4000 - 5421 Flashcards
(1421 cards)
1
Q
quality circle
A
A small group of people who normally work as a unit and meet frequently to uncover and solve problems concerning the quality of items produced, process capability, or process control. Syn.: quality control circle. See: small-group improvement activity.
2
Q
quality control
A
The process of measuring quality conformance by comparing the actual with a standard for the characteristic and taking corrective actions on the difference. See: quality assurance/control.
3
Q
quality control circle
A
Syn.: quality circle.
4
Q
quality costs
A
The overall costs associated with prevention activities and the improvement of quality throughout the firm before, during, and after production of a product. These costs fall into four recognized categories: internal failure costs, external failure costs, appraisal costs, and prevention costs. Internal failure costs relate to problems before the product reaches the customer. These usually include rework, scrap, downgrades, reinspection, retest, and process losses. External failure costs relate to problems found after the product reaches the customer. These usually include such costs as warranty and returns. Appraisal costs are associated with the formal evaluation and audit of quality in the firm. Typical costs include inspection, quality audits, testing, calibration, and checking time. Prevention costs are those caused by improvement activities that focus on reducing failure and appraisal costs. Typical costs include education, quality training, and supplier certification. See: cost of poor quality.
5
Q
quality engineering
A
The engineering discipline concerned with improving the quality of products and processes.
6
Q
quality function deployment (QFD)
A
A methodology designed to ensure that all the major requirements of the customer are identified and subsequently met or exceeded through the resulting product design process and the design and operation of the supporting production management system. QFD can be viewed as a set of communication and translation tools. QFD tries to eliminate the gap between what the customer wants in a new product and what the product is capable of delivering. QFD often leads to a clear identification of the major requirements of the customers. These expectations are referred to as the voice of the customer. See: house of quality (HOQ).
7
Q
quality loss function
A
A parabolic approximation of the quality loss that occurs when a quality characteristic deviates from its target value. The quality loss function is expressed in monetary units: The cost of deviating from the target increases quadratically as the quality characteristic moves farther from the target. The formula used to compute the quality loss function depends on the type of quality characteristic being used. The quality loss function was first introduced in this form by Genichi Taguchi.
8
Q
quality policy
A
A top-management statement of the overall quality direction of an organization as required by ISO 9001.
9
Q
quality score chart
A
Syn.: Q chart.
10
Q
quality tree
A
An analytical tool that visualizes quality being composed of four layers of achievement: (1) inspection, (2) process measurement and improvement, (3) process control, and (4) design for quality.
11
Q
quality trilogy
A
A three-pronged approach to managing quality proposed by Joseph Juran. The three legs are quality planning (developing the products and processes required to meet customer needs), quality control (meeting product and process goals), and quality improvement (achieving unprecedented levels of performance). Syn.: Juran Trilogy.
12
Q
quality, cost, delivery (QCD)
A
Key measurements of customer satisfaction. Kaizen activity strives to improve these measurements.
13
Q
quantitative forecasting techniques
A
An approach to forecasting in which historical demand data is used to project future demand. Extrinsic and intrinsic techniques are typically used. See: extrinsic forecasting method, intrinsic forecast method.
14
Q
quantity discount
A
A price reduction allowance determined by the quantity or value of a purchase. See: discount, price break.
15
Q
quantity discount model
A
A variation of the economic order quantity model in which the assumption of a single price is relaxed and there is a schedule of prices based on specific volumes. Syn.: price-break model.
16
Q
quantity per
A
The quantity of a component to be used in the production of its parent. This value is stored in the bill of material and is used to calculate the gross requirements for components during the explosion process of material requirements planning.
17
Q
quantity-based order system
A
Syn.: fixed reorder quantity inventory model.
18
Q
quarantine
A
The setting aside of items from availability for use or sale until all required quality tests have been performed and conformance certified.
19
Q
quasi manufacturing
A
A type of service operation that closely resembles a manufacturing process. The focus is on the production process, technology, costs, and quality.
20
Q
question mark
A
In marketing, a slang term for a low-market- share but high-growth-rate product. See: growth-share matrix.
21
Q
queue
A
A waiting line. In manufacturing, this refers to the jobs at a given work center waiting to be processed. As queues increase, so do average queue time and work-in-process inventory.
22
Q
queue discipline
A
A parameter in queuing theory that determines the order in which customers are to be served.
23
Q
queue length
A
The quantity of items in a queue that are awaiting service.
24
Q
queue management
A
Tactics to deal with an excess number of items, such as products or customers, waiting in line for service.
25
queue ratio
The ratio of the hours of slack within the job to the queue originally scheduled.
26
queue time
The amount of time a job waits at a work center before setup or work is performed on the job. Queue time is one element of total manufacturing lead time. Increases in queue time result in direct increases to manufacturing lead time and work-in-process inventories.
27
queuing analysis
The study of waiting lines. See: queuing theory.
28
queuing theory
The collection of models dealing with waiting line problems, such as products or customers arriving at a service facility at which waiting lines or queues may build. Syn.: waiting line theory. See: queuing analysis.
29
quick asset ratio
A measure of a firm’s financial stability. It is calculated by subtracting inventory from current assets and then dividing that amount by current liabilities. A value greater than 1 is desirable. Syns.: quick ratio, acid test, acid test ratio.
30
quick changeover
The ability to shorten machine setups between different machine operation requirements to increase process flexibility. The first priority is reducing external setup time, and the second is internal setup issues. Quick changeover reduces economic order quantity, queue and manufacturing lead times, and work-in-process inventory. It also improves quality, process, and material flows.
31
quick ratio
Syn.: quick asset ratio.
32
quick-response (QR) Code
A two-dimensional bar code capable of storing product information that can be used for a wide variety of activities, such as inventory management, tracking and tracing goods, differentiating authentic items from counterfeit products, and verifying warranties.
33
quick-response manufacturing (QRM)
A company-wide strategy to cut lead times in all phases of manufacturing and office operations. With its roots in the time-based competition strategies, quick-response manufacturing focuses on the relentless pursuit of lead time reduction. While using manufacturing resources planning for higher-level planning, quick-response manufacturing often uses a replenishment technique called paired-cell overlapping loops of cards, which combines the best of push and pull strategies. See: paired-cell overlapping loops of cards with authorization (POLCA).
34
quick-response program (QRP)
A system of linking final retail sales with production and shipping schedules back through the chain of supply. This system employs point-of-sale scanning and electronic data interchange and may use direct shipment from a factory to a retailer.
35
quotation
A statement of price, terms of sale, and a description of goods or services offered by a supplier to a prospective purchaser. This can also be known as a bid. When given in response to an inquiry, it is usually considered an offer to sell. See: bid.
36
quotation expiration date
The date on which a quoted price is no longer valid.
37
R chart
A control chart in which the subgroup range, R, is used to evaluate the stability of the variability within a process. Syn.: range chart.
38
R&D
Abbreviation for research and development.
39
R&D order
Syn.: experimental order. RACI (responsible, accountable, consulted, and informed)
40
analysis
An acronym used to describe a document that identifies who is responsible, who is accountable, who should be consulted, and who should be kept informed for various aspects of a project or process.
41
rack
A storage device for handling material in pallets. A rack usually provides storage for pallets arranged in vertical sections with one or more pallets to a tier. Some racks accommodate more than one-pallet-deep storage.
42
racking
A function performed by a rack-jobber—a full-function intermediary who performs all regular warehousing functions and some retail functions, typically stocking a display rack.
43
radio frequency identification (RFID)
A system used to store data about items through the use of electronic tags and electromagnetic transmitters. RFID systems can be used to locate items or track material as it moves and do not require close proximity or line-of-sight access.
44
rail gauge
The spacing of the width of the rails on a railway track, measured between the inner sides of the rails. In rail transport, this is a key parameter in determining interoperability because all vehicles must have running gear that is compatible with the spacing. However, this spacing can vary among countries and cause compatibility issues.
45
rail waybill
A freight document that indicates that goods have been received for shipment by rail. The shipper receives a copy as a receipt for acceptance.
46
railcar capacity
The amount of cargo that fits in a railcar.
47
RAM
Acronym for responsibility assignment matrix.
48
ramp rate
The speed at which a company expands or grows. Syn.: growth trajectory.
49
random access
A manner of storing records in a computer file so that an individual record may be accessed without reading other records.
50
random cause
Syn.: common causes.
51
random sample
A selection of observations taken from all the observations of a phenomenon in such a way that each chosen observation has the same possibility of selection.
52
random variation
A fluctuation in data that is caused by uncertain or random occurrences. See: random events.
53
random-location storage
A storage technique in which parts are placed in any space that is empty when they arrive at the storeroom. Although this random method requires the use of a locator file to identify part locations, it often requires less storage space than a fixed-location storage method. Syns.: floating inventory location system, floating storage location. See: fixed-location storage.
54
range
In statistics, the spread in a series of observations. For example, the anticipated demand for a particular product might vary from a low of 10 items to a high of 500 items per week. The
55
range would therefore be 500
10 or 490.
56
range chart
Syn.: R chart.
57
rapid prototyping
1) The transformation of product designs into physical prototypes. Rapid prototyping relies on techniques such as cross-functional teams, data sharing, and advanced computer and communication technology (e.g., CAD, CAM, stereolithography, and data links). Rapid prototyping involves producing the prototype on production equipment as often as possible. It improves product development times and allows for cheaper and faster product testing, assessment of the ease of assembly and costs, and validation before actual production tooling. 2) The transformation of system designs into computer system prototypes with which the users can experiment to determine the adequacy of the design to address their needs. See: 3D printing.
58
rapid replenishment
A replenishment strategy in which the supplier prepares shipments at predetermined intervals and varies the quantity based on recent sales data. Sales data may be supplied via a point-of-sale system. See: continuous replenishment.
59
rate basis point
The center of shipping in a specific area. It is used to determine shipping rates.
60
random component
A component of demand usually describing the impact of uncontrollable variation on demand. See: decomposition, time series analysis.
61
rate of return on investment
The efficiency ratio relating profit or cash flow incomes to investments. Several different measures of this ratio are in common use.
62
random events
1) Occurrences that have no discernable pattern. 2) In statistics, unexplained movements occurring in historical (time series) data. See: random variation.
63
random numbers
A sequence of integers or a group of numbers (often in the form of a table) whose members show absolutely no relationship to each other anywhere in the sequence. At any point, all values have an equal chance of occurring, and they occur in an unpredictable fashion.
64
rate variance
The difference between the actual output rate of product and the planned or standard output rate.
65
rate-based scheduling
A method for scheduling and producing based on a periodic rate (e.g., daily, weekly, or monthly). This method has traditionally been applied to high-volume and process industries. The concept has also been applied within job shops using cellular layouts and mixed-model level schedules when the production rate is matched to the selling rate.
66
rated capacity
The expected output capability of a resource or system. Capacity is traditionally calculated from such data as planned hours, efficiency, and utilization. The rated capacity is equal to hours available × efficiency × utilization. Syns.: calculated capacity, effective capacity, nominal capacity, standing capacity.
67
ratification
The situation wherein a principal that has failed to denounce an agent’s unauthorized conduct is consequently bound by the conduct.
68
rationalization exercise
A process of reducing the population of figures such as stock keeping unit counts or supplier lists.
69
rationing
The allocation of product among consumers. When price is used to allocate product, it is allocated to those willing to pay the most.
70
raw material
Purchased items or extracted materials that are converted via the manufacturing process into components and products.
71
raw material quality improvement
An analysis of the potential value that could be gained from raw material inventory reduction. It requires analysis or simulation of the current impact of raw material quality and opportunities for reducing inventory while improving quality.
72
raw materials inventory
Inventory of material that has not undergone processing at a facility.
73
raw materials receiving process
A standard procedure to efficiently receive and process raw materials from suppliers to minimize the amount of time to receive raw materials. The process could include advanced ship notices, receiving inspections, bar code label scanning, use of master pack labels, use of shrink wrap, and efficient receiving and stocking procedures.
74
RCCP
Abbreviation for rough-cut capacity planning.
75
reach
The percentage of target customers who receive an advertising message.
76
reactive maintenance
Syn.: breakdown maintenance.
77
reactor
A special vessel to contain a chemical reaction.
78
real property
Land and associated rights improvements, utility systems, buildings, and other structures.
79
real time
The technique of coordinating data processing with external related physical events as they occur, thereby permitting prompt reporting of conditions. See: online service.
80
real-time package tracking
The use of technology like a radio frequency identification tag or a machine-to-machine antenna to track the movement and location of packages in real time.
81
reasonable rate
A pricing strategy that allows a company to profit but not to achieve monopolistic profits. This is normally determined by industry pricing analysis.
82
recalls
A step in the reverse logistics process when parts or products are requested to be returned because of a product defect or potential hazard resulting from government regulations or liability concerns.
83
receipt
1) The physical acceptance of an item into a stocking location. 2) The transaction reporting of this activity.
84
receivables conversion period
The length of time required to collect sales receipts. Syn.: average collection period.
85
receiving
The function encompassing the physical receipt of material, the inspection of the shipment for conformance with the purchase order (quantity and damage), the identification of and delivery to the destination within the receiving organization, and the preparation of receiving reports.
86
receiving goods inspection
The practice of inspecting goods upon receipt for any delivery discrepancies such as damage, incorrect quantity compared with purchase order or delivery paperwork, and incomplete or incorrect paperwork.
87
receiving point
The location to which material is being shipped. Ant.: shipping point.
88
receiving report
A document used by the receiving function of a company to inform others of the receipt of goods purchased.
89
recency, frequency, monetary (RFM)
Giving the highest rating to customers who have bought recently, bought many times, and bought in large amounts.
90
reconciling inventory
Comparing the physical inventory figures with the perpetual inventory record and making any necessary corrections.
91
reconsignment
Permission by a carrier to alter the destination and/or consignee while in transit or after the shipment has reached its original destination.
92
record
1) A collection of data fields arranged in a predefined format. 2) A set of related data that a computer program treats as a unit.
93
record accuracy
A measure of the conformity of recorded values in a bookkeeping system to the actual values. An example of this is the on-hand balance of an item maintained in a computer record relative to the actual on-hand balance of the items in the stockroom.
94
recovery
A reverse logistics strategy for the activities involved in the collection of used and discarded products, components, and materials. It focuses on reuse, repair, refurbishment, remanufacturing, recycling, or disposal. The objective is to recover as much of the economic value as possible, reduce waste, and minimize environmental impacts.
95
recovery time
In periods of insufficient capacity, jobs back up indefinitely. This leads to increased lead times and missed due dates. Recovery time is a period of time when capacity exceeds demand to allow the system to empty out. If there is not enough recovery time before the next episode of insufficient capacity, in-process inventory and lead times continue to grow.
96
registration to standards
A process in which an accredited, independent third-party organization conducts an on-site audit of a company’s operations against the requirements of the standard to which the company wants to be registered. Upon successful completion of the audit, the company receives a certificate indicating that it has met the standard requirements.
97
recycle
1) The reintroduction of partially processed product or carrier solvents from one operation or task into a previous operation. 2) A recirculation process.
98
red bead experiment
An experiment developed by W. Edwards Deming to illustrate the impossibility of putting employees in rank order of performance. The experiment shows that it would be a waste of management’s time to try to find out why one worker produced more errors than another. Management should instead improve the system, making it possible for everyone to achieve higher quality.
99
red zone
The lowest-level buffer zone in drum-buffer-rope scheduling where the red color is used to indicate a serious situation for the buffer.
