Abstract
BOM is the basic information for design and development, production planning, material planning, purchasing, manufacturing to sales and manufacturing costing in product life cycle. If BOM involves complex manufacturing routing function, it will cause a large number of semi-finished products inventory. To simplify the BOM, the manufacturing routing function has to be separated first, then the associated operations is simplified and the load of engineering, production management and manufacturing departments could be lightened with the unnecessary costs eliminated.This research used case study method to analyze the companies meeting business growth with adopting the new management strategies of more careful and strict control on the manufacturing routing. However, this practice made the BOM more complicated and brought about the management dilemma of increased semi-finished products inventory for the manufacturing related departments. Hence, in the pursuit of lean management, the companies chose to simplify BOM by using separation and simplification rules. Based on our case analysis, this method reduced the BOM levels and increased the sales output on each manufacturing order. This method can enhance the operation simplicity and development flexibility when applied appropriately to both information electronics manufacturers and small-size machining processing vendors.Through the structured rule logics of the simplifying BOM process mentioned above, this research offers a standard set of principles of BOM simplification for engineering, production, and manufacturing departments to follow with auditable process to strengthen enterprises’ operational competitiveness and provides a reference model for improvement in the future.