BOM Management: From Design to Procurement Explained

A Bill of Materials (BOM) is a comprehensive list of all components, assemblies, and sub-assemblies required to manufacture a product. It’s an absolutely essential document that helps companies bridge the gap between traditionally siloed design and production teams to maintain accuracy, efficiency, and cost-effectiveness throughout the product life cycle.

Understanding the Importance of BOMs

With that in mind, it’s clear that BOMs play a crucial role in the product development lifecycle, but which teams do they really impact and why? 

• Procurement: Identifying necessary components and suppliers.
• Manufacturing: Guiding the assembly process and ensuring correct component usage.
• Quality Control: Verifying product integrity and compliance with specifications.
• Costing: Estimating production costs and managing budgets. 

For each of these teams, a sufficiently managed BOM helps to streamline operations, reduce errors, and improve overall product quality—each increasingly important factor at a point in time when products have to exceed expectations and come to market rapidly for demanding consumers. 

Part Selection and Specification

A final product is only ever as good as the components used within its design. When selecting them, don’t forget to consider the following factors: 

• Cost: Evaluate the cost-effectiveness of different options, considering factors like bulk discounts, lead times, and potential hidden costs.
• Availability: Ensure components can be sourced reliably and in a timely manner, especially for critical parts or during peak demand periods.
• Performance: Choose components that meet or exceed the required specifications, taking into account factors like power consumption, operating temperature range, and reliability.
• Reliability: Consider the component's track record and mean time between failures (MTBF), particularly for critical applications where downtime can have significant consequences.
• Compatibility: Verify compatibility with other components in your design, including factors like pinouts, power requirements, and signal integrity.
• Future obsolescence: Assess the likelihood of the component becoming obsolete, especially for long-term projects, and consider alternative options or design changes if necessary.

The Importance of Accurate Specs

Accurate part specifications are vital for designers looking to optimize their creations. Here’s what "getting it right" is essential for: 

• Correct component selection: Ensuring that components meet the design requirements and avoid compatibility issues. 
• Efficiency manufacturing: Providing clear instructions for assembly and testing, thereby reducing errors and mitigating potential rework.
• Quality control: Verifying that products meet standards and specifications, which guarantees product quality and reliability for the end-consumer.
• Procurement: Accurate specifications facilitate accurate sourcing and pricing, assisting in the avoidance of unnecessary costs or delays.

Using Altium's Component Libraries

Component libraries found within Altium’s suite of tools offer a vast repository of pre-defined components, which makes selection and specification more efficient for designers. These libraries include: 

• Manufacturer-specific libraries: Providing access to components from leading suppliers, often with detailed specifications and datasheets. 
• Custom libraries: Allowing you to create and manage your own component database tailored to your specific design needs. 
• Symbol and footprint libraries: Ensuring consistency and accuracy in your designs, reducing errors, and improving design efficiency.

Through the use of Altium’s suite, designers can maintain a centralized database of components, which helps in managing and tracking changes and iterations over time, providing a time save for busy teams, reducing potential errors, and helping in the creation of designs that are both effective and efficient. 

BOM Creation and Structure

There are several types of BOMs, with the most common being the manufacturing BOM (MBOM), which provides a detailed list of all components required for production. Here are other variations:

• Assembly BOM (ABOM): A simplified version focused on the components needed for final assembly.
• Purchasing BOM (PBOM): A list of components to be purchased from external suppliers.
• Service BOM: A list of components required for maintenance, repair, or overhaul. 

Essential Elements of a BOM

A well-structured BOM typically includes the following elements: 

• Part number: A unique identifier for each component. 
• Description: A detailed description of the component, including specifications, materials, and dimensions.
• Quantity: The number of components required for each unit of the product. 
• Supplier: The name and contact information of the supplier, if applicable.
• Revision level: The current version of the BOM, indicating changes or updates. 
• Drawing number: A reference to the associated design drawing or schematic.
• Cost: The estimated cost of the component. 
• Lead time: The estimated delivery time from the supplier. 

Best Practices for BOM Structure and Organization

It’s important for teams to make sure that BOMs are clear, accurate, and efficient. To do so, they should follow these best practices: 

• Use a consistent format: Adhere to a standardized format for BOMs to maintain consistency and avoid confusion.
• Group components logically: Organize components into logical groups or categories based on function, type, or supplier. 
• Provide clear and concise descriptions: Avoid ambiguity by providing detailed but concise descriptions of components.
• Include relevant attributes: Ensure that your BOM includes necessary attributes such as part numbers, quantities, suppliers, and drawing references.
• Regularly review and update: Periodically review and update your BOMs to reflect changes in design, specifications, or supplier information.
• Consider using a BOM management tool: Automate tasks, track changes, and ensure accuracy by using a dedicated BOM management tool.

By following these guidelines, you can create well-structured and informative BOMs that support the manufacturing, procurement, and quality control processes with ease. 