100
redundancy
1) A backup capability, coming either from extra machines or from extra components within a machine, to reduce the effects of breakdowns. 2) The use of one or more extra or duplicating components in a system or equipment (often to increase reliability).
101
redundant component
A backup part of a machine or product.
102
reefer vessel
Syn.: refrigerator car.
103
reference capacity model
A simulation model with accurate operational details and demand forecasts that can provide practical capacity utilization predictions. Various alternatives for system operation can be evaluated effectively.
104
refrigerator car
A temperature-controlled boxcar used to transport perishable goods. Syn.: reefer vessel.
105
refurbished goods
Syn.: remanufactured parts.
106
refurbished parts
Syn.: remanufactured parts.
107
regen
Slang abbreviation for regeneration material requirements planning. Pronounced “ree-jen.”
108
regeneration MRP
A material requirements planning (MRP) processing approach in which, to maintain valid priorities, the master production schedule is totally re-exploded down through all bills of material. New requirements and planned orders are completely recalculated or regenerated at that time. Ant.: net change MRP.
109
regional air carriers
Air transport services that run between less populated areas and major cities in the United States. These companies have annual revenues less than $100 million.
110
regression analysis
A statistical technique for determining the best mathematical expression describing the functional relationship between or among one response and one or more independent variables. See: least-squares method.
111
regularized schedule
A schedule having certain items produced at regular intervals.
112
rejected inventory
Inventory that does not meet quality requirements but has not yet been sent to rework, scrapped, or returned to a supplier.
113
rejection
The act of identifying an item as not meeting quality specifications.
114
relational database
A software program that allows users to obtain information drawn from two or more databases that are made up of two-dimensional arrays of data.
115
relationship map
A graphic map of the relationship between the business functions. It shows the inputs and outputs flows across functions. It is useful to show process flows, disconnections in processes, and proposed processes. Relationship maps show the products and services of a given unit, how work flows through organizational boundaries, and the relationships between functions represented by boxes in the map.
116
relationship marketing
A form of target marketing in which the type and time of communications are determined by the customer. Syn.: permission marketing.
117
release
The authorization to produce or ship material that has already been ordered.
118
released order
Syn.: open order.
119
release-to-start manufacturing
The time it takes from when an order is released until the beginning of the manufacturing process. This delay occurs because of the movement of materials and the changing of lines. It is non-productive time that increases lead time.
120
relevant costs
Those costs incurred because of a decision. The costs would not have resulted unless the decision was made and implemented. They are therefore relevant to the decision.
121
relevant range
The range of activity planned for a firm.
122
reliability
1) The probability that a product will perform its specified function under prescribed conditions without failure for a specified period of time. 2) A design parameter that can be made part of a requirements statement. 3) A Supply Chain Operations Reference (SCOR) performance attribute. The reliability attribute addresses the ability to perform tasks as required. Reliability focuses on the predictability of the outcome of a process. Typical metrics for the reliability attribute include on time, the right quantity, and the right quality. Reliability is a customer-focused attribute. See: mean time between failures (MTBF), mean time to failure (MTTF).
123
reliability engineering
The function responsible for the determination and application of appropriate reliability tasks and criteria during the design, development, manufacture, test, and support of a product that will result in achievement of the specified product reliability.
124
remanufactured parts
Components or assemblies that are refurbished or rebuilt to perform the original function. Syns.: refurbished goods, refurbished parts.
125
remanufacturing
1) An industrial process in which worn-out products are restored to like-new condition. In contrast, a repaired product normally retains its identity, and only those parts that have failed or are badly worn are replaced or serviced. 2) The manufacturing environment where worn-out products are restored to like-new condition.
126
remanufacturing resource planning
A manufacturing resource planning system designed for remanufacturing facilities.
127
remedial maintenance
Unscheduled maintenance performed to return a product or process to a specified performance level after a failure or malfunction.
128
remote diagnostics
The capability of determining the cause of a problem from an off-site location.
129
remote return authorization
The practice of allowing the customer or retailer to assess the state of returned materials or products to determine if they can be reused. If an item cannot be reused, the customer or retailer can dispose of it and eliminate the costs of shipping and handling items that will ultimately be discarded.
130
reneging
A queuing theory term for leaving a line after entering it but before receiving service. See: balking.
131
renewable energy
Energy that is collected from natural resources that are continually replenished, such as sunlight and wind. These are sometimes referred to as renewables.
132
reorder cycle
Syn.: replenishment lead time.
133
reorder point (ROP)
Syn.: order point.
134
reorder quantity
1) In a fixed reorder quantity system of inventory control, the fixed quantity that should be ordered each time the available stock (on-hand plus on-order) falls to or below the reorder point. 2) In a variable reorder quantity system, the amount ordered from time period to time period varies. Syn.: replenishment order quantity.
135
repair bill of material
In remanufacturing, the bill of material defining the actual work required to return a product to service. The process to return a product to service is based on inspection and determination of actual requirements. See: disassembly bill of material.
136
repair factor
The percentage of time on average that an item must be repaired for return to a serviceable condition. The repair factor is also expressed as a percentage applied to the quantity per assembly on the bill of material. It is useful for forecasting materials and capacity requirements for planning purposes. Syn.: frequency of repair. See: occurrence factor, replacement factor.
137
repair order
Syn.: rework order.
138
repair parts
Syn.: service parts.
139
repair parts demand
Syn.: service parts demand.
140
repairables
Items that are technically feasible to repair economically.
141
repeatability of measurement
The variation in measurements obtained when one measurement instrument is used several times by an appraiser while measuring the identical characteristic on the same part.
142
repetitive industries
The group of manufacturers that produce high-volume, low-variety products such as spark plugs, lawn mowers, and paper clips. See: repetitive manufacturing.
143
repetitive manufacturing
The repeated production of the same discrete products or families of products. Repetitive methodology minimizes setups, inventory, and manufacturing lead times by using production lines, assembly lines, or cells. Work orders are no longer necessary; production scheduling and control are based on production rates. Products may be standard or assembled from modules. Repetitiveness is not a function of speed or volume. Syns.: repetitive process, repetitive production. See: project manufacturing.
144
repetitive process
Syn.: repetitive manufacturing.
145
repetitive production
Syn.: repetitive manufacturing.
146
replacement cost
A method of setting the value of inventories based upon the cost of the next purchase.
147
replacement cost systems
A method of inventory valuation that assigns an item cost based on the next item price incurred.
148
replacement factor
The percentage of time on average that an item will require replacement. The replacement factor is also expressed as a percentage applied to the quantity per assembly on the bill of material. It is useful for forecasting materials and capacity requirements for planning purposes. See: occurrence factor, repair factor.
149
replacement order
An order for the replacement of material that has been scrapped.
150
replacement parts
Parts that can be used as substitutes but differ from completely interchangeable service parts in that they require some physical modification (e.g., boring, cutting, or drilling) before they can replace the original part.
151
replan cycle
The time it takes to implement a new production plan into the plant’s actual production plan. The replan cycle occurs after completion of the last cycle and takes the form of a rolling document.
152
replanning frequency
In a material requirements planning (MRP) system, the amount of time between successive runs of the MRP model. If the planner does not run MRP frequently enough, the material plan becomes inaccurate because material requirements and inventory status change with the passage of time.
153
replenishment
Relocating material from a bulk storage area to an order pick storage area and documenting this relocation.
154
replenishment interval
Syn.: replenishment period.
155
replenishment lead time
The total period of time that elapses from the moment it is determined that a product should be reordered until the product is back on the shelf available for use. Syn.: reorder cycle.
156
replenishment order quantity
Syn.: reorder quantity.
157
replenishment period
The time between successive replenishment orders. Syn.: replenishment interval. See: review period.
158
reprocessed material
Goods that have gone through selective rework or recycle.
159
reproducibility
A production program’s ability to regularly produce products of the correct quantity and quality.
160
repurpose
To take something and use it for something else not originally intended. The materials may be repaired, reconditioned, and repackaged for resale or used in a different manner through remanufacturing, recycling, or salvage.
161
request for information (RFI)
An inquiry to a potential supplier about that supplier’s product or service for potential use in the business. The inquiry can provide certain business requirements or be of a more general exploratory nature. See: request for proposal (RFP).
162
request for proposal (RFP)
A document used to solicit vendor responses when the functional requirements and features are known but no specific product is in mind. Syn.: invitation for bid (IFB). See: request for information (RFI).
163
request for quote (RFQ)
A document used to solicit vendor responses when a product has been selected and price quotations are needed from several vendors.
164
required capacity
Syn.: capacity required.
165
requirements definitions
Specifying the inputs, files, processing, and outputs for a new system but without expressing computer alternatives and technical details.
166
requirements explosion
The process of calculating the demand for the components of a parent item by multiplying the parent item requirements by the component usage quantity specified in the bill of material. Syn.: explosion.
167
requirements traceability
The capability to determine the source of demand requirements through record linkages. It is used in analyzing requirements to make adjustments to plans for material or capacity. See: pegging.
168
requisition
Syn.: parts requisition.
169
rerouting flexibility
Accommodating unavailability of equipment by quickly and easily using alternate machines in the processing sequence.
170
rescheduling
The process of changing order or operation due dates, usually as a result of their being out of phase with production or customer commitments.
171
rescheduling assumption
A fundamental assumption of material requirements planning logic that existing open orders can be rescheduled in nearer time periods far more easily than new orders can be released and received. As a result, planned order receipts are not created until all scheduled receipts have been applied to cover gross requirements.
172
rescheduling notice
A message from planning system software to change the planned start and/or finish date of an order. This often is the result of a change in plans of a parent item. See: nervousness.
173
research and development (R&D)
A function that performs basic and applied research and develops potential new products.
174
resellers
Organizations intermediate in the manufacturing and distribution process, such as wholesalers and retailers, that purchase goods or services with the intention of selling them rather than consuming or using them.
175
reservation
The process of designating stock for a specific order or schedule. See: allocation.
176
reserve
Contingency funds set aside to mitigate risk.
177
reserve stock
Syn.: safety stock.
178
reserved material
Material on hand or on order that is assigned to specific future production or customer orders. Syns.: allocated material, assigned material, obligated material.
179
residence time
Syn.: process time.
180
residual income
The net operating income that an investment center earns above the minimum required return on its operating assets.
181
residual inventory
Inventory created by the canceling or rescheduling of an order or left over because of lot sizing.
182
resilience
In the supply chain, the ability to return to a position of equilibrium after experiencing an event that causes operational results to deviate from expectations. Resilience can be improved by increasing the number of response options and/ or decreasing the time to execute those options. Resilience is improved by risk monitoring and control.
183
resilient supply chain benchmark
A benchmark used by publicly-traded U.S. companies in consumer electronics, retail, and pharmaceutical industries to assess supply chain resilience. The framework uses 31 indicators to determine operational and strategic supply chain resilience.
184
resource
Anything that adds value to a good or service in its creation, production, or delivery.
185
resource breakdown structure
A hierarchical structure that breaks resources into categories and types. This structure can be useful for plan resource schedules, including human resources.
186
resource calendar
A calendar of working days and nonworking days that shows when resources are idle. Typically, the calendar includes holidays and weekends. See: manufacturing calendar.
187
resource contention
Simultaneous need for a common resource. Syn.: concurrency.
188
resource driver
The objects that are linked to an activity that consumes resources at a specified rate. For example, a resource driver is a purchase order (the object) that when placed (the activity) consumes hours (the rate) of purchasing (the resource).
189
resource leveling
The process of scheduling (and rescheduling) the start and finish dates of operations (or activities) to achieve a consistent rate of resource usage so that resource requirements do not exceed resource availability for a given time period. Syn.: leveling.
190
resource limited schedule
Project schedule with no early or late start or finish dates. The activity and scheduled start and finish dates show the expected availability of resources. Syn.: resource-constrained schedule.
191
resource management
1) The planning and validation of all organizational resources. 2) The effective identification, planning, scheduling, execution, and control of all organizational resources to produce a good or service that provides customer satisfaction and supports the organization’s competitive edge and ultimately its organizational goals. 3) An emerging field of study emphasizing the systems perspective, encompassing both the product and process life cycles, and focusing on the integration of organizational resources toward the effective realization of organizational goals. Resources include materials; maintenance, repair, and operating supplies; production and supporting equipment; facilities; direct and indirect employees; staff; administrative and professional employees; information; knowledge; and capital. Syn.: integrated resource management (IRM).
192
resource planning
Capacity planning conducted at the business plan level. Resource planning is the process of establishing, measuring, and adjusting limits or levels of long- range capacity. It is normally based on the production plan but may be driven by higher-level plans beyond the time horizon of the production plan (e.g., the business plan). It addresses those resources that take long periods of time to acquire. Resource planning decisions always require top management approval. Syn.: resource requirements planning. See: capacity planning, long-term planning.
193
resource profile
The standard hours of load placed on a resource by time period. Production lead-time data is taken into account to provide time-phased projections of the capacity requirements for individual production facilities. See: bill of resources, capacity planning using overall factors (CPOF), product load profile, rough-cut capacity planning (RCCP).
194
resource requirements planning
Syn.: resource planning.
195
resource-constrained schedule
Syn.: resource limited schedule. See: drum-buffer-rope (DBR).
196
resource-limited scheduling
The scheduling of activities so that predetermined resource availability pools are not exceeded. Activities are started as soon as resources are available (with respect to logical constraints), as required by the activity. When not enough of a resource exists to accommodate all activities scheduled on a given day, a priority decision is made. Project finish may be delayed, if necessary, to alter schedules constrained by resource usage.
197
response time
The elapse of time or average delay between the initiation of a transaction and the results of the transaction.
198
responsibility assignment matrix (RAM)
A tool to ensure that each component of work in a project is assigned to a responsible person.
199
responsible landfill
Landfill operations designed to turn waste into recoverable resources, minimize the amount of space consumed, and maximize the operational life of the landfill.
200
responsible procurement
Ensuring the use of ethical sources of goods and services where a firm does business to bring about a positive impact and minimize the negative impacts on societies and environments. This includes processes for identifying, assessing, and managing the environmental, social, and ethical risks in the supply chain. Another important strategy is reducing, reusing and recycling materials. Syn.: environmentally responsible purchasing.
201
responsive demand-supply matching (RDSM)
The ability to sense demand exceptions; target revenue opportunities; and resolve supply challenges through planning of constrained resources (material, labor, and equipment capacity) and the allocation of supply across the network to best meet demand aligned with the business strategy.
202
responsiveness
Refers to the speed or promptness with which an organization or supply chain provides products and services to the customer. Responsiveness is a Supply Chain Operations Reference (SCOR) performance attribute.
203
restoration of future economic benefit
A term used to define the unit or aggregate value received from not disposing of a return but instead renewing it for future use. See: non-defective defectives.
204
retail method
A method of inventory valuation in which the value is determined by applying a predetermined percentage based on retail markup to the retail price in order to determine its inventory value based on cost.
205
retailer
A business that takes title to products and resells them to final consumers.
206
retainage
A percentage of a contract value that is withheld pending project completion and approval.
207
retention efficiency
In marketing, a measurement of how well a company creates repeat customers.
208
retirement of debt
The termination of a debt obligation by appropriate settlement with the lender. Repayment or forgiveness is understood to be in full amount unless partial settlement is specified.
209
retrofit
An item that replaces components originally installed on equipment. It is a modification to in-service equipment.
210
return
The activities associated with the reverse flow of goods. Detail activities encompass identification of the need to return, disposition decision-making, scheduling of the return, and shipment and receipt of the returned goods.
211
return adaptability
The maximum sustainable percentage increase in returns that can be achieved in 30 days. For Source, this includes raw materials to suppliers. For Deliver, this includes finished goods from customers.
