10 Reasons not to Use Spreadsheets for Product Development

How Excel Undermines Hardware Startups


When it comes to managing product information, many companies use Microsoft Excel or Google Sheets to define Bills of Materials (BOMs), manufacturer parts and item descriptions.

However, Excel isn’t just something reserved for small and mid-sized businesses (SMBs). Even large companies use Excel with sophisticated macros to mimic complex relationship lookups. While many companies can continue using Excel to manage product data, there are many limitations with Excel that can undermine the success of a startup’s hardware products.

We’ve talked to several hardware startups that initially couldn’t understand why they would want to use anything besides Excel. And why not? Excel is basically free, easy to use, and super flexible. But once it goes beyond a single user trying to manage a single product — when they realize that they need to collaborate with other colleagues or suppliers — they realize Excel falls short. 

Keep reading to see how Excel can undermine your startup success or just download the PDF.

1. Visibility into Changes. When you update product data in spreadsheets, it’s extremely difficult to know what’s changed from one version to another. How do you also know which version of your spreadsheet is the right one to use? And once you need to share a file with someone else, it’s nearly impossible for them to determine which version of the spreadsheet they should be using. If you use workarounds like macros, comments or color-coding, you also need to be sure everyone is using the same version of Excel that you are; otherwise, some of your workarounds may be lost in translation. 

2. Customer Insights. Any time you make a product change, it’s critical to know what the impact is in the field, especially with customers. Unfortunately, Excel is a standalone tool that provides no integration to customer or partner data. Any time there’s a change, you have to manually figure out which customers or partners would are. Instead, you should ideally track the relationship between customers, product revisions, and partners in one central location, so you can take appropriate action. 

3. Change Approvals. If you need to have people approve changes, the most common method is to email a spreadsheet to everyone. But even if you have all the right people on the email thread, your email may get lost in people’s inboxes. Tracking approval history via email adds to the hassle of email approvals. Instead of email, you should rely on a centralized change approval system. 

4. Tasks and Reminders. When you change a product, you also need to make sure you complete specific tasks, like updating a datasheet or performing a cost-impact analysis. Tracking who needs to complete what by when is a highly manual and inconsistent process using Excel. Chasing down owners for each task through email makes everyone less productive as well. Instead, you should try to make it easy as possible to tie tasks and reminders to product changes. 

5. Shared Parts and Components. Components, manufacturer parts, files and other items are typically used across multiple assemblies. If you need to replace an item, it’s easy to use Find and Replace to change out that item on a single assembly. However, doing so for multiple assemblies is impossible unless you know every assembly that has that component. Having advanced Where Used capabilities would dramatically simplify component changes. 

6. Validation Rules. All products should follow some basic rules and guidelines, such as having the right part number. However, aside from complex macros, Excel falls short. Even something as simple as creating a product with the next available part number requires effort. When it comes to more advanced guidelines like being allowed to edit certain product data depending on a part’s lifecycle phase, it’s impossible with Excel. 

7. Design Context. How and why did your team decide to update a product a certain way? That type of discussion is usually captured in email or meeting notes. If you rely on Excel to update product information, it’s impossible to capture your design discussion and product decisions. Instead you need to have a way to facilitate and document collaboration across internal and external stakeholders. 

8. Files and Attachments. Most parts used in a product have documentation, including design specs, product documentation, manufacturing datasheets, and sales tools. While it’s possible to use Excel to link to multiple file locations, how do you manage file versions and access? If someone wants to update a file, how do you make sure your Excel file has the right version? 

9. Product History. As your products get rolled out into the market, documenting product and change history is vital. It’s critical to know which product versions have which components and manufacturer parts, which customers own which versions, and when changes were implemented. For companies who have to deal with any regulation or certification process, documenting product and change history is mandatory. 

10. Future Support. Excel is often used because it’s so easy and flexible. But as your business changes, you need to make sure your spreadsheet keeps up. If others need to use the spreadsheet, you’ll also need to train them. And if your Excel guru leaves your company, who will resolve any issues or enhancements with your homegrown spreadsheet?