1. ¹University of Waikato, New Zealand
2. ²Loughborough University Business School, UK

Correspondence: M. King, Loughborough University Business School, University of Technology, Loughborough LE 11 3TU, UK.

Abstract

Spreadsheet models are increasingly being used in decision making within organizations. With questions about the quality of these models, an investigation was conducted into the spreadsheet practices in ten firms, with an emphasis on the process of building spreadsheet models. The study showed that spreadsheet models were usually built in an informal, iterative manner, by people from all organizational levels. These people had received very little training in the building of models, which could help explain why at least 25% of the models contained errors. Other problems were also found. It was evident that the spreadsheet practices in the firms were inadequate. There is a need for increased training as well as setting and enforcing organizational spreadsheet standards. This could provide an opportunity for OR workers if carefully handled. Although the study was viewed as exploratory, it indicated a need for further study into the effect of formal design practices on the incidence of errors and model creation time.