Manufacturing BOM dilemma

Manufacturing BOM dilemma


Manufacturing process optimization is one of the biggest challenges in product development these days. Companies are looking how to low the cost, optimize manufacturing process for speed and to deliver large variety of product configurations. The demand for these improvements is very high. The time when engineering were throwing design”over the wall of engineering” is over. Engineering and manufacturing people should work together to optimize the way product is designed and manufactured at the same time. Which, in my view, leads to one of the most critical element of this process – Manufacturing BOM (MBOM).

In one of my earlier posts, I addressed the challenges PLM systems has to manage BOM. PLM vendors are recognizing the importance of manufacturing solutions. However, it is hard to deliver MBOM in PLM. It related to CAD roots of PLM products, historical disconnect of engineers from manufacturing processes, complexity of synchronization between multiple BOMs and problems of integrating with ERP systems. Vendors are encouraging companies to use PLM technologies to manage MBOM and to push right product MBOM information to ERP for execution. The advantage of that is the ability of PLM to deliver accurate product information derived from design and engineering BOM.

However, there is another side in this story- manufacturing planning. Fundamentally, MBOM is created by manufacturing engineers and it reflects the way product is built. It usually structured to reflect manufacturing assembly operations, workstations, ordering process, etc. In other words, MBOM is a reflection of manufacturing process based on information from product design. Company can decide to improve manufacturing process for existing product. It means most probably no changes for CAD design and EBOM, but will require to create a new version of MBOM.

As a result of that, MBOM has dual dependence of both correct engineering information from PLM system and manufacturing constraints and part information management by ERP. Both are absolutely important. By placing MBOM in PLM system company can create a complexity of manufacturing process planning in ERP. At the same time, ERP system (more specifically manufacturing modules) are not providing dedicated BOM planning tools capable to handle information from EBOM and MBOM simultaneously.

What is my conclusion? Manufacturing BOM is stuck between a rock and a hard places. It must reflect manufacturing process and stay connected to both PLM and ERP environment. It creates a high level of complexity for existing technologies and tools. To create a cohesive environment to manage MBOM is tricky and usually requires significant services and customization. Just my thoughts…

Best, Oleg

Want to learn more about PLM? Check out my new PLM Book website.

Disclaimer: I’m co-founder and CEO of openBoM developing cloud based bill of materials and inventory management tool for manufacturing companies, hardware startups and supply chain. My opinion can be unintentionally biased.



Share This Post

  • Paolo Zotti

    Oleg, I respectfully disagree.
    Of course you need to have sufficient information about available manufacturing resources (as well as on the product) to design a manufacturing process, as well as to any changes to that process. This can be done in PLM, and simulating digitally such process alternatives, or changes, help customers validating them.
    This is important because in ERP you want to have validated MBOMs and Routings (processes) that you can flexibly utilize in your master production schedule (MPS), to take informed decisions like producing on one production line or on the other, making or buying certain subassemblies etc. , given the appropriate level of information.
    It would be very risky to use non validated processes and BOMs in your MPS, that’s why on the shop floor there is a deviation or concession process, to evaluate such unforeseen changes, when the need arises.
    For example: take assembly A, that you usually buy from a supplier. You know that another supplier can provide assembly B, functionally equivalent to A, but it comes in an assembly kit. B is an approved alternate to A.
    If you are producing your product in ERP, and assembly A goes out of stock, you may want to use B instead but need to modify your master production schedule to accomodate the additional process steps necessary to put B together.
    The way you would like to do that, is to pull from PLM the alternative production process – already digitally validated – that includes the assembly of B, compare the time difference with waiting for the next delivery of A, evaluate if the production capacity can handle that, and take an informed decision.
    Not by trying to modify the master production schedule directly in ERP, finding some extra workers, resources and time slot in which someone, somehow assembles B. That would be calling for issues on the shopfloor.

  • beyondplm

    Paolo, thanks for your comments! I found it very helpful. No question – PLM can get enough resources from ERP (manufacturing resources) to perform design of manufacturing process. From my understanding this is what TeamCenter MPP product is doing. Without comparing the performance, I guess other vendors have similar products. However, to get resources from ERP and keep them in sync is not a simple task. The same works in opposite direction – to keep ERP system preloaded with already validated alternative production process or maybe to develop them on demand can be complex as well. I guess large manufacturers are using this approach combined with one of selected PLM/ERP software combination. But it keeps MBOM constrained between a rock and a hard places.

  • Scott Cleveland

    My solution to this problem is to use PLM software as the BOM change manager. Any changes to a BOM must go through an ECR/ECO. That allows PLM to manage changes and PLM will send the latest BOM to ERP. I have done this before and it works well…

  • beyondplm

    Scott, thanks for sharing your experience! I agree – this is a very practical approach. However, the disadvantage of this solution is a complexity of collaboration between engineering (PLM) and manufacturing (ERP). What would be your recommendation for that?

  • beyondplm

    Scott, another question – what is the cost of management of ECR/ECOs in this case?

  • Pingback: MBOM collaboration and cost of change()

  • Pingback: MBOM collaboration and cost of change | Daily PLM Think Tank Blog()

  • Larry Ensler

    What about PTC’s Windchill MPMLink. It seems to do everything that you have mentioned. Multiple versions of mBOMs that are related to a simgle master assembly. each are independently editable and releasable. They also tie directly into a Manufacturng Process System.

  • beyondplm

    Larry, Thanks for your comment. That’s correct. WC MPMLink is PTC’s answer on the problems of manufacturing planning. Dassault and TeamCenter have similar products. It would be interesting to compare them to see pros and cons. Are you using MPMLink on daily basis? what is the largest BOM you handled with Windchill solution. What ERP system are you integrated with? SAP or Oracle? Thanks, Oleg

  • Pingback: Expert Interview with Oleg Shilovitsky Of Beyond PLM on Engineering And Manufacturing Innovations | CADspeed()

  • Pingback: Beyond PLM (Product Lifecycle Management) Blog Will SAP and Siemens come on the same BOM? - Beyond PLM (Product Lifecycle Management) Blog()