Bill of Materials (BOM) and product lifecycle open loops

May 19, 2015

integration-loop-bom

It is hard overestimate the importance of Bill of Materials for product development. In my keynote at ProSTEP iViP symposium in Stuttgart earlier this month I’ve been sharing my thoughts why developing of single BOM across multiple disciplines in critical for organization. I wanted to bring few examples that can demonstrate why having a single BOM strategy can bring benefits to product development and manufacturing organization.

Earlier today, at Siemens PLM connection event in Dallas, I captured the following slide demonstrating an integrated approach in design, manufacturing, planning and production. What is really interesting is how as-design, as-planned and as-build views in PLM are integrated with design, manufacturing, planning and production.

integrated-bom-plm-mes-mom

Few days ago, I the following article by 3D CAD World article caught my attention – Progress in closing the product lifecycle’s loops  by Peter Bilello, president of CIMdata. The article speaks about the importance of collaboration across diverse enterprise groups.

For many years, the PLM industry has greatly benefited from a steady stream of improvements in collaboration among ever more diverse enterprise groups—in data interoperability, for example, and in the transparency of workflows and processes. The development, manufacture and support of globally competitive new products are, however, still hamstrung by the remaining open loops new and old.

Later in the article it came to the topic I was looking for – Bill of Materials. According to article, BOM is a biggest remaining challenge to make integration running smooth. Here is the passage, which explains that.

Between engineering, manufacturing and finance, a big remaining challenge is the bill of materials (BOM) in its many forms—the as-designed BOM, the as-engineered BOM, the as-manufactured BOM, and so on. Generated and managed with PLM and often executed by enterprise resource planning (ERP) systems, BOMs themselves are loop closers. PLM-ERP connectivity and interoperability are steadily improving, but some open-loop issues are resolved only after time consuming face-to-face meetings.

What is my conclusion? Single BOM could be a great thing if vendors will figure out how to implement that. As you can learn from Biello’s article, PLM-ERP has open-loop issue and BOM is a tool to close that. However, companies are concerned about bringing single BOM strategy since it can raise lot of organizational challenges for them. At the same time, the demand for better integration and collaboration can put companies in front of decision to bring single BOM to close open loops between engineering, manufacturing and production anyway. Just my thoughts…

Best, Oleg

Image courtesy of Stuart Miles at FreeDigitalPhotos.net

 


PLM and ERP: Separated by a common Bill of Materials (BOM)

May 6, 2015

bom-lifecycle

Yesterday, I had a privilege to share my thoughts about Bill of Materials and BOM management during my keynote at ProSTEP iViP Symposium in Stuttgart. That was my first time at ProSTEP conference. The first day is over. I will be publishing  updates in my live blog here.

The discussion about Bill of Materials is always interesting and entertaining. BOM is a centerpiece of every engineering solution. As an organization you have to manage different aspects of Bill of Materials during design, engineering, manufacturing and support stages. These days, as companies are moving from selling products into services, support and maintenance BOM is getting more into the focus of discussions. After all, Bill of Materials is complex topic. On the following picture you can see multiple dimensions of BOM complexity:

bom-complexity-1

In every organization, Bill of Materials has two notions  – technical and political. The first one is absolutely important. The following three characteristics are absolutely important if you think about reliable BOM management solution: 1/ ability to manage multi-disciplinary data; 2/ scalability; 3/ user acceptance. User acceptance is a tricky thing. The demands of people in an organization about BOM are different. Engineering, manufacturing, support, supply chain, sales – these organizations have want to see BOM differently.

enterprise-bom

However, regardless on the role of a person in organization, the following demands are absolutely critical: 1/ No errors (each mistake in BOM is painful and can lead to significant problems in an organization ; 2/ No painful date re-entry (nobody wants to enter information into BOM multiple times); 3/ No painful synchronization of data between PLM, ERP and other systems.

bom-management-demands

Below you can find a full deck of my presentation:

PLM and ERP: Separated by a common Bill of Materials (BOM) from Oleg Shilovitsky

What is my conclusion? Bill of Materials and BOM is a very interesting topic. My hunch, it is getting even more in the focus of people as products are getting more complex. These days every single product is a combination of mechanical, electronics and software. Manufacturing companies are selling it as a services. Customers are demanding configurability, high quality and low cost. How to manage all these things together? The following three questions are absolutely important when you think about BOM management – 1/ How to support connected processes in an organization? 2/ How to stop synchronizing BOM between silos (PLM, ERP and others)? 3/ How PLM and ERP can support a concept of “single BOM”? Just my thoughts…

Best, Oleg

PS. If you want to discuss more about BOM management, please feel free to contact me directly.

 


How to prevent cloud PLM integration mistakes

February 2, 2015

connected-plm-erp

Cloud is huge enabler for collaboration between people. It makes your data and processes accessible everywhere from a browser. It can help you to collaborate between engineers and suppliers. It can help you to integrate systems and people across enterprise.

