A bill of materials (BOM) is an extensive list of 

raw materials, components, and

instructions required to construct, manufacture, or repair a product or service. A
bill of materials usually appears in a hierarchical format, with the highest level
displaying the finished product and the bottom level showing individual
components and materials.

A bill of materials (BOM) is a centralized source of information used to

manufacture a product. It is a list of the items needed to create a product as well
as the instructions on how to assemble that product. Manufacturers that build
products start the assembly process by creating a BOM.

Creating an accurate bill of materials (BOM) is vital because it ensures that parts
are available when needed as well as ensuring that the assembly process is as
efficient as possible. If the BOM is not accurate, it can cause production to halt,
which increases operating costs, as time is needed to locate missing parts, start
another production order, or until the correct process of assembly is determined.

The different types of bills of materials (BOMs) depend on the type of project and
the business needs. Common areas that utilize BOMs are engineering, design,
operations, manufacturing, and more. A manufacturing BOM is essential in
designing enterprise resource planning (ERP) systems and materials
requirement planning (MRP).

Items included in a BOM are the part number, part name, quantity, unit of
measurement, assembly references, method of parts construction, and additional
notes.
Waste can be defined as any production activity that utilizes
resources but does not add any value for the customer.  Since
these wastes add to the cost of products, they either reduce the
profit the manufacturer makes or inflate the price that the
customer needs to pay. In general, customers are not willing to
pay for these activities because they do not benefit from
them. When speaking about waste, lean experts usually refer to
seven specifically. These include: transportation, inventory,
motion, waiting, over processing, overproduction, and defects. 

Transportation – Transport/Transportation is moving materials from one position to another. The

transport itself adds no value to the product, so minimizing these costs is essential. This means
having one plant closer to another in the production chain, or minimizing the costs of
transportation using more efficient methods. Resources and time are used in handling material,
employing staff to operate transportation, training, implement safety precautions, and using
extra space. Transport can also cause the waste of waiting, as one part of the production chain
must wait for material to arrive. Environmental costs to waiting include gas emissions,
transportation packaging used, possible damage to the product en route, as well as a whole
host of other wastes involving transporting hazardous materials.

Inventory- Inventory waste refers to the waste produced by unprocessed

inventory. This includes the waste of storage, the waste of capital tied up in
unprocessed inventory, the waste of transporting the inventory, the containers used to
hold inventory, the lighting of the storage space, etc. Moreover, having excess inventory
can hide the original wastes of producing said inventory.

The environmental impacts of inventory waste are packaging, deterioration or damage

to work-in-process, additional materials to replace damaged or obsolete inventory, and
the energy to light—as well as either heat or cool—inventory space.

Motion- Wasteful motion is all of the motion, whether by a person or a

machine, that could be minimized. If excess motion is used to add value that could have
been added by less, than that margin of motion is wasted. Motion could refer to
anything from a worker bending over to pick something up on the factory floor to
additional wear and tear on machines, resulting in capital depreciation that must be
replaced.

There are many environmental costs from excess motion. One obvious one is the
needless waste of materials used to replace worn machines; another one could be the
health resources for overburdened employees, who might not have needed them if
motion had been minimized.

Waiting- Waiting refers to wasted time because of slowed or halted

production in one step of the production chain while a previous step is completed. To
take the classic example, the production line, if one task along the chain takes longer
than another, than any time the employee in charge of the next task spends waiting is
wasted. The task that takes more time must be made more efficient, other employees
must be hired to help, or the workflow must be better coordinated or scheduled in order
to make up for this wasted time.

The environmental impact comes from the wasted labor and energy from lighting,
heating, or cooling during the waiting period. Additionally, material can be spoiled, and
components could be damaged because of an inefficient workflow.

Over-processing- Over-processing refers to any component of

the process of manufacture that is unnecessary. Painting an area that will never be
seen or adding features that will not be used are examples of over-processing.
Essentially, it refers to adding more value than the customer requires.

The environmental impact involves the excess of parts, labor, and raw materials
consumed in production. Time, energy, and emissions are wasted when they are used
to produce something that is unnecessary in a product; simplification and efficiency
reduce these wastes and benefit the company and the environment.

Overproduction- The most serious of the wastes, overproduction

can cause all other types of wastes and results in excess inventory. Stocking too much
of a product that goes unused has obvious costs: storage, wasted materials, and
excessive capital tied up in useless inventory.

