Mastering the Item Master

A well-managed item master is a good indication of the maturity and structure of a well-run organization. This guide provides some information and tips to understanding, developing, and maintaining a reliable item master.

What is an Item Master?

An item master is a comprehensive list of all the things you manage during the design and manufacture of your product. Depending on the organization, industry, and decisions made by management, this list is stored, organized, and curated differently.

An item master may include items such as:

  • Material items kept in inventory used in your products like resistors, capacitors, screws, batteries.
  • Non-material items such as NRE fees, shipping costs, labor costs, and test procedure documentation.
  • Abstract representations of data such as firmware and source code references.
  • Capital assets such as test equipment for inventory tracking, calibration records, and depreciation.

PLM and MRP systems both revolve around the concept of an item master. They allow you to easily track, organize, and update everything that has to do with physical products. A good system will offer easy access to the item master and provide detailed information about each item as it pertains to your operations. A poorly-implemented system will increase burden more than benefit and discourage involvement.

Role of the Item Master

All business record keeping revolves around the concept of an item master in one way or another, even if you don’t know it yet!. Even small startups typically have an accounting system like Quickbooks or Xero that operates its own item master. Indeed, every entry on the balance sheet is an item from this master.

Many common business records work from an item master, including:

  • Assemblies & BOMs
  • Vendor Interactions – material and non-material items on quotes & POs
  • Inventory, safety-stock levels
  • Costs of goods sold
  • Sales to customers
  • Accounting

Despite the name, it may be the case that an organization has multiple item masters. For example, if accounting is done in Xero and BOMs are managed in a separate PLM system, these item masters eventually intersect and need to be reconciled. Management of one of more item masters is an important part of business operations and the efficiency of this directly impacts the overall productivity of the business.

Let’s explore some of the key roles of an item master.

Single Source of Truth

A PLM system is typically facilitated by some type of database. This database is a single source of truth (SSoT) for all manufacturing, engineering, and ongoing operations. Electrical engineers, mechanical engineers, engineering project managers, and operations personnel can use it to coordinate in a cohesive and timely manner. Consequently, no matter what position you’re in, you’ll always have a common understanding of your product’s lifecycle.

In cloud-based PLM systems, SSoT is easy to maintain. On paper, or even in multi-site electronic systems, PLM must manage synchronization carefully and accurately in order to assure that everyone knows where the source data lives.

Pro Tip: Single Source of Truth Matters

While the concept of a single source of truth may sound valid and reasonable, it’s easy to overlook common scenarios where segmentation may cause headaches. Furthermore, with today’s complicated IT infrastructures, it’s even easier to see how segmentation can creep in insidiously.

In a database, when SSoT is carefully enforced, we often call the database “normalized”. Data is not duplicated, but rather referenced-to the source material. If you use spreadsheets to manage multiple BOMs, then each spreadsheet has source material for the items on that BOM. If there are parts shared among multiple BOMs, then one spreadsheet may duplicate (often inaccurately) some of the information contained on another spreadsheet. Over time, synchronizing these multiple sources becomes expensive and confidence in the data deteriorates. The longer this situation exists, the more technical and operational debt incurs.

Provide Relevant Information

Manufacturers provide every type of parameter about their products in the product datasheet and other documentation materials. Your engineering organization does not have time to organize every parameter, nor do you care about most of them! An item master tailored to your organization helps filter out what’s unimportant. That way when you go to find a part, you’ll have all the relevant information at your fingertips.

Pro Tip: Carefully Select Your Part Parameters

It can be tempting to add a lot of additional parameters to your items. These can help you filter, search, and organize your item master. However, with each additional parameter you increase the burden of maintenance and data entry.

Careful attention to which parameters provide the most benefit will help you keep your database lean and efficient. One approach is to choose parameters that provide the most value as search terms or filter criteria for the individuals accessing the item master. Additional information that is unlikely to be search criteria can always be made available as file or note attachments.

