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.
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Figure 10-- Peristaltic Pump
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