Depending, of course, on the product in question, overproduction can have very serious
environmental effects. More raw materials than necessary are consumed; the product
may spoil or become obsolete, which requires that it be tossed; and, if the product
involves hazardous materials, more hazardous materials than necessary are wasted,
resulting in extra emissions, extra costs of waste disposal, possible worker exposure,
and potential environmental problems resulting from the waste itself.
Defects- Defects refer to a product deviating from the standards of its design
or from the customer’s expectation. Defective products must be replaced; they require
paperwork and human labor to process it; they might potentially lose customers; the
resources put into the defective product are wasted because the product is not used.
Moreover, a defective product implies waste at other levels that may have led to the
defect to begin with; making a more efficient production system reduces defects and
increases the resources needed to address them in the first place.

Environmental costs of defects are the raw materials consumed, the defective parts of
the product requiring disposal or recycling (which wastes other resources involved in
repurposing it), and the extra space required and increased energy use involved in
dealing with the defects.

Waiting line management is common in the service industry. It involves treating the customers in
order to reduce their waiting time and to improve the quality of service provided to them. Through
an efficient waiting line management, an organization can increase its profit by lowering its cost
because when a customer waits in line, there is a cost involved in it.

Many scenarios can be seen when people wait in line for a particular service, such as customers
waiting in line in a bank to withdraw or deposit cash, customers waiting at a ration shop, vehicles
in a line at a petrol pump and so on.

There are implications of waiting for lines which shows why waiting lines are a cause for concern.
They are given as below:

1.Losing Customers- The most obvious effect of waiting in long lines

is the loss of customers. Since customers are the lifeline of any business, it is
important that they are satisfied (and thus retained) as much as possible.
Although it is a detriment to a business to lose a customer due to long lines, this
becomes a much bigger problem when the customer leaves and chooses to do
business with a competitor. The loss of customers to competitors is one of the
primary reasons that businesses must be sure to address the issue of long lines in
their establishments.

2.Less Efficient- With long lines unfortunately becoming a staple in

some industries such as retail (especially during the holidays), these businesses
 have experienced a less productive work environment. As with most businesses or
organizations, one of their primary objectives is to make sure that they are
working at an optimal rate and achieving total quality management, also known
as TQM.

3.Bad Reputation- In the marketing world, there is an expression that

says that the best way to advertise something is by word of mouth. This means
that a product or service is advertised through direct testimonies by people who
have actually used the product or service. Word of mouth is very useful because
people know that they can trust the words of a customer as opposed to an
organization or company spokesperson trying to sell the public on a product. As a
stark contrast, a bad reputation can be earned if the word of mouth is negative.

A business that has long lines runs the ultimate risk of having a bad reputation in the
community. Have you ever been told of an incident that may have occurred at a restaurant that
caused you to not want to visit the establishment again? If so, whether this news was confirmed
or not, the negative connotation gave the restaurant a bad reputation in your mind and the
minds of others who heard the story. Unfortunately, perception is reality in the eyes of the
consumer, so the long lines of businesses run the risk of damaging their reputations.

1. It involves the cost of providing waiting space.

2. There will be a possible loss of business if the customer refuses to enter the line or leaves the
line before getting served.

3. Congestion created by it may cause disruption to other operations of the business and other
customers.

4. There will be a possible loss of goodwill

5. Also, there will be a possible reduction in the satisfaction of consumers.

Aggregate planning is the process of developing,
analyzing, and maintaining a preliminary, approximate
schedule of the overall operations of an organization.
The aggregate plan generally contains targeted sales
forecasts, production levels, inventory levels, and
customer backlogs. This schedule is intended to
satisfy the demand forecast at a minimum cost.

In simple terms, aggregate planning is an attempt to

balance capacity and demand in such a way that costs
are minimized. The term "aggregate" is used because
planning at this level includes all resources "in the
aggregate;" for example, as a product line or family.

Aggregate planning is considered to be intermediate-

term (as opposed to long- or short-term) in nature.
Hence, most aggregate plans cover a period of three
to 18 months. Aggregate plans serve as a foundation
for future short-range type planning, such as
production scheduling, sequencing, and loading. The
master production schedule (MPS) used in material
requirements planning (MRP) has been described as
the aggregate plan "disaggregated."

Steps taken to produce an aggregate plan begin with

the determination of demand and the determination of
current capacity. Capacity is expressed as total
number of units per time period that can be produced
(this requires that an average number of units be
computed since the total may include a product mix
utilizing distinctly different production times). Demand
is expressed as total number of units needed. If the
two are not in balance (equal), the firm must decide
whether to increase or decrease capacity to meet
demand or increase or decrease demand to meet
capacity. In order to accomplish this, a number of
options are available.

The planning sequence in aggregate planning are the

following:

1. Business Plan- Establishes operations and

capacity strategies
2. Aggregate plan- Establishes operations capacity

3. Master schedule- Establishes schedules for

specific products
4.

corporate strategies and policies, economic,

competitive and political conditions