What Is a Bill of Materials (BOM)?

Your digital transformation starts with the Bill of Materials or BOM. In fact, a BOM is the key to manufacturing agility. 

What is a BOM?

The bill of materials is the comprehensive list of all the inputs required to manufacture a product. It stipulates raw materials, components, and instructions, and is normally created in a hierarchical format. This format indicates the finished product at the highest level, and subordinate inputs nested below, each within it’s appropriate sub-component. The BOM centralizes all the information needed to manufacture the product it defines.

The importance of a Bill of Materials

A well-structured bill of materials is critical for enabling engineering processes and, for more advanced product lifecycle management (PLM) implementations, informing downstream processes in manufacturing and service. And thus, for manufacturing companies the BOM serves as a foundational component of any digital thread initiative. With digital transformation in its various forms becoming a competitive differentiator, it’s more important than ever to consider the value of your BOM strategy.

The purpose of a BOM

What is the perfect digital product representation (or BOM)? It needs to be fit for purpose for your product and company. On one end of the spectrum is a company that designs and manufactures furniture. On the other end is a company that designs and manufactures CAT scan machines. It’s easy to understand that the digital definition of a sofa or chair is far different than one representing a CAT scan machine – the latter will include far more information about the product.

With that in mind, the goal is to create the simplest, and most accurate digital representation possible and then make it fit for use across the enterprise. After all, each stakeholder – from engineering, manufacturing, and sourcing to sales, marketing, service, and quality – will need to use the BOM in different ways to suit their purposes.

What are the types of Bill of Materials?

Engineering BOM

The engineering bill of materials, or EBOM, defines elements, parts and assemblies designed by the engineering department. It generally indicates the component structure from a functional perspective, including a mechanical drawing of the products. As a product’s design is revised, more than one EBOM may be created over time.

Manufacturing BOM

The manufacturing bill of materials, or MBOM, includes all the items and sub-assemblies needed to create the final manufactured, shippable product. Information in the MBOM describes how elements in the BOM relate to one another, and is often shared across the enterprise’s integrated business systems, such as ERP, MRP and MES systems.

Service BOM

The SBOM provides a managed view of a given product’s parts or assemblies that can be serviced, or have an impact on service, throughout a product’s lifecycle. It represents the product with a defined set of service-related definitions, helping coordinate service and support of the product over the course of its operational life.

What’s included in an effective BOM?

To be effective, a BOM should include an extensive array of components, each of which serve a specific purpose.

• Levels, showing where parts fit into an overall hierarchy
• Part name, to identify and categorize parts being manufactured – inclusive of mechanical, electrical, and software components
• Part numbers, which, depending on the system, may provide critical information about the part Manufacturer’s name, to further help identify the part or assembly
• Part phase, to indicate where each part fits within the product lifecycle
• Alternate parts, to indicate whether a given piece of the BOM can be swapped for another
• Priority analysis, defining the relative criticality of parts to help prioritize purchasing and manage lead times
• Comments and notes, providing additional detail and documentation
• Descriptions, conveying necessary and/or distinguishing details about each part
• Quantity, indicating how many components are needed
• Procurement specifications, describing how parts are made or purchased

What are the advantages of a BOM?

The advantages of a BOM are numerous, and they will manifest in deferent ways depending on industry, product complexity, the go-to-market strategy of your business, its PLM maturity, and many other factors. At a high level, most of these advantages can be categorized in four buckets: Enabling agility, allowing for a part-centric approach, streamlining critical processes, and elevating manufacturing.

Enables agility

Like most manufacturers, you are likely grappling to ensure speed and agility in the face of a growing number of product options and variants. Homegrown BOM management tools and processes make it challenging to find and ensure traceability and associativity of the right product information. To embrace agile, you need a seamless flow of information between the teams designing and developing products, planning for the manufacture of the products, and selling and servicing the products. A digital BOM that fully represents the product is the answer.

This complete digital representation of a product(s) and a single source of truth for all related artifacts (e.g., CAD models, drawings, requirements, part structures) delivers many benefits. It can help optimize key business processes, enhance product quality by eliminating mistakes associated with duplicate or incomplete data, and identify problems earlier in the development process. Simply put, a digital BOM yields numerous benefits, including organizational agility, faster time to market, simplified processes, and lower costs.

Allows for a part-centric approach

By adopting a part-centric approach to managing your BOM, you can satisfy all stakeholder needs while fostering collaboration from the point of product conception through manufacturing, device connectivity, and field service. The first step is integrating product data – including that in CAD and ERP systems – in a single repository.

This consolidation makes it much simpler to develop a BOM because it minimizes the number of interfaces to manage, eliminates data latency, simplifies data structures, and more. Moreover, a single source of data truth makes it easier to consistently manage the BOM throughout the entire product lifecycle and ensure that BOM information is accurate and timely.

Many manufacturers are achieving this by using product lifecycle management (PLM) software that includes BOM management and transformation capabilities. 

Streamlines critical processes

With this approach, your product designers create and manage a part-centric digital product that can be leveraged at every step of the product lifecycle. Mechanical, software, electronic parts and related artifacts can be integrated into engineering BOMs.

This provides your organization with a single interface for collaboration between domain systems including CAD and ERP. The PLM system ensures that everyone from the shop floor worker to the service technician to the seller configuring a customer order is using the correct product information.That’s because everyone will be referring to the same data, regardless of product form, fit and function and stage in development. Plus, this approach – supported by single sign on and role-based access to a single data repository – even streamlines discussions and collaboration with customers and partners.

Visibility into products while they are in digital form allows your organization and its partners to make decisions that most impact the cost to produce, assemble and service those products downstream. Downstream teams can more easily learn about planned changes and weigh in on the potential impact. Simply put, changes at this stage come at far less cost than changes made once the product has been created or assembled.

Elevates manufacturing

To scale operations and remain competitive in today’s world, your organization must move beyond a drawing-centric product development process to one that focuses on the actual parts that make up products. With the right PLM strategy and system, your organization can capture, configure, and manage product information during every step of the product lifecycle in the form of a complete digital BOM. It’s the first step to agility today and meaningful digital transformation tomorrow.

What role does BOM play in product development?

As we consider in aggregate the many individual benefits of effective, well-managed BOMs and supporting processes, the strategic, business-level importance of the BOM to product development becomes evident. BOMs help ensure that everything needed is in-place before production begins. The resulting reduction in risk - of delays caused by material shortages, for example - translates to measurable financial impact. BOMs help protect product quality by ensuring all parts meet specifications; this in turn protects the customer experience, and thereby the manufacturers brand and bottom line.

Exploring different Bill of Material examples

The BOM is the digital representation of a product that can be developed for lots of different use cases. Examples include:

• Connected manufacturing and service
• Automated simulations
• Artifact creation
• Product performance feedback and traceability
• Any kind of downstream operations in the product development process
  
  

Ready to get started? Download our eBook, “BOM: Foundations for PLM Best Practices”.