Why Excel problem-solving skills matter more than memorizing formulas
Key takeaways
Strong Excel skills depend more on defining problems, breaking them into manageable steps, and applying the right functions than on memorizing hundreds of formulas.
- Define what you need Excel to solve before deciding which functions or tools to use.
- Working forwards from an obvious first step or backwards from the desired output can make unfamiliar problems easier to solve.
- Comparing how other people solve the same Excel task can reveal simpler, faster approaches and broaden your problem-solving toolkit.
Building strong Excel skills takes more than memorizing formulas. Discover why Excel problem-solving skills matter, how to develop them, and why they’re valuable for anyone looking to build a career in finance.
Imagine you wanted to learn a foreign language from scratch. You’re handed a dictionary and told to memorize every word. Would you end up a fluent speaker? Probably not.
You might wind up knowing thousands of words, but when it comes to actually communicating, you’d struggle. Knowing vocabulary is one thing; knowing how to put it together and use it in the right context is another.
The same principle applies to Excel. Memorizing as many formulas as possible may seem like the obvious way to get better at Excel, but with around 500 built-in functions and Microsoft regularly adding more, it’d be quite the undertaking. More importantly, memorizing them alone wouldn't make you proficient.
According to Pieter Pienaar, 2025 World Microsoft Excel Champion, what matters more is understanding how and when to apply the functions you know. In his view, problem-solving skills matter more than simply memorizing formulas. That means being able to understand a problem, break it into manageable parts, work out an approach, and then use Excel tools to solve it.
The point isn’t to stop learning formulas; it’s to learn what they do well enough to recognize when they might help.
How do you define a problem in Excel?
Even if you know every formula, that knowledge won’t get you very far if you don’t understand what you're trying to solve. Your starting point is to define the problem because that determines what you need Excel to do and which functions might help.
To define the problem, ask yourself: what information do I have? What outcome do I need? What constraints am I working with? Then break the problem into smaller parts and work out how you might solve each one. From there, you can decide where Excel can help and choose the right functions for the task.
One way to practice this kind of problem-solving is to try solving a Wordle puzzle with Excel. Dim Early, 2025 Excel World Champion, built his own Wordle helper, working out how to use Excel to narrow down the possible answers.
At first glance, the problem you’re looking to solve seems simple: identify a hidden five-letter word in six tries or fewer. But it’s actually more nuanced because each guess gives you new information. A green tile tells you that a letter is correct and in the right position. Yellow tells you the letter appears in the word but is in the wrong position. Gray generally tells you the letter isn't in the word.
To use Excel to help solve the puzzle, you need to translate those rules into various conditions it can test. Rather than simply asking Excel to “find a five-letter word,” you can break the problem down step by step:
- Start with a list of possible five-letter words.
- Remove words that don’t contain letters you know are in the answer.
- Check whether known letters appear in the right positions.
- Exclude words containing letters that have been ruled out.
- Keep only the words that satisfy all the conditions at the same time.
The value of this exercise is practicing how to take a problem, break it down into smaller questions, and work out how Excel can help you solve it.
A World Champion's tip for tackling an unfamiliar Excel problem
If you come across a problem you’ve never seen before, Pieter Pienaar recommends breaking it down into parts and deciding whether to work forwards or backwards.
If the first step is obvious, such as splitting a word into individual letters or performing a lookup, start there and work forwards. If the desired output is clearer, start with the final step and work backwards, asking what you need in order to produce it.
Solving one step can make the next one clearer. Keep working through the problem piece by piece until you've built the complete solution.
"Problem solving is more about determination than intelligence," Pienaar says.
How is Excel problem-solving used in finance?
Breaking a problem into smaller, manageable parts is just as useful in finance. Excel problem-solving involves turning an open-ended business question into a sequence of manageable, testable calculations.
Say you’re tasked with deciding whether a business is fairly valued. There isn’t a single Excel function that will give you the answer. Instead, you’d need to break the larger question into smaller ones. How has the company performed up until now? What’s driven its revenue? What might future cash flow look like?
Once you’ve worked out the questions that need answering, Excel can support each calculation, but you must still choose appropriate assumptions, check that the model works as intended, and interpret what the results mean.
How can you improve your Excel problem-solving skills?
As with any skill, mastering Excel problem-solving takes practice. For Pienaar, some of his most valuable learning has come from getting a problem wrong and then figuring out why.
When he struggles with a case, he looks at how other people approached the same problem.
“I’ve learned more through cases where I failed completely compared to cases I solved, because failing forces you to look at how other people think and how they approach a problem. It teaches you a variety of different problem-solving patterns,” he says.
But you don’t have to learn only from expert competitors. Pienaar says some of the most elegant solutions he has encountered have come from beginner or intermediate Excel users. Because they may not know the newest or most sophisticated functions, they sometimes approach a problem in a simpler way.
He gives the example of a problem he might try to solve with a large MAP function. Another user might instead use find and replace followed by an XLOOKUP and complete the task in a fraction of the time. The more sophisticated solution isn't always the better one.
The lesson, Pienaar says, is to avoid becoming too reliant on your favorite ways of solving problems. Seeing how other people approach the same task can give you a wider range of problem-solving patterns to draw on and help you choose the most effective one for the problem in front of you.
This approach is one of several lessons finance professionals can learn from the world’s top Excel competitors.
Can AI replace Excel problem-solving skills?
AI is changing how we use Excel, but it doesn’t remove the need for problem-solving skills. It can assist with some of the technical work, such as suggesting or writing formulas and explaining how they work. But getting a useful answer still depends on defining the problem clearly and giving AI the right context.
You also need enough understanding of the problem, and of Excel, to judge whether the answer makes sense and is accurate. As Pienaar points out, generative AI can produce different responses to the same question or misinterpret instructions, making it important to check its work rather than assume it's correct.
“When I prompt an AI for Excel formulas, I tend to include much more specific details than my colleagues, since I know what problems might arise and what Excel is capable of. Because of this, AI-generated formulas tend to be better for people who already have advanced Excel skills, since their prompts can be much more precise.”
In other words, AI may reduce the need to remember the exact syntax of every formula, but it doesn't eliminate the value of Excel knowledge. Understanding what's possible and where things can go wrong can help you give AI more precise instructions and assess the answers it gives you.
The key to growing your Excel skills
When it comes to improving your Excel skills, learning formulas matters, but the real progress comes when you know when and how to use them.
To become more efficient at problem solving in Excel: practice tackling unfamiliar problems, learn from other people’s approaches, and focus on figuring out what you need Excel to do before deciding how to do it. Over time, you'll develop one of today's most in-demand skills: creative problem solving, rather than simply memorizing formulas.
CFA Institute is a proud sponsor of the Microsoft Excel World Championship (MWEC) and the Microsoft Excel Collegiate Challenge (MECC) 2026. For more practical advice on developing your skills, explore our Excel Skills for Finance professionals' hub, which includes articles, learning videos, tips and insights from the world champions.
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