Let me speak about the last one. The integration topic is actually tricky. I’ve been sharing some of my thoughts about cloud integration challenges – Integration is holding back PLM cloud adoption few months ago. Last week, I had a chance to attend two webinars about PLM and integration.

Become a Connected Manufacturing Enterprise with Agile Integration by Jitterbit. The following picture gives you a perspective on a problem of “connected manufacturing” and architecture solutions like Autodesk PLM360 and Jitterbit are solving this problem.

plm360-jitterbit-1

Here is the view that shows you the reality of mixed (cloud and on-premise) integrations.

plm360-jitterbit-2

Another webinar by CIMdata – “PLM & ERP: What’s the Difference, and Why Should you Care?” is providing another perspective on integration challenges between engineering an manufacturing.

cimdata-plm-erp-1

cimdata-plm-erp-2

Companies are moving into mixed cloud and on premise environment. This is a reality and we cannot avoid it. So, for a foreseeable future, we will have to deal with integration of multiple systems – some of them will continue to run on premises and some of them will be elsewhere (public cloud). It made me think about potential mistakes you can run into while integrating systems.

1- Lost data semantics

Most of integration scenarios are about how to send data back and forth between systems. It is hard to keep semantics of data and not to loose it when exchanging information. So, define what data means and keep an overall integration data schema. Otherwise, the result can be messy.

2- Data transfer limitation

Although some of integration infrastructure can allow you to implement data exchange quickly, you can underestimate the bandwidth requirements. Sending large packets of data can cause significant latency and create runtime errors and problems. Check what monitoring tools are available to handle such situations.

3- Transaction management

Most of manufacturing systems are sensitive to transactions. To manage distributed transactions can be tricky and require some fine tuning. Pay attention on how you handle error processing when integrating transaction system managing ordering, lifecycle and bill of materials.

What is my conclusion? The complexity of integration is growing. Cloud systems are bringing many advantages, but will create additional challenges to IT and professional services. Most of integrations are not working out of the box. New tools running from the cloud can help you to integrate it faster, but it will require good coordination with IT and planning upfront to prevent potential mistakes. Data integration is hard and requires experience and familiarity with manufacturing systems. Just my thoughts…

Best, Oleg

photo credit: freefotouk via photopin cc


When BOM is not BOM

December 17, 2014

walks-like-BOM-quacks-like-BOM

Bill of Materials (BOM) is a central part of everything in product development. Sometimes, people call it product structure. Manufacturers are using BOM to define list of raw materials, parts and sub-assemblies with corresponded quantities need to manufacture a product. This is over simplistic definition. As usual, devil is details and BOM story is getting quite complex. Depends to whom are you talking, people see a different aspects of bill of materials – sales options, design hierarchy, product configurations, manufacturing process, service parts. Many systems are defining BOM differently. It depends on their roles and functions in overall product lifecycle.

In one of my recent articles – Thoughts about BOM ownership, I discussed some ideas about how BOM can be shared among organizations and enterprise software tools. That was my attempt to think about how to resolve a conflict between two major BOM stakeholder – Product Lifecycle Management and ERP systems. The BOM management landscape in the organization is complex. In my view, companies are not ready for a single BOM management tools – it was my observation 2 years ago.

At the time a major BOM master ownership dispute is between PLM and ERP vendors, I can see an interesting trend which can put some lights on how PLM companies are articulating their BOM strategies.

Dassault Systems ENOVIA is coming with their "zero BOM error" strategy. I posted about it earlier – PLM and Zero BOM errors: the devil is in details. In a nutshell, ENOVIA is trying to improve process of Bill of Material generation by direct connection between CATIA design and product structure. In my view, it might lead to potential formal elimination of EBOM, which will be replaced by a bundle of design and engineering information. Practically, product structure in CATIA/ENOVIA will represent everything that happens on engineering level. According to ENOVIA strategy, it will eliminate errors between design and engineering.

In parallel, I’m observing the way BOM is positioned by Siemens PLM. Teamcenter blog – Introducing BOM management speaks about BOM information as a vital part of many processes supported by PLM. I found interesting how "BOM management" term was replaced by "Product definition". Here is the passage:

I just noticed that as I am writing this I am using the words “bill of materials” less and “product definition” more. I would go back and correct – I wanted to keep it a surprise! But I think it’s ok – it helps me get to this next part. To us, it has become abundantly clear that one of the problems that come up when you talk about bill of materials (BOM) management is that the scope of what people might mean is so broad. To call all those things listed above “BOM Management” is not sufficient. We’ve collected these capabilities into an umbrella we call the Integrated Product Definition. This is an area where we have been leaders, and it continues as a high priority for us – we have the breadth and depth to address these issues like nobody else can.

