Managing Formula Revisions
Business Case
A Bill of Material revision (or BOM revision) is a list of the parts or components and quantities of each needed to produce an end product or finished good. The parts required may include raw materials, sub-assemblies, intermediate assemblies, or sub-components. BOMs are hierarchical in nature with the top level representing the finished product which may be a sub-assembly or a completed item. In DEACOM, the Bill of Materials also contains information regarding the labor cost necessary to produce the end product or finished good.
BOMs may be created or modified in either the Inventory > Formula Management area or from within Item Master Management via the “Edit BOM” button on the Item Master list. Items may have several different revisions of a formula with one revision being designated as the default. For example, there might be different revisions based on the equipment used to produce the product or different revisions based on different type of items or ingredients.
DEACOM also offers Facility-specific BOM revisions. Manufacturing companies with multiple Facilities in different regions of the US or across the globe may have Bill of Materials for the same part which vary slightly by Facility. For example, one company might use different packaging parts on their finished good BOM revisions due to differences in vendors in the two different regions of their manufacturing. Another company may have a different raw material on the revision based on the region where the Facility is located.
Concerning Unit of Measure changes, one of the primary benefits is that items can be stocked in inventory in one unit of measure and referenced on bills of materials in a different unit of measure. For example, items that need to be stocked by the pound or kilogram can be entered on bills of materials in grams, milligrams or ounces, and still be issued to the production job by the pound or kilogram. Bill of Material line items default the BOM Unit based on the new BOM Unit of the item selected.
MRP Considerations
When using Facility specific BOM’s and running MRP, the Facility must be specified in the MRP pre filter, for indirect requirements to flow to lower level parts. A default BOM Revision may be created for each Facility. When no Facility is specified on the BOM, the default will always be used in MRP to drive indirect requirements, regardless of a Facility being specified in the MRP pre filter.
Costing Considerations
When using Facility specific BOM’s, and the Facilities Tab on the Item Master, BOM cost roll ups will drive to the Item Facility record, rather than the Costs Tab on the Item Master. This enables different standard costs to be used in each Facility.
Configuration
Prior to creating formula revisions in DEACOM, several pieces of master data will need to be setup. In most cases, companies will have already completed these setup steps during the implementation process. The necessary configuration setups are indicated below.
- Items - Items including raw materials and sub-assemblies will need to be created in order to include them on revisions.
- Routings - Optional when creating BOMs, routings are a series of predefined processing steps, listed in order of sequence, necessary to complete a product. Each routing step indicates the work center, the operation that will be performed and the processing rate for the item in units per hour.
- Units of Measure - Units of measure define how items will be stocked, sold, and purchased. In addition, revisions in DEACOM contain the "Formula Unit" field. This field, which is required, is the unit of measure that the manufactured item will be produced in as a result of manufacturing process.
- Formulators - Optional when creating BOMs, formulators are used to indicate the name of individuals or departments responsible for conceiving and maintaining item formulas and bill of materials revisions in formula management.
- Quality Control Groups/Tests - Optional when creating BOMs, QC groups and tests are used to indicate testing required prior to, or following, finishing of a product on a production job.
- User Calculations - Optional when creating BOMs, user calculations allow customers to setup and perform calculations that can be viewed on bills of material. These calculations are available for printing on bill of material related documents.
- Facilities - Facilities define unique or separate locations that concentrate resources such as workers, machinery and other capital. If Facility specific BOM revisions will be used, facilities must be defined in the system.
- Revision Facility Security - Facility specific revision security is available via System > System Maintenance > Revision Facility Security and is used to control which User Groups have access to view or edit specific Facility BOM revisions. When the table is displayed, all active User Groups will be displayed across the top and all active Facilities will be displayed down the left-hand side. In addition, there will be a "None" option on the left-hand side to allow security to be set for BOMs that do not have a Facility defined. When new User Groups or Facilities are added in the system, their access in this table will be defaulted to "No" which means users will initially be unable to view any BOM revisions for a specific part. To correct this, toggle the "No" to "Yes" (for view and edit access) or "View" (for view only access) for the appropriate User Groups and Facilities.
