Bill of materials management, or BOM for short, is the process of collecting and maintaining the blueprints for the products that a given manufacturing company produces. It is central to the effective operation of companies that produce highly complex or highly configurable products.
It is how the business understands the potentially millions of parts and units of raw materials, configurable product offerings, the permutations of a formula, or proprietary recipe it has at its disposal to meet the new and constantly evolving demands of a highly competitive, often technical industry.
Cause the BOM pulls together all kinds of product information, it is pretty normal that several disciplines (design and engineering, document management, operations, manufacturing, purchasing, contract manufacturers, and more) will consume data contained within the Bill Of Materials record to get the job done right.
In fact, engineers and manufacturers rely so heavily on BOMs that their own special subsets called the engineering bill of materials and the manufacturing bill of materials.
The BOM provides positive results from business activities like parts sourcing, outsourcing, and manufacturing, so it is important to create a BOM that is well organized, correct, and up-to-date. And for companies that outsource manufacturing activities, it is especially important to create an accurate and revision-controlled bill of materials.
It’s better to use a bill of materials management in manufacturing because it helps you make sense of your own product offering.
It sounds obvious, but in practice, it can involve the collection and storage of vast amounts of data, and in an industry that is increasingly collaborative, synthesizing and sharing that data with manufacturing partners to ensure the entire supply chain remains in lockstep with new innovations or changes to BOM specifications for complex products.
Cloud-powered SaaS solutions for BOM management like this example here improve operational efficiency in a few primary ways. First and foremost, they help a business make sense of its own product offering, whether that’s a small set of highly complex products in standard configurations or a broad spectrum of customizable options, both technical and service-oriented.
In any case, it’s vital that any manufacturing enterprise has a single source of truth and a single definition of the product offering, and BOM management systems can provide that.
Proper BOM management is proper change management. In order to maintain the integrity of the entire BOM system, it’s vital that any changes be adequately documented via the organization’s self-defined approval processes.
Indeed, this can present a liability risk as well, since confusion in any type of precise manufacturing is a famous harbinger of risk for employees and end consumers—just ask any automobile company that’s experienced an airbag recall over an improperly approved or tested part or an airline that’s been investigated by the FAA for improperly maintained sub-assemblies in a jet that ended up crashing.
Whether you’re baking loaves of bread at a bakery or enabling your sales force to configure custom telecom solutions for discerning customers, it’s an increasing challenge to manage the vast amounts of data and data exchanges required by the modern-day supply chain.
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