BOM Validation and Review

If you want to have a successful manufacturing experience and for product quality to be top-notch, it should go without saying that an accurate and complete BOM is mission-critical. Altium’s BOM management tools offer various features to validate and review your documentation, including:

• the automatic detection and highlighting of errors in your BOM, such as missing or incorrect part numbers, quantities, or specifications;
• verification that components are referenced correctly in your design files to prevent inconsistencies and errors;
• making sure that your BOM complies with design rules and standards, such as component placement, clearance requirements, and electrical rules;
• verification that all components in your BOM are included in your component libraries to guarantee accuracy and consistency; and
• conducting formal design reviews to assess the accuracy and completeness of your BOM, involving relevant stakeholders from different teams—removing unnecessary silos that traditionally delayed processes and led to inconsistency. 

BOM Release and Distribution

Once your BOM has been validated and reviewed, it can be released for manufacturing. The release process typically involves the following steps:

1. Approval: Obtain approval from relevant stakeholders, such as engineering managers, procurement teams, and manufacturing personnel. 
2. Version control: Assign a unique version number to the released BOM to track changes and updates.
3. Distribution: Distribute the released BOM to all relevant parties, including manufacturing teams, suppliers, and quality control.
4. Change management: Establish procedures for managing changes to the released BOM so that all stakeholders remain informed and updated. 

Version Control and Change Management

Effective version control and change management are pretty much non-negotiable if you want to maintain the integrity of a BOM. To make sure that everybody is singing from the same song sheet, consider implementing a version control system to track changes and maintain a history of iterations; clearly document any modifications, including the reason, affected components, and potential impacts; communicate these changes to all relevant stakeholders to keep them informed; and, finally, establish a formal review process to evaluate and approve changes—this will give multiple stakeholders the opportunity to make sure that changes make sense, are necessary, and do not compromise product quality or functionality.

BOM Procurement and Supply Chain Management

Integration of BOM with Procurement Systems

For procurement teams, BOMs can be integrated into their day-to-day systems, which opens the door to the automation of various tasks, including the automatic identification of suppliers based on custom specifications and sourcing preferences; the creation of accurate purchase orders directly from the BOM; and the tracking of component inventory levels and automatic reordering of low stock to keep the flow going. 

Supplier Management and Relationship Building

For all companies, regardless of industry, effective supplier management helps in the effort to maintain a reliable and cost-effective supply chain. Make sure to evaluate potential suppliers based on factors such as quality, reliability, pricing, and delivery performance; establish clear processes for onboarding new suppliers, from contract negotiation and quality assurance to payment terms; monitor supplier performance to identify areas for improvement and address any issues; and aim to build strong partnerships with suppliers through open communication, collaboration, and a show of mutual trust. 

Risk Mitigation Strategies for Supply Chain Disruptions

Now more than ever, supply chain disruptions are prevalent. Ranging from the recent pandemic geopolitical tensions to shipping lane obstructions and damage to busy ports, disruptions have, at times, brought the international supply chain under scrutiny for being both fragile and inefficient. For businesses, it’s important to implement risk mitigation strategies to reduce the potential consequences. Companies could:

• Source components from multiple suppliers to reduce reliance on any single source;
• go against the JIT methodology that dominates modern supply chains and maintain appropriate inventory levels to buffer against disruptions;
• develop contingency plans to address potential disruptions; and
• regularly assess supply chain risks and implement measures to mitigate them ahead of time. 

BOM Updates and Revisions

Engineering change orders (ECOs) are a common occurrence throughout the product development process; when an ECO is implemented, it is essential to update your BOM accordingly. This involves identifying affected components, updating specs, revising the BOM, and notifying stakeholders.

If changes to the BOM are necessary during the manufacturing process, evaluate the impact, obtain approval, implement changes, document changes, and update stakeholders. Changes to the BOM can impact production schedules in a big way, so remember to consider lead times, costs, and the time and value of reworks.

BOM Management Tools and Automation

Altium offers a suite of powerful tools designed to streamline the BOM management process. These tools include a BOM generator that automatically generates BOMs based on your design data, a BOM editor for editing and modifying BOMs, a BOM validation tool to check for errors, and BOM integration with other Altium tools for a streamlined workflow.

To create a more efficient design and manufacturing process, you can integrate Altium's BOM management with other design and manufacturing tools, such as ERP systems, PLM systems, and CAM software.

By carefully managing engineering changes and updates, you can reduce the impact on production schedules and costs while ensuring product quality and compliance with specifications.

Don’t forget that great BOM management is a cornerstone of successful product development and manufacturing. By adhering to the guidelines provided, you can improve efficiency, reduce costs, enhance end-product quality, and create a better form of collaboration between siloed teams. Explore Altium 365 BOM Portal to see how it can transform your design and manufacturing process.