In both situations, I can see a strategy by PLM vendors to redefine BOM and bring up the extended value PLM environment for customers. This is a very important transformation in my view, since it helps to streamline processes. The problem of synchronization between design and engineering environment is well-known and not solved in many companies. Teamcenter is connecting BOM management into varietly of topics such as part management, master data management, configuration management, coordinate change and variability and others. It helps to create a solid platform to manage product data.

However, the biggest fight over the BOM is between PLM and ERP environments. Engineering.com outlined it in their article – The next big boom in PLM is a battle over MBOM ownership. Muris Capital Advisors outlined the sam conflict in the blog post – The Battle for BOM Control. According to Bruce Boes of Muris Capital, service integrators will play a leading role in making alignment between PLM and ERP and forming BOM master model. Here is an interesting passage:

We predict that System Integrators have a unique opportunity and from our recent experience, the desire to bridge the gap and add value during integration with the BOM as a key point of integration. In doing so they open the market for process consulting and integration services surrounding the master model concept.

The last one make sense. In many PLM implementation projects, SI teams are actually leading development of PLM-ERP integration on site or using different middleware or integration toolkits. Unfortunately, the cost of these implementation is high and overall process is very complex.

What is my conclusion? PLM vendors redefining BOM by tight integrating of product information into development processes. From what I can see, both Teamcenter and ENOVIA are trying to redefine Bill of Material (BOM) as a wider topic. This is an interesting strategy to fight over MBOM ownership. Integrated "product definition" can help to streamline processes between engineering and manufacturing. However, the end game should be total BOM experience including all manufacturing aspects – manufacturing process planning, cost and orders. The last one brings PLM-ERP integration topic back on the table. Just my thoughts…

Best, Oleg


SAP has a magic technology to improve enterprise integration

December 4, 2014

digital-integration

Integration is a big deal. When it comes to enterprise organizations and specifically manufacturing companies of different kinds, enterprise integration is one of the major challenges that influence broad PLM adoption and ROI. Enterprise integration isn’t a simple problem to solve. It requires a diverse set of tools to support data exchange and process orchestration. PLM vendors are providing a diverse set of solutions for that. On the side of the strategic position, re PLM companies are expanding their data reach by attempting to cover larger scope of data and process. You can read about it in my post about ECO and EBOM/MBOM synchronization complexity.

My attention caught by betanews article – SAP launches new manufacturing solution to improve enterprise integration. It speaks about new technologies developed on top of new SAP HANA in memory database to manage real time integrations. Here is the passage that gives you a glimpse of what is that about:

SAP Manufacturing Execution includes the SAP Manufacturing Integration and Intelligence (SAP MII) application and SAP Plant Connectivity software. This allows it to provide machine-to-machine integration and orchestrate intelligent manufacturing. Using the existing SAP HANA platform it offers global visibility into operations by making manufacturing big data more accessible and enabling predictive analytics capabilities to be used in house or in the cloud. This gives businesses advanced problem solving ability and ease of access to manufacturing data so they can make improvements in cost, quality, asset utilization and performance.

I’ve been touching SAP HANA topic before in my post – Future PLM platforms and SAP / Oracle technological wars and Is SAP HANA the future of PLM databases.

I’ve made a trip to SAP MII website to dig for more information about integration architecture. Here is an interesting document (with lot of technical details) that worth looking if you are interesting in SAP MII HANA integration – SAP Process Integration Act as Adapter for SAP MII integrating with Enterprise Applications. The document is available here. I captured the following architecture slide that give you a detailed view. More information is available here. From that picture you can see SAP’s view on how PLM and other business apps are going to be integrated with manufacturing and shopfloor system.

sap-mii-architecture

What is my conclusion? Modern manufacturing requires high level of integration. It goes from design and engineering to manufacturing and operation. Data integration and transparency will allow to companies to optimize performance, save cost and streamline processes. However, to make it happen is not a simple job and it requires lot of hard-wiring, data transformation and openness. PLM vendors’ demand to have control over MBOM to make vertical integration easier. As you can see on pictures and documents above SAP is working to create a grand vision of data integration from shopfloor to business applications and services. How and where PLM and ERP vendors will meet to create an integrated manufacturing solution is an interesting question to ask.

Best, Oleg


Engineering change and EBOM to MBOM synchronization complexity

November 27, 2014

eco-mco-ebom-mbom

MBOM (Manufacturing BOM) is a tough problem. Initially, you might think about it as an easy problem. Especially, since companies are managing MBOMs in MRP/ERP systems for a while. However, I think, the time when MBOM was simply originated in MRP system to fulfill demand planning and production orders are gone. And it brings lot of questions and, raise attention from software vendors and implementers. PLM vendors are in the first line of companies demanding the change in the way MBOM is handled.

