Every engineer-to-order (ETO) manufacturer has been here before.
Final assembly is underway. A technician pulls the print, lines up the components, and then stops. Something doesn’t match. A quick investigation reveals the shop floor has been building from Revision B, but engineering released Revision D three weeks ago. The correct parts are on a truck somewhere. The wrong parts are already installed. The customer’s delivery date is next Thursday.
This scenario destroys margins, strains supplier relationships, and erodes customer confidence one project at a time.
More often than not, the chaos traces back to the Bill of Materials (BOM).
The Scale of the Problem
BOM management failures are more than minor administrative inconveniences. According to OpenBOM and industry supply chain research, approximately 70% of a product’s components are outsourced or purchased. This makes the BOM the single most important document connecting engineering to procurement and production. When that document is unreliable, the consequences ripple through the entire organization, resulting in excess inventory, over-ordering, duplicate purchasing, and production delays that compound daily.
The financial exposure is substantial. PMI research indicates that between 50% and 55% of projects experience scope creep with a financial impact. For ETO companies, engineering change orders are a primary contributor to cost overruns. Further research highlights that uncontrolled scope expansion, when changes are added without corresponding updates to budget or timeline, is a preventable cause of project failure and results in an average cost overrun of 27%.
Material waste from bad BOM data and poor inventory controls alone can account for 3–10% of total material costs. In ETO, where BOMs constantly shift, errors get more expensive the longer they go unnoticed. The 1–10–100 rule makes it clear: what costs $1 to fix in design can balloon to $10 in production and $100 after delivery. This escalation can turn small BOM misalignments into major operational and financial hits.
Why ETO BOMs Are Uniquely Difficult
Standard manufacturers lock down a BOM before production begins. Engineer-to-order manufacturers don’t have that luxury. In this environment, engineering improves designs during fabrication. Customers request modifications mid-production. Suppliers discontinue components, requiring last-minute substitutions. Field issues on prior projects trigger immediate specification updates.
As such, the BOM is a living document that morphs because change is built into the business model. Problems arise when those changes travel, or fail to travel, through the organization. In ETO companies without a unified system, information moves in fragments:
- Engineering works in CAD and PDM with the latest revision
- Production prints drawings from last week’s release folder
- Purchasing orders parts from an email attachment that may or may not reflect current specs
- The shop floor builds from whatever print is taped to the workstation
The outcome is a predictable pattern where no one is aligned, and costly rework is all but guaranteed. This can be avoided with a single, authoritative source of truth for the current BOM.
How Novobi’s ETO Blueprint Solves This
Odoo is an open-source ERP built around the premise that every core business function should operate from a single, connected system. Unlike legacy manufacturing software designed for high-volume, standardized production, Odoo’s modular architecture is flexible enough to handle the variability and complexity that define ETO operations.
As an Odoo Gold-level partner with numerous ETO implementations for manufacturing, Novobi leverages the platform through its ETO Blueprint: an integration approach purpose-built to bring BOM control and revision governance to engineer-to-order operations.
Formalized Engineering Change Orders
The foundation of the Blueprint is Odoo’s PLM and manufacturing integration, which brings every BOM or routing modification through a structured Engineering Change Order (ECO) process. Each ECO documents what changed, why it changed, who approved it, and when it takes effect.
There is no ambiguity about which revision is current, as the system enforces it.
A Controlled Release Process
The ETO Blueprint establishes a controlled release process that keeps immature or unapproved designs off the shop floor entirely. Engineering works on draft BOMs in Odoo until a design is ready for production; at that point, a formal release gate opens, and only then are Manufacturing Orders generated. The result is a shop floor that always builds from the current, approved revision, not whatever print happened to be closest at hand.
Automatic Change Propagation
When an ECO is approved, the system doesn’t simply update a file and wait for people to notice. In the ETO Blueprint, Novobi customizes the automatic propagation of changes to open Manufacturing Orders when those changes affect work already in progress. Change orders can flow to open Purchase Orders (PO) if component updates affect what’s been ordered, and to project cost and timeline records if the change carries commercial implications.
Procurement sees engineering changes in real time and not days later when a supplier calls to confirm a conflicting order.
Complete Audit Trail
Every revision, approval, and change carries a full history: what changed, when, who authorized it, and what downstream actions it triggered. For manufacturers operating in regulated industries, this traceability is often a compliance requirement.
Real-World Business Impact
The value of this approach is measurable. Wrong-revision builds, which typically number two to four incidents per quarter for a manufacturer without rigorous BOM control, can be eliminated to zero. Engineering change cycle times that previously ran weeks due to manual coordination and approval bottlenecks are compressed to days through automated workflows. Premium freight costs incurred to rush correct components after discovering a mismatch drop when changes are caught before wrong parts ship. And perhaps most importantly, manufacturers improve their supplier relationships through accurate and stable POs.
Novobi’s work with Inline Cleaning Systems (ICS), an Indiana-based ETO manufacturer, illustrates what this looks like in practice. Before implementing Odoo using Novobi, ICS operated on a 20-year-old legacy system with no integration between its CAD software and manufacturing operations. Every change required manual recalculation of material costs, manual inventory updates, and manual coordination across teams working from disconnected systems.
As ICS’s president described it, the company was “hesitant” to pursue large, complex project quotes because it lacked confidence in its cost data. After implementation, material costs updated automatically with every design change, historical design data informed new project quotes directly, and the company approached large bids with confidence for the first time.
To learn more about how the Novobi ETO Blueprint can bring BOM management to your operation, request a consultation.
DISCLAIMER: The information in this article reflects the views and opinions of Novobi, based on publicly available information, and is intended for informational purposes only. It is not legal or financial advice. All trademarks are the property of their respective owners.
