Why Actuaries Are Transitioning from Excel

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As an actuary, you know the importance of managing large sets of data and making accurate predictions. Excel has been a valuable tool in this process, but as data sets grow larger and more complex, it can become unwieldy to handle. This is why many actuaries are now transitioning to more advanced technologies that can help streamline their workflow and provide more sophisticated analysis capabilities.

Benefits and Limitations of Excel

Excel has been a reliable tool for many years, offering the ability to organize, analyze and make critical decisions with data. It is user-friendly and widely accessible. However, as data sets become larger and more complex, the limitations of Excel can become more apparent. Excel is prone to errors, with larger and more complex data sets. In addition, Excel has limited data visualization and analysis capabilities, making it difficult to identify patterns and trends in the data.

Challenges of Siloed Data

Siloed data is a significant challenge that many actuaries face when using Excel. Data silos occur when data is stored in separate systems, making it difficult to combine data sets for analysis. For example, actuarial data may be stored in separate Excel spreadsheets or databases, and consolidating this data can be time-consuming and prone to errors. Siloed data can also make it difficult to identify patterns and trends in the data, which can hinder predictive modeling and decision-making.

Benefits and Limitations of Excel

Excel has been a reliable tool for many years, offering the ability to organize, analyze and make critical decisions with data. It is user-friendly and widely accessible. However, as data sets become larger and more complex, the limitations of Excel can become more apparent. Excel is prone to errors, with larger and more complex data sets. In addition, Excel has limited data visualization and analysis capabilities, making it difficult to identify patterns and trends in the data.

Examples of Models That Excel Can’t Handle

There are a few models that Excel can’t handle due to increasing complexity. This model requires large amounts of data and complex algorithms, which can quickly become unwieldy to handle in Excel.

Another example is the Neural Network model, which is used in predictive modeling to simulate the behavior of the human brain. This model requires sophisticated algorithms and large amounts of data, which can be difficult to manage in Excel. With more advanced technologies, actuaries can easily work with these models, providing more accurate predictions and insights.

Pathway to Transition

If you are considering transitioning away from Excel, it is essential to have a plan in place. This plan should include the following steps:

By carefully planning your transition and considering various technology options like R, Python, KNIME, and Power BI, you can confidently move away from Excel and take advantage of more advanced tools to improve your workflow and provide more sophisticated analysis capabilities.

    1. Identify areas where more advanced technologies can help improve your workflow and address the limitations of Excel.
    2. Organize your data to make it easier to transition to new technologies. This may involve consolidating data from different sources and ensuring the data is clean and well-structured.
    3. Research and evaluate technology options that best suit your needs. In addition to R and Python, consider alternatives like KNIME and Power BI. These tools offer advanced data analysis and visualization capabilities and can handle large and complex data sets.
      1. R and Python are widely used programming languages in data analysis, statistical modeling, and machine learning, offering powerful analytical capabilities and extensive libraries.
      2. KNIME is an open-source data analytics platform with a user-friendly, visual interface, enabling users to create data workflows and leverage pre-built nodes for data manipulation, statistical modeling, and machine learning.
      3. Power BI is a business analytics tool that integrates seamlessly with Excel, allowing users to create interactive visualizations and reports from various data sources while enhancing their data analysis and visualization skills.
    4. Invest in training opportunities for you and your team to ensure everyone is prepared for the change. This can include attending workshops, webinars, or enrolling in online courses to learn the new tools and technologies.
    5. Develop a timeline for the transition, including milestones and goals for each stage of the process.

    Conclusion

    Transitioning from Excel to more advanced technologies can help improve your workflow and provide more sophisticated analysis capabilities. With the increasing complexity of actuarial data, it is essential to have the right tools and technologies in place to make accurate predictions and informed decisions. By identifying areas where more advanced technologies can help improve your workflow and organizing your data making it easier to transition, you can confidently move away from Excel and take advantage.

    Ready to take the next step in your actuarial data analysis journey? Contact our team of experts for personalized guidance on transitioning from Excel to advanced tools like R, Python, KNIME, or Power BI. We’re here to help you make an informed decision and ensure a smooth transition for you and your team.

    Only then will the silver linings be visible.

    Questions? Call 719-581-2221 anytime to arrange a consultation with either author. Both have spent a decade or more helping associations grow, can share with you what’s worked, and would love your feedback.

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    Preparing your Association for a recession

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    While the economy has been strong in recent years, many experts believe that a recession is on the horizon.

    Trade associations and professional associations may be impacted differently during an impending economic recession. Trade associations may see a decline in membership as companies struggle to cope financially. Additionally, they may see a decrease in sponsorship and advertising revenue as businesses cut back on their spending.