212
return authorization
A document that provides information about why a part or product is being returned that enables the supplying company to plan for the next appropriate action or actions, such as shipping a replacement unit to the customer, scheduling the return unit for warranty repair, scheduling the return unit for a repair not covered by warranty, returning the unit to stock, or returning the unit to the vendor.
213
return authorization required
See: return material authorization (RMA).
214
return cost recovery
The process of recovering part or all of the cost from the vendor when a defect in a returned item is determined to be related to a component purchased from that vendor.
215
return cycle time
The average time associated with return processes, which typically start with the decision to return a product and end with collecting and restocking the product.
216
return disposal costs
The costs that occur from discarding or recycling products that are returned because they have reached the end of their useful lives or are obsolete. These costs are commonplace in the consumer goods industry.
217
return goods handling
The work a company puts into accepting returned goods from its customers.
218
return load optimization
Combining customer deliveries with pickups for returned items to optimize transportation.
219
return material authorization (RMA)
1) A form that must be completed that describes the product returned and why it was returned. 2) A number given to authorize the acceptance of returned items. 3) The signatory authorization that is normally required to return the goods. See: return authorization required.
220
return merchandise authorization
Syn.: return material authorization (RMA).
221
return on assets (ROA)
Net income for the previous 12 months divided by total assets. See: return on owner’s equity (ROE).
222
return on investment (ROI)
A relative measure of financial performance that provides a means for comparing various investments by calculating the profits returned during a specified time period. In theory of constraints, ROI is calculated by subtracting operating expenses from throughput and then dividing that amount by the investment.
223
return on net assets
Profit divided by assets excluding depreciation.
224
return on owner’s equity (ROE)
A financial measurement of how successful a company is in creating income for the owners of the organization. A comparison of the ROE with the return on assets indicates the effectiveness of financial leverage employed by the firm. The measurement is calculated by dividing net income by average owner’s equity. See: return on assets (ROA).
225
return on supply chain fixed assets
A measurement of the return an organization receives from its invested capital in supply chain fixed assets. This includes the fixed assets used in Orchestrate, Plan, Order, Source, Transform, Fulfill, and Return.
226
It is calculated as (Supply Chain Revenue
Total Supply Chain Management Cost) ÷ Supply Chain Fixed Assets.
227
return on working capital
A measure of profit on the amount of capital consumed. It is calculated as after-tax operating income divided by net working capital.
228
returns depositing
The review process for returned goods generally performed at the point of return. The process begins with triage, which is a general practice to inspect the product. Dispositioning options may include: repair and return to user, return to stock — no issue found, repair and refurbish, or send to salvage. Each of these options may involve different service providers and practices.
229
returns inventory costs
All of the costs associated with handling returned inventory.
230
return policy conformance integration
Procedures and technology that ensure conformance to return policies.
231
return policy included with shipping document
The practice of including the return policy with the shipping documentation.
232
return renewal
The options for a returned product that will be transformed and placed back into stock or sent directly to a customer. These options include reuse, recycle, remanufacture, refurbish, upcycle, downcycle, etc., for reverse supply chains, return supply chains, and replenish supply chains.
233
return repair/refurbish
Reviewing a returned item and determining whether it can be repaired, recycled, remanufactured, or disassembled to sell any usable parts.
234
return resell
Providing returned goods to alternate channels for resale into the market. The resale may include refurbished goods, where the secondary channel may be responsible for product support and warranty on refurbished products.
235
return shipment insurance
Financial protection from problems that might occur with high-value excess inventory return shipments.
236
return shipping consolidation
The routing of authorized returns to central hubs or facilities where they can be combined and routed to the correct location in order to eliminate the need for sorting.
237
return to supplier
Material that was rejected by the buyer’s inspection department and is awaiting shipment back to the supplier for repair or replacement.
238
return tracking
Following the path of a return shipment by using the tracking number assigned by the carrier.
239
returns
A step in the reverse logistics process when a customer sends a product back for any of several possible reasons including the product being defective, damaged, out of season, or outdated (end-of-life); because it failed to meet expectations; or because it represented excess inventory.
240
returns allowance
The quantity of product that a customer is allowed to return, usually calculated as a percentage of total purchases. This quantity may be captured in a contract or warranty.
241
returns center--
A facility where an organization's returns are processed. This is also commonly referred to as a centralized return center.
242
returns inventory reduction
A process designed to decrease returns through efficiently receiving, processing, and disposing of returned products.
243
returns management process
A process of handling returns that includes environmentally sound disposal or recycling, composition of repair instructions, warranty repairs, and collection of return data.
244
returns management systems (RMS)
Software systems created specifically to feed the reconciliation processes. These systems include: receiving for unknown goods coming in, processing of returns, tracking of return authorizations, shipping, quality assurance, metrics, and other reporting.
245
returns policy to reduce returns inventory
Evaluating and establishing a standard approach for handling business returns. Topics covered by this policy typically include methods for handling buyer’s remorse, defective items, buyer over- purchasing, and warranty claims.
246
returns processing cost
All of the costs associated with dealing with returned items after they have been received. These costs occur when returned items are repaired, discarded, or replaced.
247
returns receiving refurbishment
The practice of returning defective material to the receiving function for processing. Repairs, modifications, or enhancements are made by the same receiving personnel, rather than sending the materials to personnel who handle the Make process elements. Then, the materials are sent to the shipping function for return to the original recipient.
248
reuse
1) The use of an item for a new purpose (e.g., repurpose) or similar purpose with only minimal reprocessing. Reuse differs from remanufacture as it assumes less repair or reclamation activity to the reused good. 2) Part of the 3 R's of waste management: reduce, reuse, and recycle. These are part of the global effort to reduce waste and minimize consumption of the world's resources.
249
revenue
The income received by a company from sales of products or services. Revenues can come from other sources including stock owned in other companies, income from selling property, or other company assets that are not a typical part of the core business.
250
reverse auction
An internet auction in which suppliers attempt to underbid their competitors. Company identities are known only by the buyer.
251
reverse engineering
The process of disassembling, evaluating, and redesigning a competitor’s product for the purpose of manufacturing a product with similar characteristics without violating any of the competitor’s proprietary manufacturing technologies.
252
reverse flow scheduling
A scheduling procedure used in some process industries for building process train schedules. The scheduling starts with the last stage and proceeds backward (countercurrent to the process flow) through the process structure.
253
reverse logistics
A complete supply chain dedicated to the reverse flow of products and materials for the purpose of returns, repair, remanufacture, and/or recycling.
254
reverse logistics service
A service that arranges for the disposal of returned products.
255
reverse supply chain
The planning and controlling of the processes of moving goods from the point of consumption back to the point of origin for repair, reclamation, recycling, or disposal. See: reverse logistics.
256
review period
The time between successive evaluations of inventory status to determine whether to reorder. See: replenishment period.
257
revision level
A number or letter representing the number of times a part drawing or specification has been changed.
258
rework
Reprocessing to salvage a defective item or part.
259
rework lead time
The time required to rework material in-house or at a supplier’s location.
260
rework order
A manufacturing order to rework and salvage defective parts or products. Syns.: repair order, spoiled work order.
261
RFID
Abbreviation for radio frequency identification.
262
RFM
Acronym for recency, frequency, monetary.
263
RFP
Acronym for request for proposal.
264
RFQ
Acronym for request for quote.
265
right size frequency of production wheel
See: mixed-model production.
266
right the first time
A term used to convey the concept that it is beneficial and more cost-effective to take the necessary steps the first time to ensure that a good or service meets its requirements than to provide a good or service that will need rework or not meet customers’ needs. In other words, an organization should engage in defect prevention rather than defect detection.
267
right-to-work state
A state that allows workers to choose whether or not to join a union.
268
risk acceptance
A decision to take no action to deal with a risk or an inability to format a plan to deal with the risk.
269
risk adjusted discount rate
A discount rate that is higher for more risky projects and lower for less risky projects.
270
risk analysis
A review of the uncertainty associated with the research, development, and production of a product, service, or project.
271
risk appetite
Amount and type of risk that an organization is willing to pursue or retain.
272
risk avoidance
Changing a plan to eliminate a risk or to protect plan objectives from its impact.
273
risk breakdown structure
A tool that helps identify potential project risks, which are organized by risk categories and subcategories.
274
risk category
A cluster of risk causes with a label such as external, environmental, technical, or organizational.
275
risk management
The identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events or to maximize the realization of opportunities.
276
risk management planning
The process of defining how to identify and minimize risk factors for a project.
277
risk mitigation
Reducing exposure to risk in terms of either its likelihood or its impact.
278
risk pooling
A method often associated with the management of inventory risk. Manufacturers and retailers that experience high variability in demand for their products can pool together common inventory components associated with a broad family of products to buffer the overall burden of having to deploy inventory for each discrete product.
279
risk rating
A numerical assessment of the risk associated with a supplier, customer, or product, normalized and used for comparison purposes.
280
risk register
A report that has summary information on qualitative risk analysis, quantitative risk analysis, and risk response planning. This register contains all identified risks and associated details.
281
risk response plan
A document defining known risks including description, cause, likelihood, costs, and proposed responses. It also identifies current status of each risk.
282
risk response planning
The process of developing a plan to avoid risks and to mitigate the effect of those that cannot be avoided.
283
risk tolerance
An organization’s or stakeholder’s readiness to accept a threat or potential negative outcome in order to achieve its objectives.
284
risk transfer
A form of risk management that involves distributing the risk with other parties. The extent to which risk is distributed can depend on the reliability and clarity of the risk-sharing arrangements. Risk could be transferred through insurance or other forms of contract.
285
RMA
Acronym for return material authorization.
286
ROA
Acronym for return on assets.
287
road waybill
A shipping document used to control shipments of goods for road transport. The document travels with the shipment and serves as a receipt for goods and evidence of the contract of carriage.
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road-rail vehicle
A dual-mode vehicle that can operate both on rail tracks and conventional roads.
289
robotic process automation (RPA)
The use of automated robotic equipment or technology to perform standard, repetitive, rule-based tasks in place of human effort in order to improve speed, efficiency, and accuracy.
290
robotics
Replacing activities previously performed by humans with mechanical devices or robots that can either be operated by humans or run by computer. Difficult-to-do, dangerous, or monotonous tasks are likely candidates for robots to perform.
291
robust design
Type of design for a product or service that plans for intended performance even in the face of a harsh environment.
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robustness
The condition of a product or process design that remains relatively stable with a minimum of variation even though factors that influence operations or usage, such as environment and wear, are constantly changing.
293
ROE
Acronym for return on owner’s equity.
294
ROI
Acronym for return on investment.
295
rolling forecast
Moving the forecast horizon forward to new periods by adding recent data (and perhaps dropping the oldest data).
296
rolling wave planning
A form of planning in which the work to be performed in the near term is planned in detail and longer- term work is planned at a lesser level of detail.
297
roll-on/roll-off container ship (RORO)
A ship that allows trailers to be driven on and off without the use of cranes.
298
root cause analysis
Analytical methods to determine the core problem(s) of an organization, process, product, market, and so forth. See: current reality tree (CRT), five whys, stratification analysis.
299
ROP
Abbreviation for reorder point.
300
rope
One of the three devices required for proper management of operations. (The other two are drum and buffer.) The rope is the information flow from the drum to the front of the line (material release), which chokes the release of materials to match the flow through the constraint.
301
RORO
Abbreviation for roll-on/roll-off container ship.
302
rotable part
A broken part that is repaired and then sent to another customer as a replacement as part of a closed loop of repairable products. The person originally returning the broken part also receives a repaired or rotable part.
303
rotable spares pool
An inventory of serviceable parts that can replace a customer’s broken part to help minimize customer downtime.
304
rough-cut capacity planning (RCCP)
The process of converting the master production schedule into requirements for key resources, often including labor; machinery; warehouse space; suppliers’ capabilities; and, in some cases, money. Comparison with available or demonstrated capacity is usually done for each key resource. This comparison assists the master scheduler in establishing a feasible master production schedule. Three approaches to performing RCCP are the bill of labor (resources and capacity) approach, the capacity planning using overall factors approach, and the resource profile approach. See: bill of resources, capacity planning, capacity planning using overall factors (CPOF), product load profile, resource profile.
305
route management system
A software program that helps dispatchers organize their fleets and route trucks to ensure the most efficient travel directions to their destinations.
306
route sheet
Syn.: routing.
307
routing
1) Information detailing the method of manufacture of a particular item. It includes the operations to be performed, their sequence, the various work centers involved, and the standards for setup and run. In some companies, the routing also includes information about tooling, operator skill levels, inspection operations and testing requirements, and so on. Syns.: bill of operations, instruction sheet, manufacturing data sheet, operation chart, operation list, operation sheet, route sheet, routing sheet. See: bill of labor, bill of resources. 2) In information systems, the process of defining the path a message will take from one computer to another computer.
308
routing guide
A shipping tool used to manage logistics activities for shipments between two points. It contains mode and carrier information, freight rates, and service requirements.
309
routing sheet
Syn.: routing.
310
RPA
Acronym for robotic process automation.
311
rules automation
Rules using triggers that initiate the rule, conditions that define the rule, and actions that perform tasks automatically based on preset criteria.
312
run
A quantity of production being processed.
313
run chart
A graphical chart that illustrates how a process is performing over time. By statistically analyzing a run chart, a process can be determined to be under or out of control. The most common types of data used to construct the charts are ranges, averages, percentages and counts, and individual process attributes (e.g., temperature). Syn.: run diagram. See: C chart, P chart, R chart, U chart, X-bar chart.
314
run diagram
Syn.: run chart.
315
run order
Syn.: manufacturing order.
316
run sheet
A log-type document used in continuous processes to record raw materials used, quantity produced, in-process testing results, and so on. It may serve as an input document for inventory records.
317
run size
Syn.: standard batch quantity (SBQ).
318
run standards
Syn.: run time.
319
run time
The time required to process a piece or lot at a specific operation. Run time does not include setup time. Syn.: run standards.
320
running sum of forecast errors
The arithmetic sum of the differences between actual and forecasted demand for the periods being evaluated.
321
run-out list
1) A list of items to be scheduled into production in sequence by the dates at which the present available stock is expected to be exhausted. 2) A statement of ingredients required to use up an available resource (e.g., how much of Y resource is required to consume 300 pounds of X).
322
run-out method
A method of assigning available production or storage capacity to products based on the product’s demand and inventory level.
323
rush order
An order that for some reason must be fulfilled in less than normal lead time.
324
S&OE
Abbreviation for sales and operations execution.
325
S&OP
Abbreviation for sales and operations planning.
326
SA8000
A widely recognized international standard for managing human rights in the workplace. It provides an auditable framework for assuring that social accountability is being stewarded by an organization.
327
SaaS
Abbreviation for software-as-a-service.
328
safety capacity
In theory of constraints, the planned amount by which available capacity exceeds current productive capacity. This capacity provides protection from planned activities (such as resource contention), preventive maintenance, and unplanned activities (such as resource breakdown, poor quality, rework, or lateness). Safety capacity plus productive capacity plus excess capacity equals 100 percent of capacity. Syn.: capacity cushion. See: protective capacity.
329
safety data sheet (SDS)
A document that is part of the materials information system and accompanies the product. It was formerly referred to as the manufacturing safety data sheet. The document is prepared by the manufacturer and provides information regarding the safety and chemical properties to downstream users and, if necessary, regarding the long-term storage, handling, and disposal of the product. Among other factors, the SDS describes: the hazardous components of a product; how to treat leaks, spills, and fires; and how to treat improper human contact with the product.
