Levels of Detail (LOD) are critical for managing assemblies by specifying which components - and which versions of those components - should be loaded into Inventor. Various amounts of information are needed at different times in the design process, and different users may have need for more or less of that design data.
First, take a look at this relatively detailed assembly of a test press:
This is the "Master LOD" which contains all the components necessary to manufacture. When I make the assembly drawing for this, I'll reference this LOD with the Bill of Material and my views.
Imagine using this press in the next level assembly. Does the next level need to see all the fasteners? What about bearings, bushings, hosing, and connector hardware? In fact, Inventor creates LOD automatically that suppress content center components. Each component I load requires incrementally more RAM. Imagine now my top level assembly has dozens of these presses along with 10,000 other components? I don't want my designers waiting to load all the data from all the sub-assemblies' complete LOD, so I create simplified versions, and make this standard practice with all my users. These "Low LOD" have few of the pieces I don't need to see in higher level assemblies:
You can also go further and use Shrink Wrap to create a single part that represents an entire assembly, thus maximizing your simplification:
Also, if I intend to analyze this assembly, I don't want to have to mesh and solve for every single part. I create a "Simulation LOD" which neglects the components which are not of interest in my current analysis:
When creating an assembly, take the time to create a Simple LOD for the next assembly. Suppress anything that won't be needed for higher-level constraints/mates, depiction on 2D drawings, or visualization/simulation. Think of who will consume your assembly and make LOD for your audience. For my factory layout I don't need to see the nuances of hydraulic fittings and 1/4" nuts: