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How do you measure and improve the performance and value of your bill of materials?

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A bill of materials (BOM) is a document that lists all the components, materials, and quantities needed to manufacture a product. It is essential for accurate costing, inventory management, and quality control. But how do you measure and improve the performance and value of your BOM? Here are some tips to help you optimize your BOM process.

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1 Define your BOM objectives

Before you start creating or updating your BOM, you need to have a clear idea of what you want to achieve with it. Do you want to reduce costs, improve quality, speed up production, or comply with regulations? Depending on your goals, you may need to include different types of information, such as specifications, sources, suppliers, alternatives, or standards. You should also decide on the level of detail, format, and structure of your BOM.

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Ratinder Kaur

Digital Marketing Lead for AEC (BIM VDC, Laser Scanning, MEP, Structural) | Healthcare | Edtech | SaaS
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Perspective: 1. Regularly verify the accuracy of the BOM to ensure al components and quantities are correct. 2. Perform cost analysis to identify high-cost items and opportunities for cost reduction without compromising quality. 3. Assess supplier performance in terms of cost, quality, and delivery times, and adjust as needed. 4. Standardize components wherever possible to streamline procurement. 5. Utilize BOM management software like Autodesk Fusion Lifecycle, OpenBOM, etc to automate tracking, updates and reporting. 6. Track efficiency metrics such as inventory turnover to identify areas for improvement.

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2 Use a standardized BOM template

To ensure consistency and accuracy across your BOMs, you should use a standardized template that follows the best practices and conventions of your industry and organization. A standardized template can help you avoid errors, duplication, confusion, and miscommunication. It can also make it easier to compare, analyze, and update your BOMs. You can use software tools, such as Excel or specialized BOM software, to create and manage your BOM templates.

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Sourabh Gupta

Sr. Mechanical Engineer (NPD, VAVE & Cad customization) | Locks, Architectural fittings, Appliances, Energy & Automotive
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As per my knowledge and experience level, BOM serves as a communication tool between different departments and suppliers, ensuring that everyone involved in the manufacturing process has the necessary information to do their job effectively. Without a BOM, it would be impossible to manage the complexity of modern manufacturing processes, and it would be difficult to ensure that every product meets the desired quality standards. So its crucial to create customized template to ensure that all departments are at one level.

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3 Validate and verify your BOM data

Once you have filled out your BOM template, you need to check that the data is correct and complete. You should validate your BOM data against the actual product design, specifications, and requirements. You should also verify your BOM data with the relevant stakeholders, such as engineers, designers, suppliers, and customers. You can use software tools, such as CAD or PLM systems, to automate and streamline the validation and verification process.

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Sourabh Gupta

Sr. Mechanical Engineer (NPD, VAVE & Cad customization) | Locks, Architectural fittings, Appliances, Energy & Automotive
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The first step in the process of validating a BOM is to identify the level. There are three levels of BOM which include Finished Products, Sub-Assemblies and Components. The higher the level, the more detailed and thorough the validation will be.The next step is supplier engagement – collect, validate BOM data received from suppliers/manufacturers and standardize manufacturer name, part number, part description as per industry standard taxonomy, also eliminate duplicate parts.Integrate multiple systems to ensure the data is same across functions, manufacturing sites and systems such as ERP, EAM.

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4 Monitor and measure your BOM performance

To improve your BOM performance and value, you need to track and evaluate how well it meets your objectives and expectations. You should define and use key performance indicators (KPIs), such as cost, quality, time, or compliance, to measure your BOM performance. You should also collect and analyze feedback from your BOM users and customers to identify any issues, gaps, or opportunities for improvement.

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5 Update and optimize your BOM regularly

Your BOM is not a static document that you can create once and forget. It is a dynamic document that needs to reflect the changes and developments in your product design, production process, and market conditions. You should update your BOM regularly to incorporate any modifications, substitutions, or enhancements that may affect your product cost, quality, or functionality. You should also optimize your BOM regularly to eliminate any waste, redundancy, or inefficiency that may reduce your product value.

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6 Collaborate and communicate with your BOM team

Your BOM is not a solo project that you can complete on your own. It is a collaborative project that involves multiple people, departments, and functions across your organization and beyond. You should collaborate and communicate with your BOM team effectively to ensure that everyone is on the same page, has access to the latest information, and can contribute to the BOM creation and improvement. You can use software tools, such as cloud-based BOM software, to facilitate and enhance your BOM collaboration and communication.

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7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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How do you measure and improve the performance and value of your bill of materials?

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1 Define your BOM objectives

2 Use a standardized BOM template

3 Validate and verify your BOM data

4 Monitor and measure your BOM performance

5 Update and optimize your BOM regularly

6 Collaborate and communicate with your BOM team

7 Here’s what else to consider

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