330
safety factor
1) The ratio of average strength to the worst stress expected. It is essential that the variation, in addition to the average value, be considered in design. 2) The numerical value used in the service function (based on the standard deviation or mean absolute deviation of the forecast) to provide a given level of customer service. For example, if the item’s mean absolute deviation is 100 and a .95 customer service level (with a safety factor of 2.06) is desired, then a safety stock of 206 units should be carried. This safety stock must be adjusted if the forecast interval and item lead times differ. Syn.: service factor. See: service function.
331
safety lead time
An element of time added to normal lead time to protect against fluctuations in lead time so that an order can be completed before its real need date. When used, the material requirements planning system, in offsetting for lead time, will plan both order release and order completion for earlier dates than it would otherwise. Syns.: protection time, safety time.
332
safety stock
1) In general, a quantity of stock planned to be in inventory to protect against fluctuations in demand or supply. 2) In the context of master production scheduling, the additional inventory and capacity planned as protection against forecast errors and short-term changes in the backlog. Overplanning can be used to create safety stock. Syns.: buffer stock, reserve stock. See: hedge, inventory buffer.
333
safety stock planning
The process of identifying the correct amount of inventory that should be held for a given item to guard against a stockout.
334
safety stock reduction
Pursuing a more aggressive reorder point or safety stock target that increases the risk of a stockout. Often this is done to help mitigate the effects of an expected sharp downturn in demand.
335
safety time
Syn.: safety lead time.
336
salable goods
A part or assembly authorized for sale to final customers through the marketing function.
337
sale-and-leaseback
An agreement by which a firm first sells its assets to a financial institution and then leases these same assets from the financial institution.
338
sales and operations execution (S&OE)
A short-term (zero to 3 months) business planning process that connects daily operations to the strategic activities of sales and operations planning (S&OP) (3 to 24 months). This weekly process translates plans from S&OP into daily operations and actions. It includes tactical decision-making through the monitoring of demand and supply, forecast accuracy, production execution, and inventory levels. See: sales and operations planning (S&OP).
339
sales and operations planning (S&OP)
A process to develop tactical plans that provide management the ability to strategically direct its businesses to achieve competitive advantages on a continuous basis by integrating customer- focused marketing plans for new and existing products with the management of the supply chain. The process brings together all the plans for the business (sales, marketing, development, manufacturing, sourcing, and financial) into one integrated set of plans. S&OP is performed at least once a month and is reviewed by management at an aggregate (product family) level. The process must reconcile all supply, demand, and new product plans at both the detail and aggregate levels and connect to the business plan. It is the definitive statement of the company’s plans for the near to intermediate term, covering a horizon sufficient to plan for resources and to support the annual business planning process. Executed properly, the S&OP process links the strategic plans for the business with its execution and reviews performance measurements for continuous improvement. See: aggregate planning, executive sales and operations planning (executive S&OP), production plan, production planning, sales plan, tactical planning.
340
sales cycle time
Time from a product entering a floor until it is completely sold out.
341
sales forecast
Syn.: forecast.
342
sales mix
The proportion of individual product-type sales volumes that make up the total sales volume.
343
sales operations management
The management of activities and processes to ensure that the sales function runs efficiently, is well integrated with other functional areas, and supports the overall business strategy.
344
sales order configuration
Syn.: customer order servicing system.
345
sales order number
A unique control number assigned to each new customer order, usually during order entry. It is often used by order promising, master scheduling, cost accounting, invoicing, and so forth. For some make-to-order products, it can also take the place of an end-item part number by becoming the control number that is scheduled through the finishing operations.
346
sales plan
A time-phased statement of expected customer orders anticipated to be received (incoming sales, not outgoing shipments) for each major product family or item. It represents sales and marketing management’s commitment to take all reasonable steps necessary to achieve this level of actual customer orders. A sales plan is a necessary input to the production planning process (or sales and operations planning process). It is expressed in units identical to those used for the production plan (as well as in sales dollars). See: aggregate planning, production plan, production planning, sales and operations planning (S&OP).
347
sales planning
The process of determining the overall sales plan to best support customer needs and operations capabilities while meeting general business objectives of profitability, productivity, competitive customer lead times, and so on, as expressed in the overall business plan. See: production planning, sales and operations planning (S&OP).
348
sales promotion
1) Sales activities that supplement both personal selling and marketing, coordinate the two, and help to make them effective (e.g., displays). 2) More loosely, the combination of personal selling, advertising, and all supplementary selling activities. 3) Promotion activities—other than advertising, publicity, and personal selling—that stimulate interest, trial, or purchase by final customers or others in the marketing channel.
349
sales quota
The level of sales that an individual or group is expected to meet.
350
sales representative
An employee authorized to accept a customer’s order for a product. Sales representatives usually go to the customer’s location when industrial products are being marketed.
351
salvage
Property that, because of its worn, damaged, deteriorated, or incomplete condition or specialized nature, has no reasonable prospect of sale or use as serviceable property without major repairs or alterations but that has some value in excess of its scrap value.
352
salvage value
1) The cost recovered or that could be recovered from used property when removed, sold, or scrapped. It is a factor in appraisal of property value and in computing depreciation. 2) The market value of a machine or facility at any point in time. Normally, it is an estimate of an asset’s net value at the end of its estimated life.
353
sample
A portion of a universe of data chosen to estimate some characteristics about the whole universe. The universe of data could consist of sizes of customer orders, number of units of inventory, number of lines on a purchase order, and so forth.
354
sample average
A key measure that represents the central tendency of a sample.
355
sample range
The largest value in a sample minus the smallest value in the sample.
356
scatter chart
A graphical technique to analyze the relationship between two variables. Two sets of data are plotted on a graph, with the y-axis used for the variable to be predicted and the x-axis used for the variable to make the prediction. The graph will show possible relationships. Although two variables might appear to be related, they might not be. Those who know most about the variables must make that evaluation. The scatter chart is one of the seven tools of quality. Syns.: cross plot, scatter diagram, scatterplot.
357
sample size
The number of elements selected for analysis from the population.
358
scatter diagram
Syn.: scatter chart.
359
scatterplot
Syn.: scatter chart.
360
sample standard deviation
A key measure that represents the spread or dispersion of a sample.
361
sampling
1) A statistical process in which generalizations regarding an entire body of phenomena are drawn from a relatively small number of observations. 2) In marketing, the delivery of free trial goods to consumers.
362
sampling distribution
The distribution of values of a statistic calculated from samples of a given size.
363
sampling plan
Within acceptance sampling, the determination of the sample size and the number of defectives that will trigger rejection of a lot.
364
sawtooth diagram
A quantity-versus-time graphic representation of the order point or order quantity inventory system showing inventory being received and then used up and reordered.
365
SBQ
Acronym for standard batch quantity.
366
SBT
Abbreviation for scan-based trading.
367
SBU
Acronym for strategic business unit.
368
scalability
1) How effectively a company can grow its business in order to meet demand. 2) How effectively the solution to a problem can be scaled up as the problem’s size increases.
369
scan-based trading (SBT)
As an item is sold, scanned information is sent to the manufacturer and creates a replacement order of that item. This process often is used in large retail store chains as well as at large-volume product producers.
370
Scanlon plan
A system of group incentives on a company-wide or plant-wide basis that sets up one measure that reflects the results of all efforts. The universal standard is the ratio of labor costs to sales value added by production. If there is an increase in production sales value with no change in labor costs, productivity has increased while unit cost has decreased.
371
scanner
An electronic device that optically converts coded information into electrical control signals for data collection or system transaction input.
372
scarcity
A concept central to economics that means less of a good is freely available than consumers would like.
373
SCEM
Acronym for supply chain event management.
374
scenario forecasts
Plans for how an organization will respond to anticipated future situations.
375
scenario planning
A planning process that identifies critical events before they occur and uses this knowledge to determine effective alternatives.
376
schedule
A timetable for planned occurrences (e.g., shipping schedule, master production schedule, maintenance schedule, or supplier schedule). Some schedules include the starting and ending times for activities (e.g., project schedule).
377
schedule activity
During a project, a specific piece of work performed that has estimated costs, duration, and resource requirements.
378
schedule board
Syn.: control board.
379
schedule chart
Usually a large piece of graph paper used in the same manner as a control board. Where the control board often uses strings and markers to represent plans and progress, the schedule chart is typically filled in with pencil. See: control board.
380
schedule control
Control of a plant floor by schedules rather than by job orders (called order control). Schedules are derived by taking requirements over a period of time and dividing that by the number of workdays allowed to run the parts or assemblies. Production completed is compared with the schedule to provide control. This type of control is most frequently used in repetitive and process manufacturing.
381
schedule harmony
The arrival of goods at a transfer point with a small buffer time in front of their departure via a different transportation mode.
382
schedule performance index (SPI)
Earned value divided by planned value, which measures a project’s schedule efficiency.
383
schedule variance (SV)
Earned value minus planned value, which measures a project’s schedule performance.
384
scheduled downtime
Planned shutdown of equipment or a plant to perform maintenance or to adjust to softening demand.
385
scheduled finish date
In project management, an activity’s planned finish time, normally between the early finish time and the late finish time. It may reflect resource limitations. Syn.: planned finish date.
386
scheduled load
The standard hours of work required by scheduled receipts (i.e., open production orders).
387
scheduled receipt
An open order that has an assigned due date. See: open order.
388
scheduled start date
In project management, an activity’s planned start time, normally between the early start time and the late start time. It may reflect resource limitations. Syn.: planned start date.
389
scheduler
A general term that can refer to a material planner, dispatcher, or a combined function.
390
scheduling
The act of creating a schedule, such as a shipping schedule, master production schedule, maintenance schedule, or supplier schedule.
391
scheduling algorithm
Syn.: scheduling rules.
392
scheduling rules
Basic rules that can be used consistently in a scheduling system. Scheduling rules usually specify the amount of time to allow for a move, queue, load calculation, and so forth. Syn.: scheduling algorithm.
393
scientific inventory control
Syn.: statistical inventory control.
394
scientific management
Managing a production system using scientific principles, usually those principles established by Frederick Taylor.
395
scope
In project management, the totality of products to be created by a project.
396
scope change
In project management, a change to a project’s scope, usually requiring an adjustment to the project’s budget and schedule.
397
scope creep
The informal addition of unfunded features and services to a project. Scope creep is closely monitored and controlled to ensure that agreed-upon output of a project can be achieved within the budgeted timeline and costs.
398
scope definition
In project management, subdividing a project into smaller components to facilitate management.
399
SCOR
Acronym for Supply Chain Operations Reference.
400
SCOR beginner
A Supply Chain Operations Reference (SCOR) competency level. A beginner has not fully mastered work skills and has a limited situational perception of work activities. A beginner is familiar with the basic process and can sequence the steps. The experienced beginner remains task- oriented rather than goal-oriented but is starting to get some perspective. A beginner treats all aspects of work separately but with equal importance.
401
SCOR competency level
A Supply Chain Operations Reference (SCOR) measure that describes the level or state of qualification to perform a certain role or tasks.
402
SCOR competent
A Supply Chain Operations Reference (SCOR) competency level. It represents an employee who acts consciously to satisfactorily perform long-term goals and plans. At this level, an employee is goal-oriented and able to figure out a sequence of tasks to accomplish a goal.
403
SCOR DS
An acronym for Supply Chain Operations Reference Digital Standard.
404
SCOR expert
A Supply Chain Operations Reference (SCOR) competency level. The expert has an intuitive understanding of the situation and zooms in on the central aspects to apply analytical reasoning, problem-solving techniques, and leadership. Experts understand what is possible and apply experience and knowledge to master new situations.
405
SCOR metrics
In Supply Chain Operations Reference (SCOR), metrics measure the ability of processes to achieve the strategic objectives associated with performance attributes. SCOR recognizes three levels of predefined metrics: Level 1 metrics are diagnostics for the overall health of the supply chain. Level 2 metrics serve as diagnostics for the level 1 metrics. Level 3 metrics serve as diagnostics for level 2 metrics.
406
SCOR novice
A Supply Chain Operations Reference (SCOR) competency level. A novice is an untrained beginner new to the field or activity. A novice needs standard, written procedures or step-by-step detailed instructions. A novice has no ability to make judgments based on a problem situation. Novices can neither judge whether the instructions are working nor judge which ones are important because they have no context to assess them against.
407
SCOR performance attribute
A classification for metrics used to formulate a strategic direction. The Supply Chain Operations Reference (SCOR) performance attributes are reliability, responsiveness, agility, cost, profit, assets, environmental, and social.
408
SCOR processes
One of the four parts of the Supply Chain Operations Reference (SCOR) framework. This section contains the standard descriptions of management procedures and their relationships.
409
SCOR proficient
A Supply Chain Operations Reference (SCOR) competency level. A proficient professional sees the situation as a whole and acts from personal knowledge and conviction. Proficient company professionals prioritize the importance of situations and use their knowledge and skills to focus on problem-solving.
410
SCOR team leader
In Supply Chain Operations Reference (SCOR) implementation, the primary coordinator and manager of the planning and execution phases of the SCOR improvement program.
411
scorecard
This is a performance measurement tool used by a company that summarizes its key performance indicators. Another use of scorecards is to measure the supply chain members and ensure that their performance is meeting company standards.
412
seasonal inventory
Inventory built up to smooth production in anticipation of a peak seasonal demand. Syn.: seasonal stock.
413
seasonal stock
Syn.: seasonal inventory.
414
seasonal variation
See: seasonality.
415
SCOR-Lean Sigma
The practice of combining elements from the Supply Chain Operations Reference (SCOR) model, lean thinking and six sigma to apply the most appropriate tools and techniques from each methodology to address the problem at hand.
416
seasonality
A predictable, repetitive pattern of demand measured within a year, during which time the demand grows and declines. These are calendar-related patterns that can appear annually, quarterly, monthly, weekly, daily and/or hourly. Syn.: seasonal variation. See: base series.
417
scrap
Material outside of specifications and possessing characteristics that make rework impractical.
418
SEC
Abbreviation for the Securities and Exchange Commission (U.S.).
419
scrap factor
A factor that expresses the quantity of a particular component that is expected to be scrapped upon receipt from a vendor, upon completion of production, or while that component is being built into a given assembly. It is usually expressed as a decimal value. For a given operation or process, the scrap factor plus the yield factor is equal to 1. For example, if the scrap factor is 30 percent (or .3), then the yield is 70 percent (or .7). In manufacturing planning and control systems, the scrap factor is usually related to a specific item in the item master but may be related to a specific component in the product structure. For example, if 50 units of a product are required by a customer and a scrap factor of 30 percent (a yield of 70 percent) is expected, then 72 units (computed as 50 units divided by .7) should be started in the manufacturing process. Syn.: scrap rate. See: yield, yield factor.
420
scrap rate
Syn.: scrap factor.
421
s-curve
In project management, a graphic display of cumulative project attributes such as costs, labor hours, or percentage of work. The name derives from the typical shape of the curve.
422
SDS
1) Abbreviation for single-digit setup. 2) Acronym for safety data sheet.
423
search models
Operations research models that attempt to find optimal solutions with adaptive searching approaches.
424
seasonal adjustment
Syn.: seasonal index.
425
seasonal component
A component of demand, usually describing the impact on demand of variations that occur because of the time of year (e.g., quarter, month or week). See: decomposition, time series analysis.
426
seasonal harmonics
Syn.: harmonic smoothing.
