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Bill of Materials

BOM 101: How to modularize the Bill of Materials

by Oleg on February 14, 2013 · 0 comments

I want to get back to my BOM 101. In my view, Bill of Material management is one of the fundamental processes in PDM/PLM and requires lots of attention. I want to take the feedback made by Jos Voskuil and turn the conversation to be more business oriented. One of the trends in manufacturing today is customization. And this is a big challenge for manufacturing companies. Life was good in mass-production world, when the goal was to provide large series of items with predefined configurations. Not anymore… Today, clients are interested to how customize everything. Companies dealing with ETO type of business are facing similar challenges.

Efficient Bill of Materials management system can solve this problem. If you have flexible BOM management system allowing you to manipulate BOM structures and integrated with you ERP environment, you are half way done. However, technology out of the box won’t help you. It requires to apply some best practices too. One of the practices I want to discuss is “modular Bill of Materials”. Wikipedia provide a very short article about that, but I liked the definition.

Modular BOMs define the component materials, documents, parts and engineering drawings needed to complete a sub-assembly. While the terms BOM and modular BOM are most commonly used in association with physical products, the concept can be used in a variety of industries (e.g. software, medical records). Modular BOMs are used by modern information systems to serve a variety of purposes, such as defining the components needed to produce a sub-assembly, and providing cost information for each component and “rolled-up” cost information for the overall sub-assembly.

The core idea of modularization is to create a set of “modules” (aka sub-assemblies) that you can manipulate in order to create a final product. The product development process will be divided into two essential steps: create your modular bills and create a planning bill for a specific product. The last one will allow you to roll out cost and delivery time for a specific product order. Below I put five steps to follow in order to modularize the process of Bill of Material management in your company.

1. Identify family groups. This work can take time, but will allow you to make some steps to improve you product portfolio. Most probably you already have some portfolio management tools in house. Engineering has a tendency to complicate everything. So, you may find an overwhelming number of product families in your company. So, you must take some time and optimize that.

2. Identify options. These are elements of products and bill of materials that can be added to multiple product families. Usually represents additional features that can be added and can be replaced. The typical example of options is different configuration of car in-dash navigation and entertainment system. What is also important at this stage is to identify constraints between options (conflicts, incompatibilities, etc.)

3. Create Master Bill of Materials. This is a very important step. Master Bill of Materials represents all families and all options. This is “THE” bill of materials of all your products, which allows you to plan and to manufacture any product and configurations. In most of BOM management system you operate with ‘phantom’ feature to create an efficient master bill of materials. The reliability of BOM management system is very important at this stage.

4. Create planning BOM. Planning bill of materials represents a specific product, configuration, order, etc. You generate “planning BOM” out of your master BOM in order to create a specific delivery task for your manufacturing system. You practically derive your planning BOM out of Master BOM. Tools that allows you to copy/compare structures and BOM levels are absolute must to make it work.

5. End item bill. This is a final stage. End item bill represent the customer world and the way to translate planning bill of materials into the delivery. There are multiple ways to create end item bills – create bill for every SKU#, manually configure options or implement automatic rule based configurations. In my view, the last one is the most promising alternative. However, it requires additional efforts to implement. So, don’t be surprise many of customers are manually configuring end item bills.

What is my conclusion? Modern manufacturing practices require good technologies and best practices applied together. To me, BOM modularization is one of best examples. You need to have an efficient BOM management system with technologies and user experience allowing you to work collaboratively on BOM in a very granular way. At the same time, you need to apply some planning steps to rationalize and optimize the way you work with configurations, custom orders and product customizations. The cost is a fundamental driver in a modern manufacturing world. An efficient BOM modularization will allow you to follow demands of customers for customization and keep product cost down. Just my thoughts…

Best, Oleg

Image courtesy of [Salvatore Vuono] / FreeDigitalPhotos.net

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BOM 101: 5 “Don’ts” for Bill of Materials Management

by Oleg on January 21, 2013 · 3 comments

BOM is fascinating. After posting 3 Modern BOM Management Challenges a week ago, I keep getting back to Bill of Materials management topic.  If you missed my previous BOM 101 posts, here are links to get up to speed: BOM 101- The four pillars of every BOM management solution, BOM 101- How to optimize Bil of Materials. You can also take a look on this post as well – Single BOM in 6 steps. Today, I’d like to take a bit different angle by stating my 5 top most important “don’ts” you need to follow when designing and implementing bill of materials solution in your company. These topics are not necessarily reflecting PLM system. You can face the same problems when implementing BOM solutions using Excel spreadsheets, homegrown DIY data management and large ERP solution.

