When BOM is not BOM

Bill of Materials (BOM) is a central part of everything in product development. Sometimes, people call it product structure. Manufacturers are using BOM to define list of raw materials, parts and sub-assemblies with corresponded quantities need to manufacture a product. This is over simplistic definition. As usual, devil is details and BOM story is getting quite complex. Depends to whom are you talking, people see a different aspects of bill of materials – sales options, design hierarchy, product configurations, manufacturing process, service parts. Many systems are defining BOM differently. It depends on their roles and functions in overall product lifecycle.

In one of my recent articles – Thoughts about BOM ownership, I discussed some ideas about how BOM can be shared among organizations and enterprise software tools. That was my attempt to think about how to resolve a conflict between two major BOM stakeholder – Product Lifecycle Management and ERP systems. The BOM management landscape in the organization is complex. In my view, companies are not ready for a single BOM management tools – it was my observation 2 years ago.

At the time a major BOM master ownership dispute is between PLM and ERP vendors, I can see an interesting trend which can put some lights on how PLM companies are articulating their BOM strategies.

Dassault Systems ENOVIA is coming with their “zero BOM error” strategy. I posted about it earlier – PLM and Zero BOM errors: the devil is in details. In a nutshell, ENOVIA is trying to improve process of Bill of Material generation by direct connection between CATIA design and product structure. In my view, it might lead to potential formal elimination of EBOM, which will be replaced by a bundle of design and engineering information. Practically, product structure in CATIA/ENOVIA will represent everything that happens on engineering level. According to ENOVIA strategy, it will eliminate errors between design and engineering.

In parallel, I’m observing the way BOM is positioned by Siemens PLM. Teamcenter blog – Introducing BOM management speaks about BOM information as a vital part of many processes supported by PLM. I found interesting how “BOM management” term was replaced by “Product definition”. Here is the passage:

I just noticed that as I am writing this I am using the words “bill of materials” less and “product definition” more. I would go back and correct – I wanted to keep it a surprise!  But I think it’s ok – it helps me get to this next part. To us, it has become abundantly clear that one of the problems that come up when you talk about bill of materials (BOM) management is that the scope of what people might mean is so broad. To call all those things listed above “BOM Management” is not sufficient.  We’ve collected these capabilities into an umbrella we call the Integrated Product Definition. This is an area where we have been leaders, and it continues as a high priority for us – we have the breadth and depth to address these issues like nobody else can.

In both situations, I can see a strategy by PLM vendors to redefine BOM and bring up the extended value PLM environment for customers. This is a very important transformation in my view, since it helps to streamline processes. The problem of synchronization between design and engineering environment is well-known and not solved in many companies. Teamcenter is connecting BOM management into varietly of topics such as part management, master data management, configuration management, coordinate change and variability and others. It helps to create a solid platform to manage product data.

However, the biggest fight over the BOM is between PLM and ERP environments. Engineering.com outlined it in their article – The next big boom in PLM is a battle over MBOM ownership. Muris Capital Advisors outlined the sam conflict in the blog post – The Battle for BOM Control. According to Bruce Boes of Muris Capital, service integrators will play a leading role in making alignment between PLM and ERP and forming BOM master model. Here is an interesting passage:

We predict that System Integrators have a unique opportunity and from our recent experience, the desire to bridge the gap and add value during integration with the BOM as a key point of integration.  In doing so they open the market for process consulting and integration services surrounding the master model concept. 

The last one make sense. In many PLM implementation projects, SI teams are actually leading development of PLM-ERP integration on site or using different middleware or integration toolkits. Unfortunately, the cost of these implementation is high and overall process is very complex.

What is my conclusion? PLM vendors redefining BOM by tight integrating of product information into development processes. From what I can see, both Teamcenter and ENOVIA are trying to redefine Bill of Material (BOM) as a wider topic. This is an interesting strategy to fight over MBOM ownership. Integrated “product definition” can help to streamline processes between engineering and manufacturing. However, the end game should be total BOM experience including all manufacturing aspects – manufacturing process planning, cost and orders. The last one brings PLM-ERP integration topic back on the table. Just my thoughts…

Best, Oleg

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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.