MBOM is really hard if you want to keep it in sync with rest of product data in engineering and manufacturing. It starts from the moment of time, you understand that your engineering BOM and manufacturing BOM are not the same thing. I touched it earlier in my post – 4 reasons why is hard to deliver MBOM in PLM. The initial creation of MBOM can be technically straightforward. It mostly end up by adding date effectivity element into BOM structure. Within time it gets complicated. And one of the main reasons is synchronization of data. It goes mostly around management of engineering change.

MBOM is a central place to capture the impact of engineering changes and to insure changes are managed correctly and reflected into manufacturing process with relevant dates and references to engineering data (EBOM). The priority of changes are not equal. Organization must handle these priorities and it can result in significant cost differences. Fundamentally you can think about mandatory changes and optional changes. The first one is the change organization will be implementing at any cost. It usually result of failures and regulatory changes. The second one is more interesting. This is where all new development, innovation, design improvements, cost reduction and other things are coming. This is a place where play with effectivity date can be tricky and complex. The sequence of steps are as following:

1- Engineering release or ECO transmit the data about changes in EBOM, which serve as a source of change and provides all required engineering information

2- Manufacturing should introduce these changes into planning process. Timing is important and this process is formal. Some of companies connect it to so called MCO process.

3- All dependencies must be discovered and reflected in changes of MBOM and manufacturing planning.

The last step brings a significant complexity. Engineering information (as it comes from EBOM) often comes incomplete and doesn’t contain all data that must be reflected in a change. There are multiple reasons to that, but in general, engineering view of a product is different from manufacturing one. One of the most typical examples is related to part interchangeability. But, I can see many others too. To synchronize changes between EBOM and MBOM is very complex. However, this complexity and challenges can turn MBOM into next cool thing in PLM.

What is my conclusion? EBOM to MBOM synchronization is a complex process that requires significant data manipulation, data discovery and careful operation. It cannot be automated and it requires a lot of consideration from engineering and manufacturing people. The complexity of modern product and manufacturing processes are introducing the new level of challenges in the way to manage EBOM and MBOM. This sync is critical and companies are demanding tools that can help them to handle it in the right way. Just my thoughts…

Best, Oleg


Why all PLM software will be SaaS soon?

November 26, 2014

plm-cloud-dream

I’ve be sharing many of my thoughts about how different cloud technologies can be used to implement PLM. Nevertheless, once in a while, I’m also getting comments and questions about acceptance of cloud PLM for large companies. Usually, it comes in the intersection of security and readiness of large manufacturing companies for cloud (SaaS) software.

TechMVP article – The benefits of SaaS transformation: both the obvious and non-obvious shows some very interesting perspective on that topic. Let me go straight to security question:

The second common objection stems from the thought process amongst large enterprise CIOs regarding whether to allow certain applications to live outside of the enterprise’s firewall. IT managers and executives – sometimes speaking about legitimate security concerns and sometimes speaking to protect their jobs – stand in the way of core applications moving to the cloud via a SaaS vendor. At the same time, these same decision makers have adopted Salesforce.com for CRM, and allow unencrypted email between employees and non-employees, thus calling into question the sincerity of their argument against other SaaS applications. The successful adoption of CRM in the cloud has opened the floodgates for virtually all other types of applications to move to the cloud even over the objections of certain IT managers.

Towards this end, we have seen in recent years the advent of ERP (FinancialForce, Workday), Marketing Automation (Eloqua, Marketo), and Software Development or ALM (GIT and Rally Software) in the cloud. These types of applications manage information that is often considered the “crown jewels” of corporate data, and thus are the types of applications that some thought would never take root in the cloud.

I can observe a significant growth of SaaS software adoption by manufacturing outside of pure engineering domain. You can see software in different categories – ERP, CRM, marketing, project management, software lifecycle management and many others. Imagine manufacturing product with software code managed using GIT? What will be the point to reject PLM system managing engineering bill of materials in the cloud?

Another interesting perspective is related to creation of new software companies. The graph below demonstrate a complete dominance of news business starting SaaS companies.

saasapps

One more data point is coming closer to PLM business and related to implementation of ERP systems. Panorama consulting solutions published an interesting 2014 ERP report, which speaks about type of ERP systems implemented in 2013. As you can see on-premise and hosted system is accounting together for 96% of all systems.

type-of-erp-software-2013

What is my conclusion? I wonder what percentage of new PLM systems implemented in 2014 will be SaaS. The number is probably not very high. However, traditionally, it takes long time to decide about PLM system. My hunch, that broad adoption of SaaS software in other domains will push manufacturing companies to evaluate more PLM systems and make their decision faster than before. SaaS lower risks and upfront cost, which can be an additional factor for manufacturing companies to taste cloud PLM sooner than later. Just my thoughts…

Best, Oleg

photo credit: Robert Hensley via photopin cc


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