- Business Case - This feature was added to allow certain users to modify / create Items and Formulas specific to their User Restriction (Formulator, Item Planner, Facility) while also allowing them to VIEW only Items and Formulas anywhere else.
Process
Managing BOM Revisions and associated costs
What are the different methods available to add a BOM Revision?
- Using Formula Management or Item Master Management - Items may have several different revisions of a formula with one revision being designated as the default. For example, there might be different revisions based on the equipment used to produce the product or different revisions based on different type of items or ingredients.
- Using the BOM Mass Replace/Delete function - The BOM Mass Replace/Delete transaction allows a user to mass replace or delete items on bill of material lists, giving the user the ability to assign substitute parts on a large scale, or delete discontinued items. A user can modify the BOM of all items to provide a replacement item without editing each and every item. Users may also choose to remove an item from all BOMs in one action.
- Note: This function does not replace or delete items for bill of material revisons that are contained in existing production jobs.
Using the BOM Line import function
DEACOM offers the ability to import BOM lines directly into formulas via the "Import Excel" button on the Edit Bill of Materials form. A total of eight BOM fields and an unlimited number of BOM line user fields may be imported via the use of a spreadsheet. The eight BOM fields, in the order which they should be set on the spreadsheet are: pr_codenum, bo_quant, un_name, bo_overage, bo_scrap, bo_desig, bo_notes, and bo_bgid.
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Note: The first three fields, pr_codenum, bo_quant and un_name are required. The rest, including BOM line user fields, are optional. It is also recommended to use bo_bgid to assign a BOM group to each line for greater organization. An example of a properly formatted spreadsheet is shown below. Note also that the spreadsheet should not include any hidden columns or blank lines.
Note: When importing user fields, values for character or memo user fields should have the cell format of "Text" in the Excel sheet, logical user fields should use the cell format of "TRUE/FALSE" or "Yes/No," and values for date user fields should use a cell format of "Date."
How are BOMs costed?
The process by which DEACOM obtains and calculates the costs that comprise an item's current total cost is represented by the graphic below. Note that in some cases, users may have multiple options when determining how individual costs are entered in the system or if these costs will be rolled up to the item master record.
Rolling up BOMs by using the Mass Pricing Changes function changes an item's current costs, but not the standard costs. The standard costs should only update when a user clicks the "Update Acct Std." button or use the Inventory > Update Inventory costing function. In addition, the current materials amount on an item will update automatically if its BOM is saved, or if the current total on one of its components is changed. If using the Mass Pricing Changes function to roll up your BOM costs the system will recalculate the costs on each BOM and put that amount into the Current materials field. More information, including calculations used to determine the items pictures above, is available in Managing Inventory Costs.
Using additional configuration options
What are some other attributes belonging to BOM Revisions?
- Overissuing on a BOM - The Overissue amount is a percentage that will be added to the "required" and "to issue" amount when issuing material to jobs, but not be relieved when backflushing the BOM of the finished item. This option can be used together with scrap factors as the "required" and "to issue" amount will include both the scrap factor amount and the over-issue% amount. During job finish, the quantity backflushed will only include the scrap factor, leaving the over-issue amount in WIP to be handled manually. Any amount left in WIP will be relieved during job close. If not issuing, then the over-issue% will have no effect.
- Propagating Lot Numbers and Attributions - The "Propagate User Lot" and "Propagate Lot Attributes" flags on the "Edit BOM Line" form allows users to specify that lot numbers and attributes from the bulk materials used on BOM revisions be carried over to carry over to the finished good(s) when finishing production.
- Issue Increment/Increment Expression - Option to set incremental issuing for this BOM item. This field is controlled by the "Issue Inc Type" field on the Edit BOM Line form. Users have two options: Fixed (default) and Expression. The Expression choice allows for the issue increment to be based on variable factors. If the increment is not set to zero, the system will replace the quantity in the "To Issue" column with this increment when issuing to Jobs in the Main and WMS applications. These fields are also available on the Custom BOM line form
- Using Overage and Degradation Factors - Overage and degradation factors are typically setup in the pharmaceutical industry to specify additional raw materials that must be put into a batch to compensate for degradation during manufacture or a product's shelf life. The FDA recommends that any overage or degradation factor be justified considering the safety and efficacy of the product. In most cases, pharmaceutical companies will use overage factors to account for the breakdown or degradation of ingredients. DEACOM provides the ability to input the overage quantity and select the calculation method used on each line of the bill of materials. The default calculation method is defined in the system options.
