I find points 1 and 2 difficult to believe as the primary reason people rely on Excel. I think the primary reason is as seanstickle suggested: Excel is the only programming environment many "business people" know and are comfortable in. I personally know people who use Excel for data analysis, and it's because they don't know a general purpose programming language.
edit: Based on your other comments downthread, I realized that you meant the IT department themselves should develop the application using "proper tooling", not the business people. That means that the business people will have to hand over requirements to the IT people, who will write the software. I think turn-around time may be too much for business people who want to do their own data exploration.
> Based on your other comments downthread, I realized that you meant the IT department themselves should develop the application using "proper tooling", not the business people.
Not necessarily, though that really depends on the technical competencies in the organization and a number of other factors.
> That means that the business people will have to hand over requirements to the IT people, who will write the software.
Well, I kind of think that if you are going to have an organization that effectively uses technology, you need technology-aware process/system analysis embedded in operational organizations at a fairly low level facilitating process optimization including, as necessary, technology acquisition and software development. That's a pretty big culture change for most organizations that aren't technology organizations, I will admit.
> I think turn-around time may be too much for business people who want to do their own data exploration.
I don't think the problem area in Excel use is "data exploration", but, yes, I think that overly bureaucratic, insufficiently agile processes which separate software development from operations do create friction which leads to use of suboptimal tools -- including, but not limited to, use of Excel where its not appropriate.
edit: Based on your other comments downthread, I realized that you meant the IT department themselves should develop the application using "proper tooling", not the business people. That means that the business people will have to hand over requirements to the IT people, who will write the software. I think turn-around time may be too much for business people who want to do their own data exploration.