Simplify The BOM

Bill Of Material Complexity

Bills of Material (BOM) in many organizations are unnecessarily complex. Excess complexity increases the number of transactions, computation time for an MRP system, work orders and errors. It also leads to unnecessary "kitting". BOM complexity increases the effort required for cycle counting.

Simplifying the BOM

The key to BOM simplification is simplification of the process. When subassemblies are combined into a single assembly operation on the plant floor, it reduces the need to carry inventory and track inventory at the subassembly level. Linking subassembly operations to the main assembly with Direct Link or Kanban achieves the same result.

A BOM Simplification Example

In the example below, a simple peristaltic pump had three levels of subassembly. By building the entire pump in one location, the company flattened the BOM to a single-level. In addition, most parts were floor-stocked which further reduced warehouse inventories and transactions. The result was a 26% reduction in part numbers and associated transactions.

Most BOMs have more than the three levels in this example and the resulting benefits of simplification are correspondingly greater.

Figure 10-- Peristaltic Pump