BOM 101: How Many Levels Do You Need in BOM?

I’m continue my BOM 101 series of posts. When working on bill of materials, you can often hear about the ability of BOM management software to support so-called "multi-level" BOM. You can search for the definition of multi-level BOM using Google and find many results. I found the following definition of multi-level BOM on Arena website quite balanced. Here is the passage from the Mult-level BOM article:

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.

In the past, when BOM was managed using paper and spreadsheets, to create multi-level BOM wasn’t a simple task. Computer systems create an opportunity to manage and manipulate easily with multiple levels of BOM. However, the question people are asking usually – how many levels of BOM do we need? This simple question is actually leads to many interesting discussions. From my practice it related to many factors. The most typical are – type of BOM (engineering, manufacturing, support), type of the product, maturity of product development and many others.

I found an interesting writeup about BOM levels in the Frank Watts’ book – Configuration Management Metrics. Navigate to the following link – I was able to access this book fragment using Google Books. Here is an interesting passage:

The tendencies of the companies to create multi-level assembly structures seems to be overwhelming. This analyst has witnessed 11 levels at a couple of companies and had a seminar attendee tell about 16 levels. Many departments wish to add structure for their apparent need and many needs are not in best interest of the company as a whole. Because agreement cannot be reached on one structure, often an "Engineering BOM" and a "Manufacturing BOM" are created. Often a material folks create "Planning BOM". Many times various department can reach agreement only by adding additional layers to the BOM.

The following diagram shows the number of levels in BOM correlated to maturity of product development. The analyst believes a better communication can be achieved by creating a BOM with minimum levels of structure.

What is my conclusion? The fact you can create multiple levels of BOM doesn’t mean you need to utilize it at full capacity. Multi-level BOMs are complicated and adding an additional work in the process of changes. How to maintain the right number of BOM levels? I’m interested to learn more about your experience. How many BOM levels do you have in your company ERP/MRP/PDM/PLM system? Speak your mind.

Best, Oleg

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3 Responses to BOM 101: How Many Levels Do You Need in BOM?

  1. Dijon says:

    On average our EBOMs in PLM contain fifteen to twenty levels of indenture in a hierarchy representing a final product in its entirety. In part that is driven by change management practices in our particular industry because component part numbers are substituted, instead of a revision of the existing part number being issued, whenever an update occurs which impacts interchangeability (fit, form, function, etc.). We do revise part numbers but only for minor class changes which can be bin mixed on the factory floor without ill affect. When down part numbers are interchanged the next higher assembly needs to up revved to reflect that. If many thousands of pieces in an EBOM all reported to a consolidated parent then that parent would be in a constant/frequent state of change due to all the activity taking place with its children.

    In contrast MBOMs in ERP and PLM are much flatter; those are typically two to five levels deep.

    Other forms of BOM structures will fall somewhere between those two extremes.

    So what we experience are contractions and expansions in BOM structure complexity depending on the owning department.

  2. @Dijon, thanks for sharing your experience. You are clearly balance between engineering needs and ECO challenges and manufacturing simplicity. Interesting. What process /tools are you using to consolidate engineering to manufacturing BOMs? Thanks, Oleg

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