Cost Management Software: 7 Reasons to Replace Excel | Tset

In manufacturing, the pressure to reduce costs, improve transparency, and accelerate time-to-market has never been higher. At the same time, most cost engineers and buyers still rely on spreadsheets to handle the complex task of calculating, comparing, and optimizing product costs. This article explains what cost management software actually is, how it works, and why Excel is no longer sufficient for today’s challenges.

Why Now: Key Industry Challenges Driving Change 

The manufacturing landscape is evolving rapidly, and relying on Excel for cost management is becoming increasingly untenable. These industry insights highlight why now is the time to transition: 

• Short-lived cost savings: A BCG study shows 83 % of companies achieve initial cost-saving targets, yet 35 % fail to sustain them over time, often due to fragmented tools and workflows. 
  
  
• Time wasted on data gathering: McKinsey reports cost engineers spend 30–40 % of their time simply retrieving and consolidating data because there is no centralized structure. 
  
  
• Component price volatility: In 2024 alone, average global steel prices swung by 25 %, and aluminum prices rose over 15 % - significant shifts that can cause major errors if not reflected promptly in costing models. 
  
  
• Surge in sustainability demands: Over 60 % of manufacturing firms say they are now required to include Scope 3 carbon reporting. Cost models that don’t account for CO₂ are increasingly seen as incomplete or inadequate. 
  
  
• Shifting supply chain dynamics: With nearshoring on the rise, cost engineers must compare landed costs, tariffs, labor, logistics, and carbon across regions, often involving dozens of variables. Excel simply can’t keep up. 

Why Manufacturers Are Moving Away from Excel 

Spreadsheets have been the default for decades, but they are no longer keeping up with the complexity of modern manufacturing. As data volumes grow and teams become more cross-functional, companies are turning to cost management software to improve accuracy, speed, and collaboration. 

Let us take a closer look at seven specific reasons why manufacturers are choosing structured tools over Excel and why you should too.  

1. Excel Slows Down Your Team 

Spreadsheets can be useful for individual calculations, but they do not scale. They are prone to human error, hard to standardize, and not designed for collaboration or scenario modeling. In many teams, each person has their own template. This makes version control difficult and creates risk during quoting, sourcing, or negotiation. 

2. Data Is Centralized and Always Up to Date 

Instead of maintaining Excel price lists manually, users can work with live market data feeds, benchmark databases, and their own internal data sources in one place. This eliminates manual updates and improves accuracy.  

3. Templates Replace Repetition with Structure 

Modern cost management tools provide standardized templates and calculation logic. Cost engineers can use pre-configured modules for parts like plastic housings, machined metal components, or packaging. Templates reduce rework and ensure consistent methods across users. 

4. Teams Work Better Together 

Excel offers no real-time collaboration. Multiple users often work on separate versions of the same file, leading to duplication, inconsistencies, and lost changes. Version control is manual, tracking who changed what is nearly impossible, and merging changes is time-consuming.This slows down decision-making and increases the risk of using outdated or incorrect data in negotiations or quotations. 

5. Over-Reliance on Individual Expertise 

Excel models depend heavily on the original creator. When that person is unavailable, understanding or modifying the logic becomes difficult. The lack of standardization makes onboarding new team members harder and creates risk when teams must update or reuse models. Different departments often develop separate approaches, which reduces comparability and limits scalability across the company. 

6. High Risk of Human Errors 

Manual data entry and complex formulas significantly increase the risk of mistakes. Errors in formulas, broken links, or overwriting data can result in major financial miscalculations. In Excel, tracing back logic and data lineage is difficult, which hinders quality control and auditing. Engineers often spend valuable time trying to understand or verify models, increasing the chance of introducing new errors. 

7. Cost and CO2 Insights in One Place 

With rising interest in sustainability and Scope 3 reporting, having both financial and environmental data in the same workflow helps teams evaluate trade-offs more efficiently. 

How Tset Cost Management Software Improves Your Costing 

Tset is built to replace scattered, manual workflows with one structured, collaborative software. Key benefits include: 

• Standardized calculation templates for faster, more accurate results 

• Full flexibility to build and re-use calculations using consistent logic 

• Live market data and internal cost references, updated centrally 

• Cloud-based collaboration and role-based access 

• Integrated CO₂ footprint analysis alongside cost 

• Centralized knowledge base that captures expertise across teams 

• Professional APIs and ERP/PLM integration for seamless data exchange 

• User-friendly interface that supports both experts and new team members 

With over 1,000 pre-built templates and combined cost and CO2 output, Tset helps teams move faster without sacrificing detail or structure.