Introduction
Printed circuit board (PCB) design is a balancing act between cost, performance, and quality. With pressures to reduce PCB costs without compromising on other design goals, engineering teams are looking for creative ways to optimize designs. One valuable methodology is conducting detailed bill of materials (BOM) cost analysis at each design phase. This provides data-driven insights into the cost structure and savings opportunities. This article will examine how BOM cost analysis can reveal impactful PCB design changes just over the horizon that reduce cost while upholding functionality.
The Value of Regular BOM Cost Analysis
BOM cost analysis involves separating the PCB assembly BOM into logical cost buckets and monitoring the breakdown over time. Common BOM categories include:
- Active components - ICs, transistors, diodes
- Passive components - resistors, capacitors, inductors
- Electromechanical - connectors, switches, sensors
- PCB fabrication cost
- Misc. hardware - brackets, fasteners, standoffs
Comparing the distribution of BOM costs at concept, schematic, and layout phases highlights areas of cost increase or decrease. By supplementing this normalized view with absolute cost data, insights for targeted cost reduction emerge.
Regular BOM cost analysis acts as a guidepost for engineers, providing visibility into component costs that often get buried in detailed design work. Maintaining cost awareness encourages proactive, not just reactive, cost optimization.
BOM Analysis Process
Effective BOM cost analysis involves the following key steps:
1. Extract Baseline Cost Data
- Gather current BOM information from CAD tools, simulation results, supplier inputs etc.
- Add estimated costs for each component from procurement and suppliers.
- Include actual or projected PCB fabrication + assembly costs.
2. Categorize Costs
- Divide BOM data into standard component categories such as actives, passives, electromechanical, PCB cost, other hardware etc.
- Add any new categories needed to provide sufficient granularity.
3. Calculate Percentage Breakdown
- Sum costs for each BOM category.
- Divide category costs by total BOM cost to calculate category percentage of total.
4. Visualize Trends
- Plot category cost percentages over time to visualize increase/decrease trends.
- Combine with tables showing absolute costs for deeper insights.
5. Identify Focus Areas
- Analyze trends to pinpoint components contributing disproportionate costs.
- Prioritize categories/components with biggest cost increase for corrective action.
6. Define Cost Reduction Plans
- Research lower cost component substitutes, sourcing changes, design tweaks etc. for high priority BOM items.
- Estimate potential savings and risk tradeoffs for each plan.
7. Track Cost Impacts
- Update analysis as design progresses to validate if focus area costs were reduced as expected.
- Continue iterations until target PCB cost is achieved.
BOM Analysis in Action
Here is an example BOM cost analysis during the design process for an IoT sensor product:
Concept Phase
| Category | Est. Cost | % of Total |
|---|---|---|
| Microcontroller | $2 | 20% |
| Sensors | $1.50 | 15% |
| Power Management | $1 | 10% |
| Passives | $0.50 | 5% |
| Connectors | $1 | 10% |
| PCB | $2 | 20% |
| Enclosure | $2 | 20% |
| Total | $10 | 100% |
- Analysis shows an even distribution of costs, but connectors and enclosure stand out as high.
Schematic Design
| Category | Est. Cost | % of Total |
|---|---|---|
| Microcontroller | $2 | 15% |
| Sensors | $2 | 15% |
| Power Management | $1 | 10% |
| Passives | $1 | 10% |
| Connectors | $2 | 15% |
| PCB | $3 | 20% |
| Enclosure | $2 | 15% |
| Total | $13 | 100% |
- Additional sensors increased that cost. PCB estimate also rose. Overall BOM increased by $3.
PCB Layout
| Category | Est. Cost | % of Total |
|---|---|---|
| Microcontroller | $2 | 10% |
| Sensors | $2 | 10% |
| Power Management | $1 | 5% |
| Passives | $2 | 15% |
| Connectors | $1.50 | 10% |
| PCB | $2.50 | 15% |
| Enclosure | $2 | 10% |
| Misc. Hardware | $2 | 15% |
| Total | $15 | 100% |
- Component optimization and enclosure redesign lowered connector cost. But passives and hardware rose.
This simplified example demonstrates how regular cost breakdown analysis provides visibility to guide cost reduction decisions in PCB design.
