Key Concepts
As shown in this slide, to establish a product definition, you must first establish product lines, then assign items to them. Although each item needs to have an associated product line to capture inventory costs and movement, each item may or may not have a bill of material (BOM) or routing associated with it. This chapter discusses bills of material; routings are presented later in the course.
• Bills of material specify how much of each component item are required to produce a parent item.
• Routings quantify where and how the product is made, the steps in the process of putting the materials together.
In very common terms, this is like a recipe. Most recipes have a list of ingredients (the bill of material) and a list of steps telling you how to combine the ingredients and how to process them (the routing).
The next few pages describe each step in the process flow shown in the figure above, beginning with product lines, followed by items and bills of material (product structures). Routings are discussed in the chapter on setting up a manufacturing environment.
