The role of Bill of Materials (BOM) in PLM competition

It is hard to overestimate the value of the bill of materials (BOM) in product design, engineering, and manufacturing. It is everywhere – product design and configuration, engineering, manufacturing, operation, etc. BOM is equally important and complex. In my earlier articles, I touched multiple dimensions of BOM complexity – disciplines, product lifecycle, changes. PLM vendors are focusing on a high level of integration of product information into the development process. A few months ago in my article When BOM is not BOM, I touched some of the aspects of BOM complexity and how it related to BOM ownership, BOM errors, and the future battle for MBOM ownership between PLM and ERP.

Actually, the battle between PLM vendors for superior BOM solution can be even more interesting. Engineering.com article – Volkswagen’s Epic Challenge to synchronize PLM for its Truck Brands brings a very interesting story about the German automotive giant trying to unify PLM solution across its commercial vehicle brands. Take some of your lunch or evening time and read the article.

The example of Scania brings up the value of well-integrated PLM solution to support vehicle configuration and manufacturing.

The secret to Scania’s success is a sales model where product development and modular manufacturing processes are interwoven with sales into a holistic system. The company is known for its tailor-made vehicles. Scania’s PLM plays a big role in its business model. Scania uses Dassault’s (DS) CATIA V5 while ENOVIA V5 serves as the CAD vault. PDM functionality is handled via Scania’s proprietary OAS platform which defines the rules for how the components can be assembled. The OAS works as a product database, configuration and structural control solution. CAD geometries are downloaded from the ENOVIA CAD vault in accordance with the configurations delivered by OAS. In terms of the eBOM and the mBOM, it’s once again about OAS and its couplings to ENOVIA. The company’s manufacturing solutions can’t handle many variations; you have to prepare one at a time and make them individually for each truck.

For some your it might be a big surprise, but according to the article, Excel is a key element of PLM solution used by another vehicle manufacturer. MAN is using Excel-based technology to work with EBOM and MBOM.

MAN uses both Dassault’s CATIA V5 and PTC’s ProEngineer/CREO. After a succesful pilot last year that considered product development (ie, not production), the company chose PTC’s PDMLink (part of Windchill) for their CAD vault and PDM system. Configuration and structural control is principally handled via an Excel Integration with PDM Link. The eBOM (engineering BOM) and the mBOM (manufacturing BOM) are produced by PDM Link via the Excel integration, picking up the parts from the CAD vault. The implementation of PDM Link is under way but at a low speed in anticipation of a final PLM decision.

The story of MAN and Scania made me think about the importance of BOM management in complex product configurations and vertical integration with manufacturing. Build to order or engineering to order environments are extremely complex and require fine-tuned integration between engineering bills, configuration parameters (features), and the ability to translate it into manufacturing and as-built environment.

Here is my favorite passage from engineering.com article which put nail in the head of BOM importance.

BOM management issues will be the most crucial and will determine the direction the company takes. Regardless of what VAG decides to do, the gains that can be made through sharp, highly automated BOM creation and MDM (Master Data Management) solutions is significant. The advanatge of an MDM solution is that it connects the PLM, MES and ERP systems into seamlessly functioning IT units for the shop floor and manufacturing.

What is my conclusion? Platformization is one of the trends in modern PLM according to CIMdata. The example of VW shows the importance of BOM management in order to provide robust and scalable PLM solutions for complex automotive manufacturing. My hunch BOM will become one of the most important weapons PLM vendors will be used to differentiate future PLM platforms. Just my thoughts…

Best, Oleg

Disclaimer: I’m co-founder and CEO of OpenBOM developing a digital network platform that manages product data and connects manufacturers and their supply chain networks.