BOM Analysis Enables Targeted Cost Plans
Detailed, phased BOM analysis highlights problem areas to create targeted cost reduction plans:
Example 1: High PCB Cost
- Root Cause: Layer count increased to accommodate complex routing. Via densities grew.
- Cost Plan: Simplify layout for fewer layers. Reduce via counts through optimization.
- Impact: Cut PCB cost 15% with moderate schedule delay.
Example 2: Rising Passive Costs
- Root Cause: Unexpected need for more decoupling capacitors driven by power integrity analysis.
- Cost Plan: Redesign power distribution for fewer caps. Substitute smaller case size devices.
- Impact: Reduce passive cost 20% with minimal impact on performance.
Example 3: Gold-Plated Connectors
- Root Cause: Design specified expensive gold-plated connectors due to misguided reliability concerns.
- Cost Plan: Replace with tin-plated connectors that meet technical needs.
- Impact: Cut connector costs 50% with no adverse effect.
These examples demonstrate how BOM analysis guides engineering towards impactful savings that may otherwise be overlooked.
Organizational Considerations
Certain organizational enablers help maximize the value of regular BOM cost analysis:
- Cross-functional analysis team - Representation from engineering, procurement, finance provides broad perspectives.
- Baseline cost targets - Early cost goals guide analysis. Targets set too late reduce opportunities.
- Design-to-cost culture - Organization must value cost optimization, not just technical elegance.
- Accessible cost data - Component cost information must be easily available to engineers.
- Design tool integration - Linking analysis outputs to CAD and simulation tools aids exploration of alternatives.
- Vendor collaboration - Supplier input helps identify savings opportunities.
Overcoming Analysis Challenges
Companies face some common challenges when implementing BOM cost analysis:
- Difficulty estimating custom component costs
- Insufficient data access and transparency
- Component prices fluctuating mid-analysis
- Extra upfront effort to maintain rigorous analysis
- Lack of organizational urgency regarding cost reduction
- Analysis results not translating into definitive action plans
However, these roadblocks can be overcome through tactics such as:
- Sourcing price ranges even for custom parts
- Automating data collection from enterprise systems
- Adding cost margin cushions to estimates
- Making analysis activity a formal design review deliverable
- Securing executive sponsorship of cost initiatives
- Empowering engineers to make cost optimization changes
Expert Cost Analysis Perspectives
Industry experts provide these tips for getting maximum benefit from BOM cost analysis:
- "Perform analysis early at the concept stage and update it throughout the design process."
- "Work jointly with procurement teams who bring pricing expertise to component selection."
- "Use dashboards and graphs to make cost data stand out versus just compiling spreadsheets."
- "Tie analysis activities into larger NPI cost management initiatives and gate reviews."
- "Let analytics illuminate the cost drivers, but keep the human factor front and center when making tradeoffs."
- "Think three moves ahead when considering cost reduction changes - evaluate total lifecycle impact."
Conclusion
Regular BOM cost analysis, when made an integral part of the design process, provides crucial visibility that enables engineers to optimize PCB designs for cost efficiency. By revealing component cost trends and focusing attention on savings opportunities, BOM analysis gives teams data-driven guardrails to guide cost reduction decisions without compromising quality or performance. This disciplined approach ultimately leads to PCB designs that meet target cost goals through tangible, achievable changes just over the horizon.
Frequently Asked Questions
Q: How often should BOM cost analysis be conducted during a new PCB design project?
A: Ideally at each major design phase - concept, schematic, layout - as well additional ad hoc analyses to support tradeoff decisions.
Q: What level of granularity in BOM breakdown provides the most useful cost insights?
A: 5-10 major categories provides a good level detail without becoming overly fragmented. Drill down further on specific areas of concern.
Q: Who should participate on the core analysis team?
A: Representation from engineering, procurement/sourcing, cost accounting, design partners. Executive sponsorship.
Q: What are some potential risks of overly relying on BOM cost analysis?
A: Can lead to sub-optimal tradeoffs by focusing too much on upfront cost instead of total lifecycle cost and value.
Q: How can BOM analysis be implemented with minimal disruption to design schedules?
A: Automate data collection, keep reporting formats standard/repeatable, make activity a defined output of existing reviews.
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