Managing Multi-Level BOMs
Bill of Material Formats
Well-made products are documented with well-made bill of materials (BOM). This list of items, parts, assemblies and sub-assemblies representing the product design (EBOM), or how the product is manufactured (MBOM), serves as a way to maintain an accurate list of required components.
A multi-level BOM, also referred to as an indented BOM, depicts parent-child relationships and shows the hierarchical structure of assemblies and their related parts and components. A multi-level BOM is essentially a nested list whose parts or items are listed in two or more levels of detail to illustrate multiple assemblies within a product’s BOM. In contrast, a single-level BOM depicts one level of children in an assembly and only the components needed to make that assembly are listed.
Multi-level BOM Example
Choosing which BOM Structure to Use
To define the BOM structure that best suits your needs, it is important to consider who will be using the BOM as well as the type of product you build using the BOM. Ask yourself the following questions. Will your BOM be used in-house for engineering purposes? Will your BOM be shared with a contract manufacturer, partner or other collaborator? What types of products do you make? What is the complexity and configurability of your products? These are just a few important factors to consider when structuring your bill of materials. We address each of these in more detail below.
For in-house engineering use, BOM structure may vary based on the engineering discipline. Designers and mechanical engineers often prefer a BOM with nested sub-assemblies as the sub-assemblies can be leveraged across various product designs. In these cases, the BOM often depicts custom designed components and provides critical information about the structure of the product. Electrical engineers, on the other hand, prefer BOMs that are not nested, as they generally capture off-the-shelf components. Here, the way in which the components are wired together (the schematic) is important to the engineer, but not to the overall structure of the bill of materials.
When sharing BOMs with a contract manufacturer, partner or collaborator, it can be helpful to use a BOM with some structure. Nesting and creating sub-assemblies within your BOM allows you to isolate specific sub-assemblies, so you can share only the design data that you need your partner or CM to see. If your partner is helping you with a design, you might choose to share just the sub-assembly that relates to their work, thereby protecting the intellectual property associated with the other aspects of the product design.
A multi-level BOM is also helpful when you have complex and highly configurable products. Updating a sub-assembly within a larger product assembly can be done quickly if you have structured your BOM as multi-leveled, since a change order only needs to address a subset of the product. The sub-assembly can be revised and used in multiple higher level assemblies as necessary. The higher level assemblies only need to be revised as far up the product structure tree as form fit and function rules dictate.
A multi-level BOM can also reduce risk when you have products that use parts with long lead times, high inventory costs or single source vendors. A BOM with sub-assemblies allows your operations group to pinpoint potential alternatives to expensive parts and provides better visibility into assemblies and sub-assemblies that may require extra work. Ultimately this structure can help address problems that may arise before or during the manufacturing process.
By taking into consideration the stakeholders who use the BOM and the types of products you build, you can better determine the BOM structure that is right for your organization.
The Difficulties of Managing Multi-Level BOMs in Excel
Excel BOM spreadsheets are a common tool for small and mid-size manufacturers just beginning to manage product data. But while Excel offers some initial benefits—it is essentially free and easily accessible—managing multi-level BOMs in Excel can be extremely tedious and time consuming.
Because every cell in an Excel BOM requires a manual touch (data entry, copy-and-paste, formula creation, etc.) it is easy to make a mistake, which means continual manual review is necessary to ensure entries and changes are correct. This is manageable when your BOM is just a few items, but when you are working with indented BOMs containing hundreds or thousands of parts, manually reviewing each and every cell is not scalable. And while Excel is great at analyzing numeric data, rolling up BOM quantity and cost information in a spreadsheet can be overly complicated in the case of deeply nested parent-child relationships.
If you are planning to use Excel to manage multi-level BOMs, there are a few questions you may want to answer first. Can you mitigate the risks of manual data entry? Is the inability to quickly gather cost data going to be a problem for your organization?
How Arena PLM Helps Manage Multi-Level BOMs
Arena PLM, bill of materials and change management, offers a more efficient approach to managing multi-level BOMs than Excel. Because the software is built on a relational database, you can create an unlimited number of one-to-many and many-to-many relationships, which prevents data entry mistakes and eliminates product data ambiguity. You can also mass replace a single part in several locations within a BOM or in multiple disparate BOMs—saving hours of time and eliminating BOM discrepancies.
Additionally, Arena PLM enables you to capture and analyze material cost information on indented BOMs. With product information stored in Arena PLM, it is possible to track component-level estimates and quotes from your suppliers. Thus, you can calculate the cost of an assembly from quotes, past purchases or estimated costs. Because you have access to real-time costing information across all your multi-level BOMs in Arena PLM, you can realize what impact product cost will have on profitability.