1. Don’t use significant numbers for Part Numbers – Use Classification

The discussion about “significant” vs. “non-significant” part numbers is probably endless. If you are new in this discussion (or just came out of computer science college), a significant Part Number looks like this 60-44-FN400587-60-NM-40-DWG-CHI. The information in this number is coded and different groups of this number are representing different meaning. Is there something wrong here? No, it is absolutely fine to have significant part number. Even more, if you are still using Excel spreadsheets or legacy data management system, this is probably the only way you can do it. However, it is complicated and eventually will lead you to mistakes. These days, most of PLM systems will provide you with the easy way to use insignificant part numbers. One of the features of good data management system is advanced classification mechanism. Such type of mechanism will help you to define all meaningful terms and characteristics of your Parts, Assemblies and Materials.

2. Don’t use supplier’s part number – use your own Item Master number 

When working with suppliers, you may decide to use supplier’s part numbering schema. Especially if you are small company, it sounds very reasonable and it can simplify the communication with suppliers. However, this is a wrong thing to do, in my view. Again, PDM / PLM system maintaining item master record with cross-reference mechanism between parts and supplier part numbers can easy solve this problem and simplify your life in the future. What will happen with your system and processes if supplier will decide to change their number schema one day? it will be probably a very complicated day for you. So, use your own item master numbering schema and don’t rely on suppliers.

3. Don’t use the same ID for Part Numbers and Drawing Numbers 

This is another question often asked during implementations. To use the same number for items and for drawings as well as process sheets, specification documents, etc. Initially sounds like something that could be simple enough to support and manage, can potentially lead to significant complexity and limitation in managing of change processes. The same drawing can be used for different part numbers. At the same time, changes of part numbers related to materials, stock, etc. won’t require drawing changes. Keep separate numbers and manage relationships between them is a good data management practice to follow.

4. Don’t be afraid to use extra part numbers 

Identification is a very important mechanism. Sometimes, the assembly process is quite complicated and requires some temporarily pre assembled elements of the equipment to be maintained separately. In addition, you might have materials such as service parts, replacements, process result chemicals, etc. Bottom line – you don’t want materials in your bill to fly without identification. Everything needs to be included into the bill. Today’s data management systems are powerful enough to manage “extra Part Numbers” to identify everything you need in your bill.

5. Don’t put Bill of Materials on the drawings 

Another topic coming from historical usage of paper drawing. In the past, it was the only way to share information. Obvious decision back that days was to put Bill of Materials on the drawing list. In modern digital life, such practice can create a lot of complications and additional procedures (such as updates of drawing when only part list will be changed). The good practice today is to keep cross reference links between drawings and bill of materials. It will allow you to manage your changes process efficiently and optimize your and your company time.

What is my conclusion? Control and efficiency. These are two important words to remember when  you deal with Parts, BOMs and Documents. Many processes in this space were developed in the past and can trail lots of complexity if you not update them to “digital era”. To streamline processes and make change management simple are important goals to following when creating the foundation of your BOM management solutions. Just my thoughts. I’m sure missed some issues and useful tips. Speak your mind and share your experience….

Best, Oleg

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BOM 101: The four pillars of every BOM management solution

by Oleg on January 17, 2013 · 3 comments

I suggest you an experiment. Invite two engineers and ask them to provide a definition for some of PDM/PLM related terms. I’d not be surprised if you will get more than two definitions. It is not unusual to spend lots of time during PLM software implementation meetings to define terms, language and meaning of things. Regardless on terminology, I found BOM to be a central element in every product development organization and business. It contains a recipe of your product, process and, at the end of the day, becomes a lifeblood of your product development processes. Thinking about BOM management solution, I can see four major things that need to be defined, discussed and clarified.

