If it is a string  "Error" You could search  using the normal search tool.

You would need to use the FSO to find all the .xls files  in a directory

You would open each of them and then search for the string. The search will
return a value which can be interpreted as "found" or "Not Found" You would
use this result to set a flag which will indicate if the string was found.

By normal serach tool do you mean Instr functions  or look up tool
such as MATCH or LOOKUP?

Also using FSO, would I be able to look up into the concerned excel
files without having to import it into my application ie. excel  files
where the macro  resides?

The search  part of the macro  would look like

Dim MyWorkbook As Workbook
Dim MySheet As Worksheet
[FSO Code to open each workbook in turn  here]

MyString = "error"
For Each MySheet In MyWorkbook
x = MySheet.UsedRange.Find(MyString).Activate
If Not x Is Nothing Then
MyFlag = 1
End If
Next

The FSO will find the workbooks and open them. You will not be able to access
the contents of them without opening them in the application. (Unless you use
a text  search facility completely outside VBA).