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BOM management

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The importance of Bill of Material in product development and manufacturing hardly can be undervalued. BOM is a cornerstone of almost all processes and activities – from early requirement and design and to manufacturing, services and support. Therefore, efficient BOM management is an absolutely important element of product development processes. PLM vendors are coming with different solutions to manage BOMs. Together with vendors’ solutions, manufacturing companies are developing practices (and sometimes a complete solutions) how to manage Bill of Materials.

I’ve been discussing the idea of “single BOM” for the last few years as a possible way to simplify BOM management. My earlier post – Severn Rules towards Single BOM is almost five years back (2009) raised very interesting debates. All of them are still relevant in my view. I wanted to highlight one very insightful post by Jim Brown here. Jim speaks about different aspects and advantages of single BOM management. As part of this conversation Jim introduced a concept he called – associated BOMs. Here is the passage I specially liked:

Companies have spent a lot of time and effort making logical connections between different BOMs, and developing tools to help develop and synchronize different BOMs. For example, PLM, MPM, and Digital Manufacturing software helps companies translate an engineering BOM into a manufacturing BOM and then further into a BOP. In fact, they have gone further upstream to match conceptual BOMs and requirement structures downstream to BOMs. Maybe you would call these “workarounds” to the real answer of a single BOM. But I would propose a different view based on history and my observations. Perhaps engineers have done what we do best – addressed the problem in the most practical way as opposed to the most elegant way to solve a problem.

I think, Jim’s post is absolutely relevant today. After few years of discussions on this topic, one of my hypothesizes is that companies are not ready for single BOM solution… yet. At the same time, I do believe companies can take realistic steps into single BOM management already today. The variety of ways companies are managing bill of materials can surprise even people with lot of experience in manufacturing and PLM. After many years, I’m always surprised to find “yet another way” to manage bills, configurations and associated manufacturing and production information.

My attention was caught by Teamcenter PLM blog few weeks ago – Bill of Materials concept.  Author, posted a very good summary about different types of BOMs. Together with eBOM, mBOM, sBOM and few others, it outlines the idea of Master BOM as a centerpiece of BOM Management capable to provide “single source of truth” about BOM. The following passage explains the idea:

To overcome this challenge, the concept of Master BOM has come.  Master Bill of Material can be defined as single source of BOM having all aspect of information for various configuration and discipline. Hence Master BOM by definition is single source of truth for all BOM. Industry is still struggling to find the exact solution in term of defining and managing Master BOM. Also it become more complex due to the facts that different BOM types are managed in different systems. PLM vendors including Siemens PLM has come various solution and tools, but still required to show the success and maturity of managing Master BOM as a single source of truth across various BOM lifecycle and discipline.

This post and exchange of comments made me think about potential two challenges in BOM management – technology and process. The way and technology to support and implement the idea of “master BOM” is quite complicated as well as PLM implementation attempts to integrated product data under the umbrella of “single point of truth”. At the same time, the idea of “master” or “single” BOM management faces multiple political challenges including discussions about internal and external company processes. In my view, modern data management technologies (especially coming from web and open source) can introduce some advantages in BOM management. It can be related to scalability of data management solutions as well as improved collaboration features. Would it be enough to overcome process challenges? This is a good question to ask these days.

What is my conclusion? After decades of development in PDM, PLM and ERP, companies are still struggling with BOM management. The topic is quite complicated and introduce many technological and process challenges for companies. Future pressure around competition, customization and cost can bring BOM management challenges back. It will be interesting to see what (technology or processes) improvement will allow to unblock future of BOM management? No specific conclusion. Just thoughts today…

Best, Oleg

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JIT’s impact on PLM and BOM management

by Oleg on February 21, 2014 · 4 comments

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JIT (Just in Time) is a well-known approach in manufacturing industry. In a nutshell, JIT is a production strategy to reduce inventory and associated cost. The philosophy of JIT is related to processing and transactions of inventories, which adds additional cost. By removal (or reducing) of inventories, you can reduce a total cost of production. You may ask me – where is product lifecycle management in this story? It sounds like completely “manufacturing problem” and something that shopfloor and suppliers network should be able to resolve. However, it is not true. In my view, there is tight connection between PLM implementation and JIT manufacturing planning.

Think about manufacturing planning and control. One of the functions is to get access to engineering bill of materials and use this information to create manufacturing plan – workcenter planning, suppliers orders, assembly instructions, etc. The efficient coordination between engineering environment and manufacturing planning is one of the key elements of successful production planning. Now, this is true for every manufacturing types. In most of PLM implementations it means the ability to send design or engineering BOM to manufacturing planners to work planning BOM. The difference come with specific of planning and manufacturing BOM organization related to JIT manufacturing principles.