Operational Intelligence

A good product lifecycle management tool doesn’t just organize a BOM. You can use it to efficiently determine the cost of goods sold and inventory costs associated with those goods. It becomes an ultimate source of business intelligence. As a result, you know where your profitability stands at any moment. No more out-of-date spreadsheets. No more guesswork.

Pro Tip: Establish Policies to Maintain a Clean Item Master

Policies for data and decision reuse can help you maintain tidiness in your Item Master. By establishing a policy of intelligent re-use, you can encourage engineers to choose parts that are broadly stocked and available from multiple sources. This can help guide future part selection decisions and simplify reporting. With policies and conventions in place, you can help assure that past decisions and selections have already been made from an informed position. This saves the effort of a fresh selection process.

Workflow Management

Lastly, an item master facilitates execution of every day processes without excess work or surprises. From what is typically a painful experience, getting quotes turns into a delightful one. Purchases become just another entry in your database. Alarming shortages are a thing of the past. BOM changes are now straightforward. Production assets can be organized and associated with assemblies. Your manufacturing partners never have to wonder what data to use.

Embracing a Managed Item Master – Best Practices

Early on, there can be an urge to lean on someone else’s item master (for example, Digi-Key or Octopart) rather than creating and maintaining your own. We encourage you to resist this urge. These item masters are limited in scope and not applicable to all businesses. Your own assemblies, obviously, will not be part of these databases unless you’re one of their linecard suppliers. This means you have to maintain something of your own anyway.

These item masters are also not part of your organizational context. They don’t tell the story and history of your use of the items. They don’t link to your change history, BOMs, revisions, quotes, purchase history, and so on. They are an excellent dictionary reference, but your item master is a rich encyclopedia.

Enforce Consistency

Use of a relational database as the datastore goes a long way to maintain consistency across your item master. A well-designed database schema is normalized so that most things operate from the single source of truth. However, the application of the item master should also be considered when striving for consistency. For example:

  • Consider how datasheets, notes, workflows, and other assets are attached to items.
  • Establish templates for change requests and change orders.
  • For items of your own manufacture, some part number naming guidelines are helpful.

Establish a Process

Establish a process for introducing new items into the item master. This process should specify who is permitted to create new items in the item master and what steps must be taken to approve and release those items. For example, you may want to make sure that some supplier quote information is available, datasheets are attached, etc. This process does not need to be complex or burdensome. Something consistent with the size and scope of your organization is still helpful.

Pro Tip: The Form / Fit / Function Rule

There are well-established industry guidelines for deciding when to introduce a new SKU (item) into your item master versus revisioning an existing item. These are collectively known as the “form / fit / function rule” and you can learn more about it in our guide: Form / Fit / Function Rule.

Use a Checklist

Many organizations find it helpful to assign one or two item master librarians to help manage and enforce consistency within the item master. These individuals are responsible for approving new additions to the item master and making any broad changes that may affect the integrity of the data. It can be helpful to create a short checklist to make sure that important data is included whenever a new item is released. These checklists can also reduce technical debt incurred by adopting incomplete items into BOMs.

Reduce Effort

Your item master should encourage use, re-use, and maintenance. Introduce only important parameters and item attributes. Let datasheets and other reference materials contain the rest. Additional data creates a burden on item master librarian(s) to research, enter, and maintain accuracy.

PLM and MRP – Two Worlds, One Item Master

Traditionally, PLM and MRP have been maintained as separate, but related universes. PLM mostly handled the abstract: representations of items managed through schematics, BOMs, and revision control. MRP operated in the “real world” with purchasing, accounting, and inventory. A costly shim layer is often used to bridge these worlds resulting in a gap between engineering activities and operational activities.

Aligni presents a unified view of these two worlds. In some cases, creating challenges for engineers accustomed to comfortably operating within the abstract world with less regard for operational realities. Through proper application design and workflows, these two worlds may be integrated efficiently, eliminating the need for expensive and shim layer and the ambiguities it introduces.