How are Bills of Material Used in PP? 
The data stored in bills of material serves as a basis for production planning activities such as:
- A design department (working with CAD) can base its work on bills of material. You can also create a BOM in the R/3 System from your CAD program, via the SAP-CAD interface.
- A material requirements planning (MRP) department explodes bills of material on a certain date to calculate cost-effective order quantities for materials.
- A work scheduling department uses bills of material as a basis for operation planning and production control.
- A production order management department, uses bills of material to plan the provision of materials.
The data stored in bills of material is also used in other activities in a company such as:
- Sales orders
As an aid to data entry. You can also create and maintain a BOM specifically for a sales order (variant configuration).
- Reservation and goods issue
As an aid to data entry
- Product costing
To calculate the costs of materials required for a specific product
This simultaneous use of BOM data in different areas of a company illustrates the advantage of a system based on integrated application components. Links between application components facilitate continuous data exchange between different application areas, giving all users access to the latest data at all times.