BOM and Part Lists

Bill of Materials (BOM) is a list of all items required to make a parent item. It includes components, raw materials and sub-assemblies. You may also include intermediate items identifying in-process elements to facilitate planning and other manufacturing processes. Depends on industry, people can call BOM differently. For example, in process industry, it can be called recipe or formula. Opposite to BOM, Part List is usually a term used to call a single level list for a specific level of assembly or sub-assembly.

Part Number 

This is one of the most tricky defined terms in a whole product development and BOM management story. Here is a short definition. Part Number (PN) is an unique identifier that identify a single object in bill of material. However, the trick is how to define object and how to keep it consistent with your processes. Assigning part numbers is often complicated and one of the most discussed topics. The traditional definition of FFF (Form, Fit and Function) helps to identify the right objects. Interchangeable parts, substitiute items, special parts – this is only a short list of issues that comes into the discussion around part numbering process.

Routing 

Think about navigation system with the road between different places. Now imagine part numbers. Routing is a roadmap that defines the path of part numbers across manufacturing floor by specifying workstations and labor time associated with every station. Usually routing applied to manufactured parts or items.

Drawings

Drawings represents a significant part of history and confusing engineering habits. Historically, drawing is the place where people put bill of materials for a product. It also solves the problem of Bill of Materials distribution in the company. At the same time, BOM on a drawing brings lots of disadvantages. In many situations, people don’t need drawing, but only need bill of materials and/or part list. Another point of confusion is numbering system. The discussion is about applying part numbers on drawings. In most of the situations, it represents the limitation of systems used for product development (PDM/PLM). To separate between Part Numbers and Document Numbers is the most reasonable ways to manage it, in my view.

What is my conclusion? Regardless of what systems you plan to use, I recommend you to have cross-department organizational discussion about these four pillars. Usually, it helps to understand product development processes. Engineering and manufacturing are two main organizations usually involved into BOM processes. To clarify terms will give you a tremendous value during PDM/PLM system implementation and integration with ERP. Just my thoughts…

Best, Oleg

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Single Bill of Materials in 6 Steps

January 16, 2013

Last week I started the discussion about about modern BOM challenges. That discussion made me think more about the idea of unified and consistent Bill of Materials that can be shared across the company (single BOM). In my view, this is a clear paradigm shift from what we know today as “multiple BOMs”. How to [...]

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BOM 101: How to optimize Bill of Materials

January 14, 2013

Last week, I started the conversation about Bill of Materials and modern challenges. BOM is a heavy topic. Previous blog made me think about few additional things related to BOM management and I decided to share it with you too. One of the concepts I see as important in modern PLM and other enterprise systems [...]

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Why Companies are Not Ready for Single BOM?

December 19, 2012

Bill of Material is one of the fundamental things in engineering, manufacturing and product development. Whatever topic you start discussing, you end up with the discussion about BOM. Wikipedia, actually, provide a decent definition of Bill of Material. Here is the link and quote: A BOM can define products as they are designed (engineering bill [...]

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Multiple BOMs – Why Sync is so hard?

August 30, 2012

Vacation is a great time to work . Finally, you can have time to think about variety of topics that you are missing during your workdays. Here is the one I picked today – multiple bill of materials and synchronization. For those of you in PDM / PLM space even for few years, this topic [...]

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PLM, Multiple BOMs and Cross-Functional Teams

April 26, 2012

The ability to develop virtual conversation accorss continents and timezones is one of the most exciting parts of my blogging hobby. Earlier last week, I had a very interesting discussion about multiple Bill of Materials. It started from the discussion about BOM management and PLM 360 with John Evans here. Furthermore, it ended in almost [...]

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BOM and CAD-PDM-PLM-ERP Integration Challenges

November 2, 2011

I want to talk about Bill of Material and integration today. The reason why I’m coming to this topic is largely because I have a feeling “integration” will play a significant role in the future of product lifecycle management and enterprise systems in general. Two days ago, I’ve been writing about two approaches “unification” and [...]

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