of my meetings and such, I was ready to play. I already had a test in mind.

That formula that I couldn’t develop very easily earlier in the day.

Once I added it through the Excel add-in, I powered up the spreadsheet in the web browser and set down my prompt as a query to build the needed formula.

Six or seven minutes later, I had the formula.

It confirmed my gut feeling that the formula would be complicated. It used the LET function which is new to me. LET allows you to form variables to use in the formula only within LET. LAMBDA allows you to create a function that can be used by other functions. That is the distinction.

This LET formula had numerous variables.

I tested the formula and it worked! Holy cow!

The next step (which admittedly was a few days later) was to have it create the model itself (not just the formula). That was done around 5 minutes.

Now, there are some tweaking that is necessary because the initial seeding is important. I would have to do further prompting to get some minor details tweaked to what it should be.

But…for the most part, the model appears to be appropriate.

My thoughts on AI Agents in Excel

I have to do a LOT more testing to see how good the agent is in creating valid models, but initial impressions are positive and scary.

At this point, I do believe you have to have some expertise in whatever domain you are in with the spreadsheet. So, if you are doing financial stuff in the spreadsheet, you will need to have some expertise in that financial stuff so you can properly direct the AI agent. You have to know the stuff in order to catch when it goes off the rails.

For the stuff I was doing, someone would have to have some financial knowledge to understand the formulas it was creating and then judge whether they were correct.

As a matter of fact, out on the web there were a few free versions of what I was trying to do (yeah, I know…why is the person trying to create these spreadsheets as products if there are free versions out on the web?) and they all came up with different answers for the same inputs. The answers were in the ballpark of each other, not the same exact numbers. You have to understand this.

At present time, expertise will still be important.

The other “skill” AI experts say you will need is judgement; AI does not have good judgement.

Good judgement? Ha!

Okay, I have to say, most people don’t have good judgement. We can see it around us everyday. Here are my examples from my experience:

• A CFO did not have the good judgement to recognize government contract terms did not dictate commercial contract terms. And yet he demanded that revenue accruals for commercial projects be done the same way as the government contracts.
• A CPA did not have the good judgement to recognize that just because we have an agreed contract that we would do the work, if the work had not been done yet, we could not accrue the revenue.
• The financial team did not have the good judgement to keep the accounting project structure simple but instead creating hundreds of codes to track.
• A CFO did not have the good judgement shell out money for capital infrastructure upgrades. Customers recognized aging computer hardware infrastructure and left. Company imploded.

There are countless examples of poor judgement.

We may be marginally better than AI.

What does it mean for finance?

My sense is that you will have to level up on your set of skills for finance. You have to know basic finance and then level it up to include storytelling, persuasion, strategic thinking, and business partnering.

It will not be enough to be spreadsheet monkey, even a good one that can automate things.

Because the AI agent can do better.

You have to get into future casting, scenario planning and strategic thinking. Which most finance don’t get to do.

I think there will be fewer finance people but with sophisticated skills.

How many of us can do that? What will become of the rest of us?