- Configuring Batch Yields - A Batch Yield, as defined on a Part's Edit BOM form, determines the total quantity of the formula that will be produced as a result of the formula. In DEACOM, users may choose between two different options for how the system will calculate batch yields on BOM revisions:
- Calculated - indicates the system will automatically determine the batch yield either in weight or volume amounts based on the weight, volume, and quantity information for all parts on the bill of material.
- Specified - indicates the yield will be manually entered by the user and needs to be the sum of the quantity on all bill of material lines.
- Requiring QC Tests To Continue Issuing - Companies can require that QC Tests be performed before users may continue issuing items on BOM Lines after the BOM Line requiring the test. The feature is controlled by the "QC To Continue" field on the Edit BOM Line form.
Reporting on BOM Revisions
- To view historical BOM Revisions, navigate to Inventory > Formula Management. Enter any pre-filter information and view. Highlight the current BOM revision, and click the More button in the toolbar, then select Record History. Previously save versions of the BOM will be displayed. Click View Detail to see the BOM as it was at the time of the save.
- The BOM Explosion Summary report via Inventory > Inventory Management will take a Item and break out its BOM into the smallest line. Then will show all the inventory for each item for that BOM as onhand. This can be run wide open or for a specific part to see how much inventory they have.
- The BOM Explosion Detail report via Inventory > Inventory Reporting is also available. For each lot included in the pre-filter, the report generates an indented explosion for that part's BOM, generating the quantities of all raw parts that go into that lot. The system performs the following checks and calculations when this report is run: For each included lot, see if there's a BOM for that part using that lot's facility, or no facility. If there is a BOM, run an explosion report for that BOM, multiplied by the lot's balance. For all parts in the report, the system will use the existing BOM explosion routine to break down each part to its lowest possible unit. For parts with multiple BOMs, use the default BOM for the facility in which the inventory resides.
- Business Case - This report was added for cases in which companies manage customer owned inventory and wanted to know balances on this inventory regardless of where it is within the manufacturing process.
- The "Costs" report, via Inventory > Item Master Management, can be used to display the BOM user calcs for an item's default BOM revision. To use this feature, users will need to modify the report grid and add the appropriate BOM user calculations from the list.
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FAQ & Diagnostic Tips
I attempted to generate a list of all formulas via Inventory > Formula Management (no filters were used) but not records were returned. Why?
Be sure that the User Group you (or the user having this issue) belong to has the proper security assigned in System > System Maintenance > Revision Facility Security.
How can you find out what BOMs do not have routings associated with them?
To find active BOMs that don't have routings, run the following query through the query tool (System > Query Tool):
SELECT pr_codenum, re_name FROM dmprod, dmrev WHERE re_prid = pr_id AND re_active = 1 AND re_status = 'c' AND pr_active = 1 AND re_id NOT IN (SELECT r3_reid FROM dmrout3)
Tip: The basetotwgt and basetotvol variables are available to the grid when modifying a Bill of Materials revision and to BOM user calcs. These variables contain the same calculations as the totwgt and totvol variables less overage, scrap, and overissue.
Can I set the system to round up BOM line quantities?
Yes. The Item Master Property tab contains a field entitled, "Roll Up Job Requirements" flag. If checked, the system rounds up the BOM line quantities to the next whole number when this part is used in production. Specifically, the system evaluates each BOM line to see if the quantity needs to be rounded. This field is used in situations where items on a BOM will never be consumed in a fraction. Example - When a BOM is scaled up, it may state that 3.22 empty bags need to be issued to a job, except in reality, users will never issue a fraction of a bag. Rounding to the next whole number would provide the correct number of bags needed for a job in that scenario.
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