427
seasonal index
1) A number used to adjust data to seasonal demand. 2) Manipulations to the buffer size that affect inventory positions by adjusting buffers to follow seasonal patterns. Syn.: seasonal adjustment. See: base series.
428
secondary highways
Highways that are predominantly rural in nature.
429
second-order smoothing
A method of exponential smoothing for trend situations that employs two previously computed averages, the singly and doubly smoothed values, to extrapolate into the future. Syn.: double smoothing.
430
second-tier suppliers (or customers)
A supplier’s suppliers (or customer’s customers).
431
secular trend
The general direction of the long-run change in the value of a particular time series.
432
secure electronic transaction (SET)
In e-commerce, a system for guaranteeing the security of financial transactions conducted over the internet.
433
secure server
In e-commerce, a web server that protects users’ messages from interception while being transmitted over the internet.
434
Securities and Exchange Commission (SEC)
A U.S. government agency that has primary responsibility for enforcing the federal securities laws and regulating the securities industry. The SEC was created by the Securities Exchange Act of 1934 with a mission to protect investors; maintain fair, orderly, and efficient markets; and facilitate capital formation.
435
SED
Acronym for shipper’s export declaration.
436
segment customers
Grouping customers by common characteristics to facilitate sales.
437
seiketsu
A term that refers to standardization (e.g., standard locations for tools and equipment). See: five S’s.
438
seiri
A term that refers to organizing or throwing away things that are not needed. See: five S’s.
439
seiso
A term that states that a productive workplace is found through cleanliness. See: five S’s.
440
seiton
A term that refers to neatness in the workplace that is achieved by straightening offices and work areas. See: five S’s.
441
self-directed work team
Generally, a small, independent, self- organized, and self-controlling group in which members flexibly plan, organize, determine, and manage their duties and actions as well as perform many other supportive functions. The team may work without immediate supervision and can often have authority to select, hire, promote, or discharge its members.
442
sensitivity analysis
A technique for determining how much an expected outcome or result will change in response to a given change in an input variable. For example, for a given projected level of resources, a sensitivity analysis could determine the effect on net income if variable costs of production increased 20 percent.
443
self-service warranty claim submittal
A practice in which customers and service providers submit warranty claims through the internet, reducing internal validation and processing workload.
444
seller’s market
A market condition in which goods cannot easily be secured (purchased) and when the economic forces of business tend to cause goods to be priced at the supplier’s estimate of value.
445
selling and administrative costs
Those costs that are associated with the marketing, sales, and administrative functions of a plant or company. These costs are a function of overhead costing and an important number in the cost of goods sold calculation.
446
selling expense
An expense or class of expense incurred in selling or marketing (e.g., salespersons’ salaries and commissions, advertising, samples, or shipping costs).
447
selling, general, and administrative (SG&A) expenses
The fixed costs associated with a company. Examples are salaries, marketing costs, customer service costs, occupancy expenses, and other overhead. In retail, this is called the cost of selling.
448
sensors
Devices that can monitor differences in conditions to control equipment on a dynamic basis.
449
separable cost
A cost that is assignable to a given portion of a business.
450
sequencing
Determining the order in which a manufacturing facility is to process a number of different jobs in order to achieve certain objectives.
451
sequential
In numeric sequence, usually in ascending order.
452
sequential development process
A process in which the product or services idea must clear specific hurdles before it can go on the next development phase.
453
sequential-sampling plan
Controlling quality by repeatedly sampling units and each time making a decision to accept or reject a batch or to continue sampling.
454
serial number
A unique number assigned for identification to a single piece that will never be repeated for similar pieces. Serial numbers are usually applied by the manufacturer but can be applied at other points, including by the distributor or wholesaler.
455
semifinished goods
Products that have been stored in an uncompleted state and are awaiting final operations that will adapt them to different uses or customer specifications.
456
serial shipping container code
An 18-character designation identifying boxes or pallets that are part of a shipment covered by an automated shipment notice.
457
semipassive tag
A radio frequency identification tag that sends out data, is self-powered, and widens its range by harnessing power from the reader. See: radio frequency identification (RFID).
458
semiprocess flow
A manufacturing configuration in which most jobs go through the same sequence of operations even though production is in job lots.
459
semivariable costs
Costs that change in increments. They remain fixed over a given range and, outside that range, change to a new level.
460
semiworks
Syn.: pilot plant.
461
send ahead
The movement of a portion of a lot of material to a subsequent operation before completion of the current operation for all units of the lot. The purpose of sending material ahead is to reduce the manufacturing lead time. See: overlapped schedule.
462
sensing-
The translation of market data into operational and executional planning to better manage demand shaping and other commercial activities including price to manage assortment, run-out strategies, and new products.
463
serpentine picking
A picking technique aimed at reducing travel time by 50 percent and improving the flow of pickers down each aisle. This technique involves picking from both sides of each aisle as the picker goes down it. This is in contrast to picking from one side of the aisle and then crossing to the other side.
464
server
A computer or software package that provides a specific kind of service to client software running on other computers. The term can refer to a particular piece of software, a web server, or the machine on which the software is running. A single server machine could have several different server software packages running on it, thus providing many different servers to clients on the network.
465
server address
The internet address of a server.
466
server factory
A facility making minor improvements to products. It is set up primarily to avoid the host country’s barriers to trade.
467
service
Sometimes used to describe those activities that support the production or distribution functions in any organization, such as customer service and field service.
468
service acceptance criteria
A set of criteria used to ensure that a service meets its functionality and quality requirements prior to customer acceptance.
469
service industry supply chain
A supply network that transforms resources into services, with or without physical products, to satisfy customer needs.
470
service availability
The ability of a service or service component to perform its required function at or over an agreed period of time.
471
service blueprint
A service analysis method that allows service designers to identify processes involved in the service delivery system, isolate potential failure points in the system, establish time frames for the service delivery, and set standards for each step that can be quantified for measurement.
472
service bureau model
A business strategy in which a company outsources certain products and services from another company. The company prefers to concentrate on its core business rather than expending resources on the outsourced item.
473
service capacity
The number of daily customers a firm is designed to serve. Actual throughput may be larger or smaller.
474
service catalog
A database or structured document with information about all available services. The service catalog is part of the service portfolio and contains information about two types of services: (1) customer-facing services that are visible to the business and (2) supporting services required by the service provider to deliver customer-facing services. See: service portfolio.
475
service component
Part of a service that when combined with other elements will deliver a complete service.
476
service continuity
The capability to deliver a service without interruption or with consistent availability as agreed.
477
service desk
The single point of contact between users and the service provider that manages incidents and service requests and also handles communication with the users.
478
service factor
Syn.: safety factor.
479
service failure analysis
A technique that identifies the underlying causes of any situation or event that can cause damage to the customer's satisfaction during the service process. See: failure analysis, failure mode analysis (FMA), failure mode and effects analysis (FMEA).
480
service function
The mathematical relationship of the safety factor to the service level (e.g., the fraction of demand routinely met from stock).
481
service industry
1) In its narrowest sense, an organization that provides an intangible product (e.g., medical or legal advice). 2) In its broadest sense, all organizations except farming, mining, and manufacturing. The service industry includes retail trade; wholesale trade; transportation and utilities; finance, insurance, and real estate; construction; professional, personal, and social services; and local, state, and federal governments.
482
service knowledge management system
A set of tools and databases that are used to manage service knowledge, information, and data. The system typically includes tools for collecting, storing, managing, updating, analyzing, and presenting all the knowledge, information, and data that a service provider will need to manage the full life cycle of the services.
483
service level
Syn.: level of service.
484
service level target
Specific measurable characteristics of a service that an organization commits to achieving.
485
service life cycle
An approach to service management that emphasizes the importance of coordination and control across the various functions, processes, and systems necessary to manage the full life cycle of services. The cycle considers the strategy, design, transition, operation, and continual improvement of services.
486
service lifetime
The duration of restorative and regenerative cycles in circular supply chain management that represents the period from the substance’s extraction from the earth until it is discarded. This lifetime indicates how long a substance is used, recovered, and reused until it is incinerated or landfilled. See: circular economy.
487
service management
A set of capabilities and processes to direct and control the organization's activities and resources for planning, design, transition, delivery, and improvement of services to deliver value to customers.
488
service management system
A system that includes service management policies, objectives, plans, processes, documented information, and resources required for the planning, design, transition, delivery, and improvement of services to meet service requirements. See: service requirement.
489
service parts
Those modules, components, and elements that are planned to be used without modification to replace an original part. Syns.: repair parts, spare parts.
490
service parts demand
The need or requirement for a component to be sold by itself, as opposed to being used in production to make a higher-level product. Syns.: repair parts demand, spare parts demand.
491
service parts revenue
The value of sales of replacement parts to external and internal customers, net of discounts and coupons.
492
service phases
The number of phases necessary to service a new arrival in the system.
493
service pipeline
A database or structured document listing all services that are under consideration for development but are not yet available to customers. The pipeline provides a business view of possible futures services and is part of the service portfolio that is not normally published to customers. See: service portfolio.
494
service portfolio
The complete set of services that is managed by a service provider. The portfolio is used to manage the entire life cycle of all services and includes three categories: (1) service pipeline (proposed or in development), 2) service catalog (live or available for deployment), and (3) retired services.
495
service positioning
Syn.: product positioning.
496
service provider
An organization that manages and delivers a service or services to customers.
497
service rate
In queuing theory, the rate at which arrivals are processed through the production or service system or the number of processed arrivals per unit of time. See: queuing theory.
498
service reliability
A dimension of service quality referring to the capability of a service provider to perform dependably and accurately.
499
service request
A request for information, advice, or access to a service or a pre-approved change. The request typically initiates a service action that has been agreed upon as a normal part of the service delivery.
500
service requirement
All of the customer, user, and organizational needs related to services and the service management system that are stated or obligatory.
501
service response logistics
Obtaining, producing, and distributing material for wholesaling and retailing. Supply chain management logistics focuses on location, service, and capacity issues. Syn.: integrated logistics.
502
service time
The time taken to serve a customer (e.g., the time required to fill a sales order or the time required to fill a request at a tool crib).
503
service transition
All the activities involved in moving a new or modified service to or from the live environment.
504
service versus investment chart
A curve showing the amount of investment that will be required to give various levels of customer service. Typical investments include inventory, infrastructure, labor, and other resources to improve customer service.
505
serviceability
1) A design characteristic that facilitates the easy and efficient performance of service activities. Service activities include those activities required to keep equipment in operating condition, such as lubrication, fueling, oiling, and cleaning. 2) A measurement of the degree to which servicing of an item will be accomplished within a given time under specified conditions. See: maintainability. 3) The competitive advantage gained when an organization focuses on aspects such as the speed and courtesy with which customer complaints and questions are answered, following up with customers after the sale to ensure satisfaction, and offering on-site service for product repairs. 4) A measure of repairs and maintenance based on cost, speed, and convenience.
506
service-level agreement (SLA)
A document that represents the terms of performance for organic support between a service provider and a customer. The agreement describes the service, documents service level targets, and specifies the responsibilities of the information technology service provider and the customer. A single agreement may cover multiple services or multiple customers.
507
service-oriented architecture (SOA)
A style of information technology (IT) design that guides all aspects of creating and using business services throughout their life cycles as well as defining and provisioning the IT infrastructure that enables different computer applications to exchange data and participate in business processes, regardless of the operating systems or programming languages underlying those applications.
508
servo system
A control mechanism linking a system’s input and output that is designed to feedback system output data to regulate the operation of the system.
509
SET
Acronym for secure electronic transaction.
510
setup
1) The work required to change a specific machine, resource, work center, or line from making the last good piece of item A to making the first good piece of item B. 2) The refitting of equipment to neutralize the effects of the last lot produced (e.g., teardown of the just-completed production or preparation of the equipment for production of the next scheduled item). Syns.: changeover, turnaround time.
511
setup costs
Costs such as scrap costs, calibration costs, downtime costs, and lost sales associated with preparing the resource for the next product. Syns.: changeover costs, turnaround costs.
512
setup flexibility
The ability for changeover to a different product to take place with little delay.
513
setup lead time
Syn.: setup time.
514
setup time
The time required for a specific machine, resource, work center, process, or line to convert from the production of the last good piece of item A to the first good piece of item B. Syn.: setup lead time.
515
seven new tools of quality (N7)
A set of quality improvement tools developed by the Union of Japanese Scientists and Engineers (JUSE). The N7 are affinity diagram, interrelationship digraph, matrix diagram, tree diagram, prioritization matrix, process decision program chart, and activity network diagram. See: basic seven tools of quality (B7).
516
seven tools of quality
Syn.: basic seven tools of quality (B7).
517
seven wastes
The common forms of waste identified in the lean or just-in-time philosophy that limit improvement. These include overproduction, inventory waste, motion waste, defects, waiting, and transport waste. These are often referred to as Shingo's seven wastes, named after Shigeo Shingo a pioneer in the lean or just-in-time philosophy.
518
seven zeros
The seven zeros are an essential part of the Toyota Production System. They are zero defects, zero excess lot size, zero setups, zero breakdowns, zero excess handling, zero lead time, and zero surging.
519
SG&A
Abbreviation for selling, general and administrative.
520
shape
An element of variability results that measures the output of a process. If a process results in product dimensions falling within a bell-shaped curve, then the process is running normally.
521
shared services
Consolidation of support processes to form a separate unit to provide services to the parent company and external customers. This lowers costs and may improve support because the shared services unit is more focused.
522
shareholder wealth
The present value of all anticipated payments to the shareholders of a firm.
523
shelf life
The amount of time an item may be held in inventory before it becomes unusable.
524
shelf-life control
A technique of physical first in, first out usage aimed at minimizing stock obsolescence.
525
Shewhart circle of quality
Syn.: plan-do-check-action (PDCA).
526
Shewhart cycle
Syn.: plan-do-check-action (PDCA).
527
ship-age limit
The date after which a product cannot be shipped to a customer.
528
shipper’s export declaration (SED)
An export/import document prepared by the shipper before a shipment can be exported and presented to a government authority of the country in which the shipper resides. It specifies details about the goods to be shipped, including their value, weight, and destination.
529
shipper-carriers
Companies that ship goods in their own vehicles. Many large retailers are shipper-carriers because they own their own fleets.
530
shipping
The function that performs tasks for the outgoing shipment of parts, components, and products. It includes packaging, marking, weighing, and loading for shipment.
531
shipping documents
The documents needed for international or domestic transportation of goods.
532
shipping lane
A specific route that ocean liners take between ports to help traffic flow and to avoid the most dangerous areas of the ocean.
533
shipping lead time
The number of working days normally required for goods to move between a shipping and receiving point plus acceptance time in days at the receiving point.
534
shipping manifest
A document that lists the pieces in a shipment. A manifest usually covers an entire load regardless of whether the load is to be delivered to a single destination or to many destinations. Manifests usually list the items, piece count, total weight, and the destination name and address for each destination in the load.
535
shipping order
A document similar to a shipping manifest except this document also specifies the method of shipping. See: shipping manifest.
536
shipping order debit memo
The document used to authorize the shipment of rejected material back to the supplier and create a debit entry in accounts payable.
537
shipping point
The location from which material is sent. Ant.: receiving point.
538
shipping tolerance
An allowable deviation that the supplier can ship over or under the contract quantity.
539
shipping, receiving, and traffic clerk
A warehouse employee who is responsible for organizing, sorting, and transferring goods from one location to another.
540
ship-to-stock
See: dock-to-stock.
541
shitsuke
The effort and discipline required to continually enforce changes made in an organization. See: five S’s.
