The Evolution of Target Costing Concepts and Implementation in the Manufacturing Industry: A Critical Literature Review 2010–2025

Abstract

This research explores the conceptual and implementational metamorphosis of target costing in manufacturing industries during 2010–2025 through a critical literature review. Thematic-contextual analysis reveals a paradigmatic transformation of target costing from a cost calculation instrument into a comprehensive strategic approach synergizing with Industry 4.0 initiatives and sustainability imperatives. Findings identify determinant factors for successful implementation, encompassing contextual dimensions (industry characteristics and competitive dynamics), organizational aspects (collaborative culture and management structure), and technological elements (analytical capabilities and digital infrastructure). Convergence with digital transformation is reflected in the adoption of disruptive technologies facilitating predictive accuracy and multi-criteria optimization, while integration with sustainability principles generates the concept of “green target costing” that accommodates environmental considerations in comprehensive cost calculations. Strategic implications indicate fundamental reorientations in decision-making architecture, stakeholder relationship reconfiguration, and transformation of competency frameworks within modern manufacturing contexts. This research contributes to the development of adaptive, responsive, and sustainable cost management approaches.