    Professional associations may also see a decline in membership as individuals lose their jobs or have less disposable income to spend on membership dues. However, professional associations may be less impacted by a decline in sponsorship and advertising revenue, as these organizations typically rely more on membership dues for revenue.
    It follows naturally therefore that during a recession, associations may record a decline in attendance and participation in events and programs as businesses show balance sheets with less disposable income, leaving them no choice but to reduce spending on these activities.
    Professional associations will witness a trend where individuals who have been laid off may seek new avenues to improve their job prospects by obtaining certifications or other credentials. This can lead to an increase in demand for training programs offered by professional associations.

    However, it is also important to note that during a recession, this increased demand is often offset by two mitigating factors. First, individuals may have less disposable income to spend on additional training or certifications.  Understandably, their priorities will be on overhead expenses, such as utilities and other necessary expenses. Second, companies may cut back on their training budgets, making it harder for individuals to access the training they need.

    To mitigate the impact of a recession, trade, and professional associations should focus on increasing membership and engagement by diversifying their revenue streams and reducing expenses. Let’s look at both of these measures individually.

    Navigate Through the Clouds with New Revenue Streams In Your Flight Plan

    New revenue streams can come from developing new products or services and seeking out new sponsors and partners to increase non-dues revenue.

    Associations can provide a number of services to help their members steer through a recession and mitigate its impact. Some examples include:
    • Job boards and networking opportunities: Associations can create online job boards or networking groups to enable their members to connect with potential employers or clients. One of the great, yet often underutilized, strengths of an association is the ability to connect people to expertise, in the form of either specialists or documentation. This is something few other organizations can provide nearly as cost-effectively.
    • Professional development and training: Associations can provide online courses, webinars, and other resources to help members improve their skills and stay marketable during a recession.
    • Business counseling, mentoring, and benchmarking: Associations can lay out resources and mentorship to help members launch or grow their businesses during a recession. One association conducted detailed surveys of its members’ financials, maintaining anonymity, and now provides the resulting benchmark data to both members and non-members, earning a 7-figure non-dues revenue stream.
    • Discounts and member benefits: Associations can negotiate discounted rates on products and services to help members save money during a recession. Costs like health insurance often present an enormous, often untouched, opportunity in this regard.
    • Research and data: Associations can furnish research and data to members on the current state of the market and trends within their respective industries for them to make informed decisions.
    • Legal and financial advice: Associations can provide access to legal and financial experts to assist members with issues related to navigating a recession.
    • Increase sponsorship revenue: When was the last time you reviewed your sponsorship model and opportunities? These tend to evolve over time, so your sponsorship strategy should as well. For example, associations are beginning to sponsor mobile directories that connect members while increasing page views and, therefore, sponsorship dollars.

    Reduce Costs to Get More Mileage From the Same Jet Fuel

    Associations are finding significant cost savings in integrations that connect key systems together. It’s not your grandfather’s cloud anymore, so there are new opportunities through advanced Application Programming Interfaces (APIs) and strategically designed data warehousing to share data and streamline workflows.

    Neither you nor your members can afford double data entry, so ensure data is entered only once and shared where needed. For example, technologies like nightly synchronization routines and Single Sign-On (SSO) can free up resources while improving data integrity.

    Enhanced data visualization and business intelligence software can surface essential trends and insights without having to allocate staff resources to research them.

    A properly configured Association Management System (AMSs) can play a vital role in helping associations weather a recession. By managing operations such as membership, events, and finance. AMSs provide valuable data and insights, such as membership trends and financial reports, which, in turn, can help associations make informed decisions about their scope of work and day-to-day operations.

    AMSs can also facilitate a great deal of automation, alerting, for example, staff to engagement changes prior to the renewal or notifying members of expiring credentials or early-bird registration windows. All of these can boost engagement without the labor needed to monitor these dynamics manually.
    Of course, AMSs’ level of sophistication today typically goes beyond the plug-and-play of a few years ago, so make sure your AMS is fully optimized for your data environment and functionality requirements. A substantial cost to avoid is the effort to replace your AMS when it was actually fully adequate but merely misconfigured.

    Conclusion

    To sum up, while the prospect of a recession can be daunting, associations can take steps to prepare and mitigate its potential impact. By diversifying revenue streams and reducing expenses, associations can position themselves for success in any economic climate, however grim the forecast.

    Key takeaways:

    Diversify revenue streams:

    Develop new products or services, seek out new sponsors and partners and increase non-dues revenue to minimize the impact of a decline in membership or sponsorships.

    Flexibility:

    Be open to new ways of working, new technologies and different ways of engaging with members. This will save costs and increase efficiency.

    Reduce expenses:

    Streamline operations and look for ways to cut costs, such as negotiating better deals with vendors or outsourcing certain tasks.

    Network and Collaborate:

    Build strong relationships and partnerships with other organizations, companies, and associations in order to access new resources, knowledge, and opportunities.

    Increase membership and engagement:

    Offer more value to current members while promoting the benefits of membership to prospects. This will increase membership and participation.

    Only then will the silver linings be visible.

    Questions? Call 719-581-2221 anytime to arrange a consultation with either author. Both have spent a decade or more helping associations grow, can share with you what’s worked and would love your feedback.

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