542
shojinka
Continually balancing the number of workers in a work center to meet demand with a minimum number of workers to improve flow. It requires a line design—for example, U-shaped—that supports varying the number of workers.
543
shop calendar
Syn.: manufacturing calendar.
544
shop committee
The committee that represents the union in its relations and negotiations with a company or plant. This is the first stage for the unionized employees to vet complaints.
545
shop floor control
A system for using data from the shop floor to maintain and communicate status information about shop orders (manufacturing orders) and work centers. Shop floor control can use order control or flow control to monitor material movement through the facility. The major subfunctions of shop floor control are: (1) assigning priority of each shop order; (2) maintaining working-process quantity information; (3) conveying shop order status information to the office; (4) providing actual output data for capacity control purposes; (5) providing quantity by location by shop order for work-in- process inventory and accounting purposes; and (6) providing measurement of the efficiency, utilization, and productivity of the workforce and machines. The major subfunctions for flow control are based primarily on production rates and feeding work into production to meet these planned rates and then monitoring and controlling production. See: flow control, order control, production activity control (PAC).
546
shop order
Syn.: manufacturing order.
547
shop order close-out station
A stocking point on the shop floor where completed production of components is transacted (received) into and subsequently transacted (issued) to assembly or other downstream operations. This technique is used to reduce material handling by avoiding the need to move items into and out of stockrooms while simultaneously enabling a high degree of inventory record accuracy.
548
shop order reporting
Syn.: production reporting and status control.
549
shop packet
A package of documents used to plan and control the shop floor movement of an order. The packet may include a manufacturing order, operations sheets, engineering blueprints, picking lists, move tickets, inspection tickets, and time tickets.
550
shop planning
The function of coordinating the availability of materials handling, materials, resources, setup, and tooling so that an operation or job can be done on a particular machine. Shop planning is often part of the dispatching function. The term shop planning is sometimes used interchangeably with dispatching, although dispatching does not necessarily include shop planning. For example, the selection of jobs might be handled by the centralized dispatching function, while the actual shop planning might be done by the foreman or a representative.
551
shop scheduling
Syn.: operations scheduling.
552
shop traveler
Syn.: traveler.
553
shortage cost
The marginal profit that is lost when a customer orders an item that is not immediately available in stock.
554
shortage gaming
When suppliers ration or apportion supplies and buyers, in response, inflate their orders in an attempt to receive what they actually need.
555
short-cycle manufacturing
Syn.: just in time (JIT).
556
shortest processing time (SPT) rule
A dispatching rule that directs the sequencing of jobs in ascending order by processing time. If this rule is followed, the greatest number of jobs at a work center per time period will be processed. As a result, the average lateness of jobs at that work center is minimized, but some jobs will be very late. Syn.: smallest processing time rule.
557
short-haul discrimination
A pricing strategy in which more is charged for a shorter haul than for a longer haul when the route and the delivery are the same. It is used to push the long-haul process.
558
short-range planning horizon
A planning or forecasting time frame encompassing a few days to at most a few weeks.
559
short-sea shipping
A form of water transportation that does not cross an ocean but instead utilizes coastal and inland waterways to move shipments from maritime ports to their destination. It is often used as an alternative to road transportation.
560
short-term planning
The function of adjusting limits or levels of capacity within relatively short periods of time, such as parts of a day, a full day, or a week.
561
should cost modeling
A process where a customer uses a supplier's mindset to estimate costs typically incurred by a supplier that are rolled into an item's price. The method helps customers determine what a product should cost based on estimated costs for raw materials, labor and production overhead as well as the profit margin.
562
shrinkage
See: inventory shrinkage.
563
shrinkage factor
A percentage factor used to compensate for the expected loss during the manufacturing cycle of an item. This factor differs from the scrap factor in that it affects all components of the item, while the scrap factor relates to only one component’s usage. Syn.: shrinkage rate.
564
shrinkage rate
Syn.: shrinkage factor.
565
SIC
Acronym for standard industrial classification.
566
short haul
Transporting goods a relatively short distance in terms of area traveled. The actual distance that is considered short would be specific to the mode of transport, for example, airplane versus motor carrier.
567
sideways loading
Loading pallets by turning them so the wider 48-inch side is facing you.
568
sigma
A Greek letter (∑) commonly used to designate the standard deviation of a population.
569
short shipment
A situation in which a piece of freight designated by the shipping document is missing from delivery.
570
signed message
In information systems, a message for which the sender can be authenticated.
571
significant part number
A part number that is intended to convey certain information, such as the source of the part, the material in the part, or the shape of the part. Using numbers to represent this information usually makes these part numbers longer than corresponding nonsignificant part numbers. Ant.: nonsignificant part number.
572
significant variances
Those differences between planned and actual performance that exceed established thresholds and that require further review, analysis, and action.
573
silo effect
A mindset affecting an organization in which departments or groups do not share information, goals, priorities, tools, and/or processes with other departments or functions. Organizations that have this mindset are often referred to as being siloed.
574
simple interest
1) Interest that is not compounded (i.e., interest not added to the income-producing investment or loan). 2) The interest charged under the condition that interest in any time period is only charged on the principal.
575
simple moving average
A moving average where the oldest data point is dropped and the newest data point is included in the calculation. All data points are assigned equal weights. See: moving average, weighted moving average.
576
simple regression
Regression analysis involving only one independent variable.
577
simplex algorithm
A procedure for solving a general linear programming problem.
578
simplex method
An approach to solving linear programming models.
579
simplification
Improving quality and cutting costs by removing complexity from a product or service.
580
simulation
1) The technique of using representative or artificial data to reproduce in a model various conditions that are likely to occur in the actual performance of a system. It is frequently used to test the behavior of a system under different operating policies. 2) Within manufacturing resource planning, using the operational data to perform what-if evaluations of alternative plans to answer the question, “Can we do it?” If yes, the simulation can then be run in the financial mode to help answer the question, “Do we really want to?” See: what-if analysis.
581
simultaneous design/engineering
Syn.: participative design/ engineering.
582
simultaneous engineering
Syn.: participative design/ engineering.
583
single exponential smoothing
Syn.: first-order smoothing.
584
single integrator solution
An enterprise resource planning implementation chosen entirely from one vendor.
585
single smoothing
Syn.: first-order smoothing.
586
single sourcing
A method of supply in which a company strategically selects only one supplier for a purchased good or service in an effort to establish a strategic relationship that fosters high quality, high reliability, short lead times, and cooperative interactions. In contrast, organizations often have at least two suppliers for each purchase to ensure continuity of supply or to foster price competition between the suppliers.
587
single-card kanban system
Syn.: one-card kanban system.
588
single-channel, single-phase system
A queuing system that has only one channel for arrivals to enter and only one phase to completely service the arrival.
589
single-digit setup (SDS)
The idea of performing setups in less than 10 minutes. See: single-minute exchange of die (SMED).
590
single-factor productivity
The average amount of a given product (output) attributed to a unit of a given resource (input). Factors include labor and capital. Syn.: partial productivity factor. See: multifactor productivity.
591
single-level backflush
A form of backflush that reduces inventory of only the parts used in the next level down in an assembly or subassembly.
592
single-level bill of material
A display of components that are directly used in a parent item. It shows only the relationships one level down.
593
single-level where-used
Documentation for a component that lists each parent in which that component is directly used and in what quantity. The documentation is usually made available through the technique known as implosion.
594
single-minute exchange of die (SMED)
The lean concept of ensuring setup times are less than 10 minutes in order to reduce inefficiency in manufacturing. See: single-digit setup (SDS).
595
single-period inventory models
Inventory models used to define economical or profit-maximizing lot-size quantities when an item is ordered or produced only once (e.g., newspapers, calendars, tax guides, greeting cards, or periodicals) while facing uncertain demands. Syn.: static inventory models.
596
single-sampling plan
A quality control method of taking only one sample and then making a decision to accept or reject a batch of items.
597
single-source supplier
A company that is selected to have 100 percent of the business for a part although alternate suppliers are available. See: sole-source supplier.
598
SIPOC
Acronym for supplier, input, process, output, customer. It is pronounced “sye-pahk.”
599
six sigma
A methodology that furnishes tools for the improvement of business processes. The intent is to decrease process variation and improve product quality.
600
six sigma quality
The six sigma approach is a set of concepts and practices that focuses on reducing variability in processes and reducing deficiencies in the product. Important elements are (1) producing only 3.4 defects for every 1 million opportunities or operations and (2) process improvement initiatives striving for six sigma-level performance. Six sigma is a business process that permits organizations to improve bottom-line performance by creating and monitoring business activities to reduce waste and resource requirements while increasing customer satisfaction.
601
skew
The degree of nonsymmetry shown by a frequency or probability distribution.
602
skid
A type of pallet that does not have a bottom deck. See: pallet.
603
skill-based compensation
A method of employee compensation that bases the employee’s wage rate on the number of skills the employee is qualified to perform. People who are qualified to do a wider variety of skills are paid more. See: labor grade.
604
skills inventories
An organized file of information on each employee’s skills, abilities, knowledge, and experience, usually maintained by a personnel office. See: labor grade.
605
skills matrix
A visual tool to show the skills and skill levels of employees. It is used primarily when forming a team so the leader knows what skills are necessary to accomplish the team’s goals. It also is used when implementing a full cross-training process to ensure that all workers are cross-trained to the same levels.
606
SKU
Acronym for stock keeping unit. It is pronounced “skew.”
607
SLA
Abbreviation for service-level agreement.
608
slack
Syns.: float, slack time.
609
slack time
In project management, the amount of time that an activity may be delayed from its early start without delaying the project finish date. Syn.: slack.
610
slack time rule
A dispatching rule that directs the sequencing of jobs based on slack time. Slack time is calculated as (days left until due date multiplied by hours per day) minus standard
611
hours of work left on a specific job. For example, (5 × 8)
12 = 28 hours of slack. The smaller the amount of slack time for a specific job is, the higher the priority that job becomes in the sequence.
612
slip sheets
Thin sheets of fiberboard or plastic on which product is stacked. These are used as an alternative to wood pallets because they take up little space in warehouses or shipping containers. They sometimes are used in place of a pallet if the items are not strong enough to withstand being stacked on heavy pallets.
613
slot-based production
A term used in lean manufacturing that describes a production schedule that is held level but leaves some openings to meet unexpectedly high levels of demand. It is part of the extra capacity planning process.
614
slow-moving inventory monitoring
Regularly reviewing stock keeping units with stock levels that are higher than their total consumption within the last 12 months. Slow-moving inventory is classified into three reason codes: opportunistic stock, technical (supply) reasons, and market (demand) reasons.
615
slow-moving items
Those inventory items that have a low turnover or a relatively low rate of usage compared with the normal amount of inventory carried.
616
slushy zone
The time period between the frozen zone and the liquid zone when changes to the master production schedule can often be accommodated because capacity and material are committed to a lesser extent. See: frozen zone, liquid zone.
617
smallest processing time rule
Syn.: shortest processing time (SPT) rule.
618
small-group improvement activity
An organizational technique for involving employees in continuous-improvement activities. See: quality circle.
619
SMART
Acronym for specific, measurable, achievable (or attainable), relevant (or realistic), and timely, as related to a description of organizational goals.
620
smart contracts
A self-executing contract with the terms of an agreement between a buyer and a seller written into lines of blockchain code. These contracts use technology to automatically ensure that contract terms are met. If a new action, transaction, or other information is added to the blockchain—or decentralized digital ledger of the agreement— that does not match the terms of the agreement already included in the blockchain, the information will be rejected, thus ensuring that all parties adhere to the contract.
621
smart label
A label with an embedded radio frequency identification tag.
622
smart logistics
Incorporating technologies into supply chain logistics processes to increase the efficiency of logistics operations and the flow of goods.
623
smart materials handling
The process of automated short- distance movement of goods within a facility.
624
smart operations
A highly responsive, adaptive, digitized, and connected function integrated into the digital supply network that synchronizes all aspects of production and operations. This function drives significant performance and safety improvements in production, particularly in regard to quality and maintenance, repair, and overhaul (MRO).
625
SMED
Abbreviation for single-minute exchange of die.
626
smoothing
The process of averaging data by a mathematical process or by curve fitting, such as the least-squares method or exponential smoothing.
627
smoothing constant
In exponential smoothing, the weighting factor that is applied to the most recent demand, observation, or error. In this case, the error is defined as the difference between actual demand and the forecast for the most recent period. The weighting factor is represented by the symbol a. Theoretically, the range of a is 0.0 to 1. Syns.: alpha factor, smoothing factor.
628
smoothing factor
Syn.: smoothing constant.
629
smoothing inventories
Inventories used when upstream production levels are less than downstream demand.
630
smoothing models
Another name for forecasting models that utilize moving averages. The forecast is smoothed in the sense that averages have less variability than individual periods.
631
SOA
Abbreviation for service-oriented architecture.
632
social responsibility
Commitment by top management to behave ethically and to contribute to community development. This may also entail improving the workforce’s quality of life.
633
software
A set of programs used to direct the operation of a computer.
634
software-as-a-service (SaaS)
A software licensing and distribution model that provides access to applications via the internet on a subscription basis. A service provider hosts the application at its data center and customers access it through a web browser. This is often referred to as on-demand software and used by companies to avoid purchasing, implementing and maintenance costs.
635
sole proprietorship
A form of business in which one person has ownership and control. See: partnership.
636
sole source
A supply situation where the supply of a good or service is available from only one organization. Usually technical barriers, such as patents, complex tooling, or component designs, preclude other suppliers from offering the product.
637
sole-source supplier
See: sole source.
638
source document
An original written or printed record of some type that is to be converted into machine-readable form.
639
source execution
The ability to digitize sourcing processes to quickly assess supplier quotes and decision criteria, including comparisons with cost analytics and commodity indexes, in order to select the best suppliers. The quick screening includes self-service registration for suppliers, competitive bidding, and online negotiations.
640
source inspection
Inspection at the source of supply or production (e.g., the supplier or the work center) as opposed to inspection following receipt from the supplier or following transfer of the items from one work center to another.
641
sourcing
The process of identifying a company that provides a needed good or service.
642
sourcing decisions
High-level decisions regarding which products or services will be produced within a company and which will be purchased from external supply chain partners. These decisions normally are based on supplier cost and capability compared with producing the product in-house.
643
Southern Common Market (Mercosur)
A market and customs alliance between Argentina, Brazil, Paraguay, and Uruguay created by the Treaty of Asunción (1991).
644
space buffer
Physical space immediately after the constraint that can accommodate output from the constraint when there is a stoppage downstream that would otherwise force the constraint to stop also.
645
spare parts
Syn.: service parts.
646
spare parts demand
Syn.: service parts demand.
647
SPC
Acronym for statistical process control.
648
special cause
Syn.: assignable cause.
649
special warranty
An assurance that the product is fit for the specific purpose for which the product will be used. See: general warranty, warranty.
650
specialization
Producing a limited product line in order to focus on a product or a process. Specialization is often intended to improve productivity and reduce costs.
651
solid waste generated
One of the five green SCOR metrics that measures the total solid waste generated by the process.
652
sorting
The function of physically separating a homogeneous subgroup from a heterogeneous population of items.
653
special-purpose machinery
Machines that are designed to perform a small number of activities. They are not as flexible as general-purpose machinery but they may be faster and more accurate.
654
source
The activities involved in scheduling product deliveries, receiving products, verifying products, transferring (moving) products, and authorizing supplier payment. Activities associated with supplier search, qualification, and contract negotiation are not described using these process elements.
655
specific identification
A method of keeping track of the units of the beginning inventory and the units purchased—that is, specific identification of the purchase cost of each item. This may be done through a coding method or serial number identification.
