Practical Techniques for Holistically Taking Over Existing New Product Programs.
Part 5: Identify “Hot” BOM Items, Prioritize, and Execute (steps 6 & 7).
- Part 1: Right mindset & the foundational rules (Steps 1&2)
- Part 2: Program requirements and status (Step 3)
- Part 3: Manual BOM, Bill of Materials (Step 4)
- Part 4: BOM conversion to materials tracker (Step 5)
- Part 5: Priorities and execution (Steps 6&7)
- Part 6: Combo BOM Trackers (Step 8)
This is a continuation of my blog posts on this subject. Please proceed to Part 1 to read the full article from the start.
Step 6 – Identify “Hot” BOM Items and Assign Priority Numbers.
Timing: Complete in 1-2 days with the readily available information on your first cut. Thereafter, review daily for any changes or additions to the BOM Tracker.
The next step is to review and mark each BOM item that has some level of urgency pending actions by the current responsible party or person. I suggest adding another column or using color shading. Assign a priority number or color scheme. For numbers, highest priority would start with “1”. For colors, highest priority would start with the color red. You can then sort or filter the BOM Tracker by priority. (Note: if you sort, make sure that you have an “Order” or “Reference Nbr” column to keep the original indented BOM order).
This step is important because, in the next step, you will prioritize your daily tasks based on urgency. Look for the following categories.
Critical Path Items
In Project Management terms, the “critical path” is the longest sequence of activities in a project schedule from start to finish. Is the BOM item part of the critical path in the project schedule? If so, any delay before, during, or after the part’s procurement will cause the overall schedule to become late. If the item is needed earlier rather than later, then you should flag the part as urgent along with whatever is the current pending action.
The Program Manager can identify the critical path for you on the schedule. But if you have access to it, you can also find it yourself. In MS Project, the command path is View – Filter – Critical. For any given component, note which assemblies it falls under (per the indented BOM) and find those assembly part numbers or descriptions on the project schedule. Also, in the previous step, you may have already linked the relevant project need dates of those assemblies to your BOM Tracker.
Complex fabricated parts usually comprise the materials portion of a typical project schedule’s critical path. But sometimes you will be surprised to see particular BOM items that are part of the critical path and, therefore, requiring more urgent action than you thought. This could be items like hardware (screws or nuts), a simple machined part, or an electronic component with unexpected super long lead time.
Long Lead Items
Actions for items with long lead time obviously must be given priority, especially if they are part of the critical path. As part of your BOM Tracker creation, therefore, you should determine lead times (estimated or quoted) on all known items ASAP. Until lead time is known, an item should be treated with high priority each day.
Risk Items
These will be BOM items that have some built-in or external risk. Ask yourself if a part has a medium to high risk that, if it happens, could cause late delivery, increased cost, supplier sourcing unavailability, functional failure, difficult manufacturability, or quality nonconformance. If so, mark the item for higher priority and risk mitigation.
Here are just some examples of items that you could identify as risky in some way.
- A large, machined item with intricate and irregular features and very tight tolerances.
- Castings or molded items that are individually as big as a golf cart and weigh a ton each.
- An item that will be machined out of rare or extremely hard raw metal.
- An item from a sole supplier that has a reputation for always shipping late.
- An item for which two suppliers so far have stated that certain features are not manufacturable.
- An item with a design much more complex than the comparable design used during the cost estimating phase, therefore causing a probable budget overrun.
- COTS items that are manufactured in a country or part of the U.S. that recently suffered a massive natural disaster.
Time-Critical Items
These are BOM items that will have deadlines attached to them from internal or external sources. I’m mainly referring to parts that have to be purchased by certain dates because of MRP action messages, purchasing requisitions, or departmental procedures. Some items may be needed ASAP for activities that are not part of the critical path. Some BOM items may need some kind of outside service in order to continue their work order operations. Administratively, there may be issues that have to be cleared up reasonably soon (like an invoice payment dispute or MRB document nonconformance).
Headline News Items
These are items that have been “in the news” lately. That is, they have come up in meetings or emails with some issue that requires daily attention until resolved. Or it might be a part that has visibility, for some reason, up to the executive management or even customer level. Or it might be a BOM item on which Engineering has been heavily concentrating due to conceptual or design issues. It could also be an item that requires intensive collaboration with a key supplier. You will have no choice but to give these items high priority (daily or weekly) because other stakeholders are involved.
Awaiting Response Items
These are items that you want to keep in the spotlight as high priority. They represent any task that you’ve initiated but are awaiting a response in order to complete the task. Some examples include:
- Supplier confirmation that a purchase order is received and accepted.
- Documents from a supplier in order to clear an MRB nonconformance on an order.
- A red line drawing from a Design Engineer for RFQ purposes.
- Quotes from suppliers.
- Budget information on a BOM part from the Program Manager or Cost Estimating.
- Management written approval of a purchase order over a certain dollar value.
- Tracking information on an order just shipped from an overseas supplier.
- Status on a job or order with the supplier.
Purchase Order Progress Items
The bread-and-butter activity of any Buyer, these are items for which purchase order was submitted and supplier monitoring is needed to ensure progress. Depending on the nature of the work or part, the item would be prioritized daily, weekly, or monthly. The actual task would be proactive and cover P.O. status checks via email, phone, teleconference, or visitation.
Step 7 – Prioritize, Execute, Monitor, Status
Timing: Complete daily.
This is the final step in which you take all that you’ve learned and make things happen. Every day, you would take the following actions in the order that works best for you.
- Review. Review the BOM Tracker activities from the previous day and for current status.
- Prioritize. Sort or filter the BOM Tracker to show what part numbers/items you should focus on during the day in order of priority. Specifically, you will be prioritizing actions associated with those items.
- Execute. Do the actual purchasing work. Of course, this includes work not associated with the BOM Tracker such as high priority or recurring administrative tasks per management or the company leadership.
- Monitor. Once purchase orders are placed, it’s important to not ignore them and hope for the best on timely delivery. Checking purchase order status, for example, should always be done regularly.
- Update. Update the BOM Tracker with changes or additions, including revised priority numbers or colors.
- Reflect. At the end of the day, ask yourself if you were able to make significant progress. If not, what were the limiting factors or obstacles? Do you need help or the ability to delegate lower priority tasks?
Part 6 of this blog will cover the benefits and management of combination BOM Trackers (step 8).
To be continued. Stay tuned for Part 6!
NPI Supply Chain Craft 
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