Spreadsheets vs PLM dilemma to manage BoM

Bill of Materials (BoM) is a vital part of every product definition. In engineering and product development everything starts and stops with the development of BoM. It is essential for complex products such as aircraft and automobile. But BoM is equally important for small hardware startup just getting off the ground to develop prototype and manufacturing first initial product batch. Read more in my earlier article  – 5 elements of PLM for hardware startup. But BoM just looks easy from the beginning. As you are moving forward into product development, lifecycle, configurations, maintenance, support, you can discover multiple dimensions of BoM management complexity.

BoM management is an essential part of every PLM system today. At the same time, complexity of existing PLM tools and high cost are creating difficulties to manage BoM using PLM tools. As you can see from the following two reports, Excel is considered as #1 BoM management tools by CIMdata – leader analyst company in product lifecycle management.

I captured results of another research made by manufacturing consulting and service company – Dragon Innovation. The research shows that majority of their customers are using Excel spreadsheets to manage BoM and even don’t know what “PDM” stands for.

So, spreadsheets vs. PDM / PLM tool? This is a dilemma for many companies of any size – small hardware startups and large global manufacturers. If you are a small company, Fictiv blog article – How to build a BoM? gives you a recipe to follow explaining how to create BoM and what tools to use. In a nutshell, the recommendation is to use spreadsheets and migrate to PLM tools within time, as you product and development process is getting more complicated.

Keeping track of BOM spreadsheets is bearable with 1 product, but when you have multiple products, it can become a headache quickly. A PLM (product life management) system is a BOM, master parts list, and process management tool all in one. Before you get ready to do a pre-production build, have all the engineers review the latest BOM together, then lock down this version for the build and communicate its version number to the manufacturing partner.

The number of articles about BoM management and PLM is large. But of the less known resource could be Teamcenter blog about BoM management. I found the following article specially interesting if you are focusing on complex products – PLM BOM and the Next Generation Design Paradigm for the World’s Most Massive and Complex Products.

PLM BOM systems poses many challenges. The current approach relies on hierarchical product structures consisting of many levels in a tree-like structure that captures organizational nodes as well as nodes with associated product data such as CAD files, documents and usage specific attributes. However, for defining a massive and complex product consisting of millions of parts and welds, where each individual node as well as parent nodes consisting of a collection of individual nodes that can have their own lifecycle and revisions, the traditional PLM BOM data management techniques reveal a significant number of challenges.

At the same time, migrating to PLM system can cost hardware company agility and speed. I captured the following video with Scott Miller of Dragon Innovation speaking about BoM add-on template Dragon developed for Google Spreadsheet. Watch the video from the <3:30> min where Scott is speaking about his PLM experience back in iRobot.

My favorite quote at 3:30 of the video. “Nothing stops us faster than Windchill. PLM can put us in a dead stop when we are trying to get product out”.

PLM vendors are making progress meantime and you can find BoM management tools in every PLM product portfolio. These tools are various depending on your requirements and product environment. You can consider  mature tools like Teamcenter, Windchill and Enovia to manage complex product configurations (especially if it involves lot of 3D CAD work associated with BoM). At the same time, newer cloud based tools such as Arena and Autodesk PLM360 can be a better alternatives won’t require significant IT resources and provides a nicer user experience.

What is my conclusion? Spreadsheets are easy to start. You can pull data, make changes and keep it flexible. But within time, spreadsheet management will add an additional cost and complexity on every change you want to do. Companies are considering to hire Chief Excel Officer to manage BoM spreadsheets. At the same time, PLM tools are complex. Even the most flexible cloud tool can put you in a dead stop on your way to make a progress in product engineering, manufacturing and delivery if don’t put enough resources and plan it upfront your PLM implementation. Just my thoughts…

Best, Oleg

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