656
source cycle time
The average amount of time associated with source stock production, make-to-order, and engineer-to- order processes.
657
specific performance
A contract remedy requiring defendants to do what they have contracted to do.
658
specification
A clear, complete, and accurate statement of the technical requirements of a material, an item, or a service and of the procedure to determine if the requirements are met.
659
specification development
A systematic statement of the requirements to be satisfied in the supply of a product or service. The specification defines the business requirements clearly, and the requirements are communicated to suppliers to facilitate the evaluation of goods and services against the agreed specifications. See: specification standardization.
660
specification limits
Syn.: tolerance limits.
661
specification standardization
The practice of unifying and merging specifications of components or services procured to realize benefits such as economy of scale. With such standardization, part and supplier proliferation can be reduced through the elimination of superficial, accidental, and deliberate differences between similar parts.
662
speculative buying
Purchasing an item not immediately needed in anticipation of a future price increase. See: buying down, hedge, hedging.
663
speed of design process
The time frame within which a product or service is designed to satisfy customer needs and regulations and field-tested before entering a market.
664
spend analysis
A purchasing activity in which an organization explores its spending patterns to identify opportunities to reduce costs or improve quality. This activity is part of value analysis as well as cost-benefit analysis.
665
spend management
Managing the outflow of funds in order to buy goods and services. The term is intended to encompass such processes as outsourcing, procurement, e-procurement, and supply chain management.
666
SPI
Acronym for schedule performance index.
667
spike
A significant large upward or downward movement of a value level in a short period of time.
668
split delivery
A method by which a larger quantity is ordered on a purchase order to secure a lower price, but delivery is divided into smaller quantities and spread out over several dates to control inventory investment, save storage space, and so forth.
669
split lot
A manufacturing order quantity that has been divided into two or more smaller quantities, usually after the order has been released. The quantities of a split lot may be worked on in parallel, or a portion of the original quantity may be sent ahead to a subsequent operation to be worked on while work on the remainder of the quantity is being completed at the current operation. The purpose of splitting a lot is to reduce the lead time of the order.
670
split-case order picking
A process for filling less-than-full case orders. It requires items to be picked from a case or other container.
671
spoiled work order
Syn.: rework order.
672
sponsor
A person who provides financial support, in cash or in kind.
673
spot buy
A purchase made on a one-time basis for standard off-the-shelf material or equipment.
674
spot demand
Short lead-time demand that is difficult to estimate. Usually supply for this demand is provided at a premium price.
675
spot stock warehousing
Positioning seasonal items in proximity to the market. When the season ends, these items are either disposed of or relocated to a more centralized location.
676
spread
Variability of an action. It is often measured by the range or standard deviation of a particular dimension.
677
spreadsheet
A computer application that stores and organizes data in a tabular form. These programs also typically offer a wide range of functions that can be used to analyze the data.
678
SPT
Acronym for shortest processing time, as in shortest processing time rule.
679
SQC
Acronym for statistical quality control.
680
SQL
Acronym for structured query language.
681
square root rule
A technique that assists planners with calculating the change in total safety stock needed to maintain customer service levels within a distribution network when the number of stocking locations is changed. The square root rule states that total safety stock inventories in a specified number of facilities can be approximated by multiplying the total amount of inventory in existing facilities by the square root of the ratio of the number of future facilities divided by the number of existing facilities.
682
SRM
Acronym for supplier relationship management.
683
stabilization stock
An inventory that is carried on hand above the base inventory level to provide protection against incurring overtime or downtime.
684
stable demand
Products that keep a similar demand pattern no matter what the season or time. Staple products fall into this category.
685
stacked lead time
Syn.: cumulative lead time.
686
staged material
Syn.: kit.
687
staging
Pulling material from inventory before it is required. This action is often taken to identify shortages or to undergo an additional operation such as testing or programming. Organizations should be careful that staging does not lead to increased problems with inventory availability or accuracy. See: staging and consolidation.
688
staging and consolidation
Physically moving material from the packing area to a staging area based on a prescribed set of instructions related to a particular outbound vehicle or delivery route, often for shipment consolidation purposes.
689
stakeholder
Any individual or group that has an interest that is affected or could be affected by the organization’s activities. These include business partners, civil society organizations, consumers, customers, employees and other workers, managers, governments, local communities, non-governmental organizations, shareholders and other investors, suppliers, trade unions, or vulnerable groups.
690
stakeholder relationship management
Addressing and managing the competing priorities, needs, and concerns of internal and external stakeholders in a proactive and sustained manner, resulting in decreased cost and enhanced stakeholder acceptance or buy-in.
691
standard
1) An established norm against which measurements are compared. 2) An established norm of productivity defined in terms of units of output per set time (e.g., units per hour) or in standard time (e.g., minutes per unit). 3) The time allowed to perform a specific job including quantity of work to be produced. See: standard time.
692
standard allowance
The established or accepted amount by which the normal time for an operation is increased within an area, plant, or industry to compensate for the usual amount of personal, fatigue, and unavoidable delay times.
693
standard batch quantity (SBQ)
The quantity of a parent that is used as the basis for specifying the material requirements for production. The quantity per is expressed as the quantity to make the SBQ, not to make only one of the parent. This measurement is often used by manufacturers that use some components in standard quantities or by process-related manufacturers. Syn.: run size.
694
standard components
Components of a finished product that are easy to manufacture and are made by many suppliers, making them more of commodity to buy at low cost.
695
standard containers
Predetermined, specifically sized containers used for storing and moving components. These containers protect the components from damage and simplify the task of counting components.
696
standard cost accounting system
A cost accounting system that uses cost units determined before production for estimating the cost of an order or product. For management control purposes, the standards are compared with actual costs, and variances are computed.
697
standard costs
The target costs of an operation, process, or product, including direct material, direct labor, and overhead charges.
698
standard deviation
A measurement of dispersion of data or of a variable. The standard deviation is computed by finding the differences between the average and actual observations, squaring each difference, adding the squared differences,
699
dividing by n
1 (for a sample), and taking the square root of the result. See: estimate of error.
700
standard error
A measurement of the variability of statistics such as the sample mean. See: estimate of error.
701
standard hours
Syn.: standard time.
702
standard industrial classification (SIC)
Classification codes that are used to categorize companies into industry groupings.
703
standard operating procedure
Step-by-step instructions made by an organization to help workers carry out complex routine operations. See: standardized work.
704
standard output
An estimate of what should be produced given a certain level of resources. It can be stated in units per hour or units per period (day, shift, etc.).
705
standard practice
The means by which a wide range of organizations and supply chains have historically conducted operations. These well-established practices provide good performance but do not provide a significant cost or competitive advantage over emerging and best practices. Implementation of this type of practice involves low risk and results in acceptable performance.
706
standard ratio
A relationship based on a sample distribution by value for a particular company. When the standard ratio for a particular company is known, certain aggregate inventory predictions can be made (e.g., the amount of inventory increase that would be required to provide a particular increase in customer service).
707
standard service
Service that is the same for most customers.
708
standard time
The length of time that should be required to (1) set up a given machine or operation and (2) run one batch or one or more parts, assemblies, or end products through that operation. It is used in determining machine requirements and labor requirements. It assumes an average worker who follows prescribed methods and allows time for personal rest to overcome fatigue and unavoidable delays. It also is frequently used as a basis for incentive pay systems and as a basis of allocating overhead in cost accounting systems. Syn.: standard hours. See: standard.
709
standardization
1) The process of designing and altering products, parts, processes, and procedures to establish and use standard specifications for them and their components. 2) Reduction of the total numbers of parts and materials used and products, models, or grades produced. 3) The function of bringing a raw ingredient into standard (acceptable) range per the specification before introduction to the main process.
710
standardized ingredient
A raw ingredient that has been preprocessed to bring all its specifications within standard ranges before it is introduced to the main process. This preprocessing minimizes variability in the production process.
711
standardized product
A product that can be made in large quantities or continuously because it has very few product designs.
712
standardized work
A work process that is always carried out exactly the same way, preferably using the current best-known way under which the output can be achieved.
713
standing capacity
Syn.: rated capacity.
714
standing order
Syn.: blanket purchase order.
715
star
A slang term used to refer to a high-growth, high-profit- margin product. See: growth-share matrix.
716
start date
In project management, the time an activity begins. It may be defined as an actual start date or a planned start date.
717
start manufacture to order complete manufacture
The time from when the manufacturing of an order starts until an order is ready to be shipped to the customer.
718
start-to-finish
In project management, a network requirement that activity A must start before subsequent activity B can finish. See: logical relationship.
719
start-to-start
In project management, a network requirement that activity A must start before subsequent activity B can start. See: logical relationship.
720
startup
1) That period starting with the date of initial operation during which the unit is brought up to acceptable production capacity and quality within estimated production costs. 2) The activity that commences on the date of initial activity and has significant duration on most projects but is often confused (used interchangeably) with date of initial operation.
721
startup audit
The technique of having an implementation team tour or visit the implementation site on a frequent basis and use the management by walking around technique to identify problems and solutions.
722
startup costs
The extra operating costs to bring the plant or product on-stream incurred between the completion of construction and the start of normal operations. In addition to the difference between actual operating costs during that period and normal costs, startup costs include employee training, equipment tests, process adjustments, salaries and travel expenses of temporary labor staff and consultants, report writing, post-startup monitoring, and associated overhead. Additional capital required to correct plant problems may be included. Startup costs are sometimes expensed over the lifetime of the asset(s).
723
statement of cash flows
Syn.: funds flow statement.
724
statement of work
1) A description of products to be supplied under a contract. 2) In project management, the first project planning document that should be prepared. It describes the purpose, history, deliverables, and measurable success indicators for a project. It also captures the support required from the customer and identifies contingency plans for events that could throw the project off course. Because the project must be validated for management, staff, and review groups, the statement of work should be a persuasive document.
725
static budget
Syn.: master budget.
726
static inventory models
Syn.: single-period inventory models.
727
statistical control
The situation in which variations among the observed samples can be attributed to a constant system of chance causes.
728
statistical control charts
A chart on which data is collected from physical measurements or customer surveys and plotted so that conformance to specifications or customer satisfaction can be tracked and improved.
729
statistical inventory control
The use of statistical methods to model the demands and lead times experienced by an inventory item or group of items. Demand during lead time and between reviews can be modeled, and reorder points, safety stocks, and maximum inventory levels can be defined to strive for desired customer service levels, inventory investments, manufacturing and distribution efficiency, and targeted returns on investments. Syn.: scientific inventory control. See: fixed reorder quantity inventory model.
730
statistical order point
Syn.: order point.
731
statistical order point system
Syn.: order point system.
732
statistical process control (SPC)
The application of statistical techniques to monitor and adjust an operation. This term often is used interchangeably with the term statistical quality control, although statistical quality control includes acceptance sampling as well as statistical process control.
733
statistical quality control (SQC)
The application of statistical techniques to control quality. The practice includes acceptance sampling as well as statistical process control. However, the term is often used interchangeably with the term statistical process control.
734
statistical safety stock calculations
The mathematical determination of safety stock quantities considering forecast errors, lot sizes, desired customer service levels, and the ratio of lead time to the length of the forecast period. Safety stock is frequently the product of the appropriate safety factor and the standard deviation or mean absolute deviation of the distribution of demand forecast errors.
735
statistical thinking
The ability to draw conclusions based on data.
736
statute of limitations
A statute restricting the length of time in which a lawsuit may be filed.
737
steady state
The state occurring when the variables that define the behavior of a system or process are behaving naturally as if operating for some time. In simulations, data is not collected until after this state is reached. See: transient state.
738
STEEPLED analysis
A strategic planning methodology that can be used across all business functions to discover, evaluate, organize, and track external risk. STEEPLED is an acronym for social, technological, economic, environmental, political, legislative, ethical, and demographic.
739
step budget
A budget that establishes the anticipated targets at which an operation will perform for each step or level of production. A step budget can be likened to several different fixed budgets. It is a useful budgeting method because most manufacturing overhead expenditures vary in steps, not as a straight line. See: flexible budget.
740
step-function scheduling
Scheduling logic that recognizes run length to be a multiple of the number of batches to be run rather than simply a linear relationship of run time to total production quantity.
741
stickering
Placing manufacturer- or customer-requested stickers on the boxes of the product being sent to them. This typically is done so that the customer, usually a retailer, can more effectively track its inventory. Barcoding is commonly a part of the stickering process.
742
stochastic models
Models in which uncertainty is explicitly considered in the analysis.
743
stock
1) Items in inventory. 2) Stored products or service parts ready for sale. These are different from stores, which are usually components or raw materials.
744
stock code
Syn.: item number.
745
stock dividend
A dividend paid to shareholders in stock rather than cash.
746
stock keeping unit (SKU)
A unique code that is used by warehouses, distribution centers, and retailers to identify and track inventory at a particular location. One product stocked at various locations may be represented by unique SKUs at each location. stock keeping unit (SKU) rationalization and cost of sales
747
analysis
An inventory-reduction practice that helps determine which SKUs can be terminated through a cost-of-sales analysis that reveals low sales.
748
stock number
Syn.: item number.
749
stock order
An order to replenish stock, as opposed to a production order to make a particular product for a specific customer.
750
stock record card
A ledger card that contains inventory status for a given item.
751
stock split
The issuance of new shares to stockholders without requiring additional equity.
752
stock status
A report showing the inventory on hand and usually showing the inventory on order and some sales or usage history for the products it covers.
753
stockchase
Syn.: expedite.
754
stockless production
Syn.: just in time (JIT).
755
stockless purchasing
Buying material, parts, supplies, and so on for direct use by the departments involved, as opposed to receiving them into stores and subsequently issuing them to the departments. The intent is to reduce inventory investment, increase cash flow, reduce materials handling and storage, and provide better service. See: dock-to-stock inventory.
756
stockout
A lack of materials, components, or finished goods that are needed. See: backorder.
757
stockout alert
A signal or notification of an item indicating a lack of inventory on hand that is required.
758
stockout costs
The costs associated with a stockout. Those costs may include lost sales, backorder costs, expediting, and additional manufacturing and purchasing costs.
759
stockout percentage
A measure of the effectiveness with which a company responds to actual demand or requirements. The stockout percentage can be a comparison of total orders containing a stockout with total orders or of line items incurring stockouts with total line items ordered during a period. One
760
formula is stockout percentage = (1
customer service ratio) × 100 percent. Ant.: customer service ratio.
761
stockout probability
The percentage chance of a product not being in stock when an order is placed. Syn.: cycle service level.
762
stockpoint
A designated location in an active area of operation into which material is placed and from which it is taken. This represents a way of tracking and controlling active material. The stockpoint is not necessarily a stockroom isolated from activity.
763
stocktaking via drones
Using drones to count the stock or inventory in a given location.
764
stop sequence
A loading procedure in which the first stop is loaded last.
765
stop work order
Syn.: hold order.
766
storage
The retention of parts or products for future use or shipment.
767
storage costs
A subset of inventory carrying costs, including the cost of warehouse utilities, material-handling personnel, equipment maintenance, building maintenance, and security personnel.
768
store
A storage point located upstream of a work station, intended to make it easier to see customer requirements.
769
stores
1) Stored materials used in making a product. 2) The room where stored components, parts, assemblies, tools, fixtures, and so forth are kept.
770
stores issue order
Syn.: picking list.
771
stores ledger card
A card on which records of the items on hand and on order are maintained.
772
stores requisition
Syn.: picking list.