So, what is the difference in bill of materials for JIT? The main one is significant reduce of bill of material levels. JIT reduce the number of part numbers planning and number of levels in BOM. Many part numbers that in traditional MRP practice are treated as in/out inventories now can be treated as “phantoms”. This is actually one of the main goals in JIT – to reduce complexity of detailed manufacturing planning. However, it brings a need to maintain more synchronized communication between engineering and manufacturing – literally between design/engineering and planning bill of materials.

In my view, the main challenge of PLM tools in JIT manufacturing environment is related to engineering-manufacturing collaboration. PLM implementation should be focusing on better synchronization of both development/engineering and manufacturing/planning. The implication in PLM – additional requirements to BOM tools and ECO management. Inefficient collaboration can raise the number of engineering change transactions – one of the most expensive transactions in every manufacturing company.

What is my conclusion? JIT makes manufacturing processes more connected and synchronized. It is obvious that JIT implementation impacts supply chain network. The operations between suppliers are getting more tight. However, JIT is impacting engineering and design processes too. Therefore, as much as manufacturing is moving towards lean principles, the demand for better engineering-manufacturing collaboration will increase. I can see it as a significant challenge in many PLM implementations. Specially it may impact BOM and ECO management tools. Just my thoughts…

Best, Oleg

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Will PLM manage enterprise BOM?

by Oleg on August 26, 2013 · 2 comments

Bill of Materials is a huge topic. It is hard to underestimate the importance of BOM management in general as well as specifically for PLM systems. I’ve been blogging about BOM many times. Use this custom Google search to browse my previous beyond PLM articles about BOM.

One of the topics I’m debating already long time is so called “single BOM”. I explained my early view on a problem of a single BOM back in 2009 in my post – Seven Rules Towards Single Bill of Materials. Despite most of people you talk to would agree with the idea, the implementation of single BOM in modern enterprise is complicated and challenging. Take a look on another post to get a glimpse of what I’m talking about  - Why companies are not ready for single BOM? One of the biggest problem towards achieving of single BOM idea is integration challenges. Today, BOM data resides in  many systems in enterprise. Each of these systems provides a specific functional view on BOM management – design, engineering, supply chain, manufacturing, finance, etc. However, the integration of these systems is a very complicated task. In addition to that, the attitude of vendors to lock data to improve the competitiveness of their systems applies additional integration and communication difficulties.

Manufacturing companies have many challenges these days. BOM management is one of them. Despite the fact of complexity of single BOM management strategies, businesses need to have a holistic view of bill of materials. I touched it in my 3 modern BOM management challenges blog post - lean manufacturing, heavy customization, supply and contract manufacturing.

In my view, the problem of BOM management is well understood by industry. I stumble upon one of the old Siemens PLM blog posts written by Nick Pakvasa – BOM Challenges in Automotive Industry. In addition to (obvious) recommendation to use TeamCenter as for enterprise BOM management, article nails down the problem of single BOM. Here is my favorite passage:

The requirement to get the BOM under control at the enterprise level is reaching a critical stage. Exponential increase in software content is driving the requirement to eliminate legacy BOM applications that were structured purely to support older product architectures which were predominantly based on mechanical parts, to an environment that has to deliver integrated BOM management capability for all content in the product. And, to deliver this capability with lifecycle BOM management needs incorporated into the application, and to manage this BOM data starting in the Product Planning phase, through designing, building, selling, servicing and retiring the product. Without integrated enterprise level BOM management supporting all functional areas, geographical locations and external suppliers, partners and joint ventures, actions such as traceability of quality and other imperatives, reuse, BOM access for Service, and lifecycle enterprise change management are either cumbersome, with redundant or non-value added effort, and potential for errors, or in some cases, cannot be executed.

What is my conclusion? The recommendation of all PLM vendors is to use PLM as a central system to manage all BOMs. The recommendation is obvious. However, my hunch is that problem is bigger than it presented by PLM companies and other vendors developing systems producing and requesting data about of BOMs. The complexity of integration, implementation legacy and variety of requirements are creating a very complex application space to manage. In addition to that, high level of competition together with political influence inside of every manufacturing company, make the decision about BOM management one of the most complicated in modern enterprise systems. Just my thoughts…

Best, Oleg

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BOM 101: How to modularize the Bill of Materials

February 14, 2013

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 […]

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

January 21, 2013

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 […]

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