773
stowability
The ease or difficulty of loading, handling, and storing shipping items. It is used as a factor for determining shipment costs and classifying freight. It considers regulations, liability, and item characteristics (e.g., hazardous materials, excessive weight, or irregular shape).
774
straight loading
A method for loading several pallets in a straight line all facing the direction of the pallet stringers.
775
straight-line depreciation
A method of depreciation whereby the amount to be recovered (written off as an expense) is spread uniformly over the estimated life of the asset in terms of time periods. See: depreciation.
776
straight-line schedule
Syn.: gapped schedule.
777
strategic alliance
A relationship formed by two or more organizations that share proprietary information, participate in joint investments, and develop linked and common processes to increase the performance of both companies. Many organizations form strategic alliances to increase the performance of their common supply chain.
778
strategic benchmarking
Benchmarking how others compete. This often involves benchmarking across industries. See: benchmarking.
779
strategic business unit (SBU)
An approach to strategic planning that develops a plan based on products. A company’s products are typically grouped into SBUs, with each SBU evaluated in terms of strengths and weaknesses vis-à-vis similar business units made and marketed by competitors. The units are evaluated in terms of their competitive strengths, relative advantages, life cycles, and cash flow patterns.
780
strategic deployment
See: hoshin planning.
781
strategic development
Continuously researching and analyzing the various available options for a particular process, and then selecting the most relevant option that aligns with the organization's strategic goals. See: strategic plan.
782
strategic drivers
Factors that influence business unit and manufacturing strategies.
783
strategic inventory positioning
The process of determining, for inventory in the supply chain or production processes, the location that will best protect the system against variability.
784
strategic mission
A statement of the future business scope of an enterprise. It incorporates what is being satisfied (customer needs), who is being satisfied (customer groups), and how the company creates value for the customer (processes, technologies, and core competencies).
785
strategic partnerships
Alliances with top supplier and buyer performers to enhance a firm’s performance.
786
strategic performance measurements
Measurements that relate to the long-term goals of a business. Examples include profitability, market share, growth, and productivity. See: global measurements, operational performance measurements.
787
strategic plan
A plan for how to marshal and determine actions to support the mission, goals, and objectives of an organization. A strategic plan generally includes an organization’s explicit mission, goals, and objectives as well as the specific actions needed to achieve those goals and objectives. See: business plan, operational plan(s), strategic planning, strategy, tactical plan(s).
788
strategic planning
The process of developing a strategic plan. See: operational planning, strategic plan, tactical planning.
789
strategic quality planning
Weaving quality considerations into strategic business plans.
790
strategic sourcing
A comprehensive approach for locating and sourcing key material suppliers, which often includes the business process of analyzing total-spend-for-material spend categories. The approach includes a focus on the development of long-term relationships with trading partners who can help the purchaser meet profitability and customer satisfaction goals. From an information technology applications perspective, it includes automation of requests for quotes, requests for proposals, electronic auctioning (e-auction or reverse auction), and contract management processes.
791
strategic variables
The most important variables that affect the business environment and business strategy. These typically include the economic situation, population demographics, changes in technology, and government policies.
792
strategy
For an enterprise, identifies how the company will function in its environment. The strategy specifies how to satisfy customers, how to grow the business, how to compete in its environment, how to manage the organization and develop capabilities within the business, and how to achieve financial objectives. See: strategic plan.
793
stratification analysis
A statistical tool for determining root causes in which observed historical data is separated by particular characteristics to determine the effect of each characteristic upon the observed results. See: root cause analysis.
794
street network
A system of interconnecting lines and points representing streets and roads for a specified area. It is used to find the best routes or to create a specified service area.
795
strict liability
A tort doctrine requiring those engaging in very hazardous activities or those manufacturing very hazardous items be held to a high standard of conduct.
796
strict performance
The performance of a contract good enough for the contractor to be paid full price less the other party’s losses.
797
structured problem-solving
A defined process applied to determine, evaluate, and resolve an identified problem. The methodology includes (1) collecting factual data, (2) defining why the situation is a problem, (3) composing a concise definition of what the problem is, (4) generating possible solutions, (5) evaluating the pros and cons of each option within the organization’s objectives and feasibility, and (6) implementing the solution selected.
798
subassembly
An assembly that is used at the next level of the bill of material to build another assembly.
799
subcontracting
Sending production work outside to another manufacturer. See: outsourcing.
800
subcontractor and supplier networks
Creating long-term contracts between a manufacturer and several suppliers of parts and components.
801
suboptimization
A solution to a problem that is best from a narrow point of view but not from a higher or overall company point of view. For example, a department manager who refuses to allow employees to work overtime in order to minimize the department’s operating expense may cause lost sales and a reduction in overall company profitability.
802
subplant
An organizational structure within a factory consisting of a compact entrepreneurial unit that is either process-oriented or product-oriented and is structured to achieve maximum productivity.
803
substitutability
When a buyer can purchase similar products from different suppliers. This increases the buyer’s power because the buyer doesn't have to rely on just one supplier.
804
substitution
The use of a nonprimary product or component, normally when the primary item is not available.
805
sub-tier supplier
A supplier who delivers a product to a direct supplier of the customer.
806
successor activity
1) In project management, in an activity- on-arrow network, the activity (arrow) that departs a node. 2) In project management, in an activity-on-node network, the activity at the tip of the arrow.
807
summary judgment
A judicial ruling that no essential facts are in dispute and that one party to the suit merits judgment as a matter of law.
808
sunk cost
1) The unrecovered balance of an investment. It is a cost, already paid, that is not relevant to the decision being made about the future. 2) Capital already invested that for some reason cannot be retrieved. 3) A past cost that has no relevance with respect to future receipts and disbursements of a facility undergoing an economic study. This concept implies that since a past outlay is the same regardless of the alternative selected, it should not influence the choice between alternatives.
809
super bill of material
A type of planning bill, located at the top level in the structure, that ties together various modular bills (and possibly a common parts bill) to define an entire product or product family. The quantity per relationship of the super bill to its modules represents the forecasted percentage of demand of each module. The master-scheduled quantities of the super bill explode to create requirements for the modules that also are master scheduled. See: pseudo bill of material.
810
superflush
A technique to relieve all components down to the lowest level using the complete bill of material, based on the count of finished units produced or transferred to finished goods inventory.
811
supermarket approach
A way of managing inventory and improving picking by making all parts easy to take off of a shelf, much like the shelves of a supermarket. Inventory is then restocked in such a way that employees always have easy access.
812
supervisor estimate
An estimate, made by a knowledgeable manager, of the labor required for an operation.
813
supplier
1) Provider of goods or services. See: vendor. 2) Seller with whom the buyer does business, as opposed to a vendor, which is a generic term referring to all sellers in the marketplace.
814
supplier alternate
A seller other than the primary one. The supplier alternate may or may not supply the items purchased but is usually approved to supply those items.
815
sum of deviations
For any collection of data points, this is the total sum of the difference between each point in the data and the average of all the data points.
816
summarized bill of material
A form of multilevel bill of material that lists all the parts and their quantities required in a given product structure. Unlike the indented bill of material, it does not list the levels of manufacture and lists a component only once for the total quantity used.
817
supplier appraisal
The practice of identifying suitable suppliers who can meet the planned requirements. Identification methods include conducting evaluation and appraisal questionnaires, desktop research, field research, supplier visits, supplier reference checks, and asking suppliers to complete a request for information to answer questions.
818
supplier audit
Auditing supplier processes as part of a supplier development system.
819
summarized where-used
A form of an indented where-used bill of material that shows all parents in which a given component is used, the required quantities, and all the next-level parents until the end-item is reached. Unlike the indented where-used, it does not list the levels of manufacture.
820
supplier base
The group of suppliers from which a firm acquires goods and services. Syn.: supply base.
821
supplier certification
Certification procedures verifying that a supplier operates, maintains, improves, and documents effective procedures that relate to the customer’s requirements. Such requirements can include cost, quality, delivery, flexibility, maintenance, safety, and ISO quality and environmental standards.
822
supplier clustering
Deliberately sole sourcing remote suppliers within a small geographical area to facilitate joint shipments of what would otherwise be less-than-truckload quantities.
823
supplier collaboration
A structured and effective relationship between buyers and suppliers that provides real-time visibility into transactions (including orders, invoices and credit memos) and monitors performance metrics to reduce risks, improve performance against contract terms, and achieve negotiated savings. See: supplier partnership.
824
supplier credit check
The practice of researching whether a supplier is financially stable in order to understand the supplier's financial solvency and bankruptcy risk. This can be accomplished through a credit check with a credit-rating agency, in which the agency collects information about the supplier from various resources and produces a score that reflects the financial stability of the supplier.
825
supplier debriefing
The practice of informing suppliers about the status of the tender awarding, whether the supplier is successful or not. These debriefings assure the procurement process is transparent and equitable and permits unsuccessful suppliers an opportunity to understand why their bid was not successful.
826
supplier development
Technical and financial assistance given to existing and potential suppliers to improve quality and/or due date performance.
827
supplier evaluation using robust evaluation tools
See: supplier performance evaluation.
828
supplier footprint
Describes the supply base for a particular material, component, or service. When stratified properly for leverage, cost impact, risk, and performance, the supply base can lead to a supplier footprint transition plan for consolidated leverage, supply-base reduction, and focused effort.
829
supplier lead time
The amount of time that normally elapses between the time an order is received by a supplier and the time the order is shipped. Syn.: vendor lead time. See: purchasing lead time.
830
supplier master data
Data that includes all relevant information about the goods and services being sourced from the suppliers, including supplier names, addresses, procurement history, supply categories, inventory data, contract records, purchasing records, and other key information about the supplier-business relationship. It may also include discounts, freight and delivery terms, currencies, payment terms, tolerances, and invoicing options for each supplier.
831
supplier measurement
The act of measuring the supplier’s performance to a contract. Measurements usually cover delivery reliability, lead time, and price. Syn.: purchasing performance measurement. See: vendor measurement.
832
supplier number
A numerical code used to distinguish one supplier from another.
833
supplier on-time delivery performance analysis
Tracking and analyzing the delivery performance of suppliers with regard to delivery when promised. It is important to ensure that there is no consistent early receipt of raw materials or late receipts.
834
supplier partner
A supplier organization with which a company has formed a customer-supplier partnership. See: outpartnering.
835
supplier partnership
The establishment of a working relationship with a supplier organization whereby two organizations act as one. Syn.: collaborative supply relationship.
836
supplier performance evaluation
Monitoring and evaluating key suppliers on cost, quality, engineering, purchasing, and so on, based on an agreed set of measurements.
837
supplier performance management
The process of evaluating, monitoring, and managing a supplier’s performance based on mutually defined criteria, such as reducing costs, on-time delivery, and managing risks. Syn.: supplier performance evaluation.
838
supplier quality assurance
The confidence that a supplier’s goods or services will fulfill its customers’ needs. This confidence is achieved by creating a relationship between the customer and supplier that ensures that the product will be fit for use with minimal corrective action and inspection. According to J.M. Juran, nine primary activities are needed: (1) define product and program quality requirements, (2) evaluate alternative suppliers, (3) select suppliers, (4) conduct joint quality planning, (5) cooperate with the supplier during the execution of the contract, (6) obtain proof of conformance to requirements, (7) certify qualified suppliers, (8) conduct quality improvement programs as required, and (9) create and use supplier quality ratings.
839
supplier registration process
The process of officially logging a supplier as a service or product provider after going through a verification process. The verification process can vary from a simple procedure of assuring that the supplier has a letter of incorporation and is licensed and registered to do business to a more complicated verification process requiring the prequalification of the supplier against a set of standards. The process systematically assures that suppliers can be issued a purchase order and that their payment can be processed through the enterprise resource planning system and payment portals.
840
supplier relationship management (SRM)
A comprehensive approach to managing an enterprise’s interactions with the organizations that supply the goods and services the enterprise uses. The goal of SRM is to streamline and make more effective the processes between an enterprise and its suppliers. SRM is often associated with automating procure-to-pay business processes, evaluating supplier performance, and exchanging information with suppliers. An e-procurement system is often an example of an SRM family of applications.
841
supplier relationship management (SRM) system
An enterprise software system used to implement and manage supplier relationships. See: supplier relationship management (SRM).
842
supplier research
Reviewing the performance data of a number of suppliers in an effort to identify suitable suppliers who are able to meet the planned requirements.
843
supplier scheduler
A person whose main job is working with suppliers regarding what is needed and when. This person is in direct contact with both material requirements planning and the suppliers and is responsible for doing the material planning for the items under their control, communicating the resultant schedules to their assigned suppliers, doing follow-up, resolving problems, and advising other planners and the master scheduler when purchased items will not arrive on time to support the schedule. Supplier schedulers are normally organized by commodity, as are the buyers. Using the supplier scheduler approach frees buyers from day-to-day order placement and expediting, giving them more time to do cost reduction, negotiation, supplier selection, alternate sourcing, and so forth. Syns.: planner/buyer, vendor scheduler.
844
supplier scheduling
A purchasing approach that provides suppliers with schedules rather than with individual hard-copy purchase orders. Normally, a supplier scheduling system will include a business agreement (contract) for each supplier, a weekly (or more frequent) schedule for each supplier extending for some time into the future, and individuals called supplier schedulers. Also required is a formal priority planning system that works well because it is essential in this arrangement to provide the supplier with valid due dates. Syn.: vendor scheduling.
845
supplier segmentation
A practice that organizes the relationship with suppliers by positioning them into different segments based on many parameters including transactional, preferred, strategic, or ownership relationship. Supplier segments range across a spectrum of buyer-supplier relationships such as traditional transactional suppliers, preferred suppliers, or strategic relationship suppliers.
846
supplier-input-process-output-customer (SIPOC) diagram
A high-level process map that shows substantial subprocesses in an organization’s process together with the structure of the process represented by the suppliers, inputs, outputs, and customers. A SIPOC diagram defines the critical aspects of a process without losing the overall perspective.
847
supplier-managed inventory
A relationship in which the buyer maintains inventory, usually at its facility, and provides the supplier information about the amount of stock on hand. It is the responsibility of the supplier to monitor this information and send replacement items when the inventory reaches a particular level.
848
supplier-owned inventory
A system in which the supplier not only controls the inventory but also owns it and keeps it close to the consumer until it is purchased by the consumer. This falls within the supplier managed inventory umbrella.
849
supplies
Materials used generally in manufacturing that are not normally charged to any one finished production. Examples include cutting and lubricating oils, machine repair parts, glue, or tape. Syns.: general stores, indirect materials.
850
supply
1) The quantity of goods available for use. 2) The actual or planned replenishment of a product or component. The replenishment quantities are created in response to a demand for the product or component or in anticipation of such a demand.
851
supply base
Syn.: supplier base.
852
supply base rationalization
The practice of analyzing the number of suppliers an organization uses to determine if it is the optimum number.
853
supply base rightsizing
A review of the suppliers in a category to determine the ideal number. Usually this involves finding categories with too many suppliers and reducing that number by awarding the business to fewer, more preferred suppliers.
854
supply chain
The network of suppliers that deliver products from raw materials to end customers through either an engineered or transactional flow of information, goods, and money.
855
supply chain community
The set of trading partners and nominal trading partners that define a complete supply chain.
856
supply chain continuity
An organization’s strategic and tactical capability to plan for and respond to conditions, situations, and events as necessary in order to continue supply chain operations at an acceptable predefined level.
857
supply chain control towers
A centralized hub that provides an integrated, complete view of data across the end-to-end supply chain. The system allows the supplier to see the requirements and inventory levels at the customer's site, enhances the ability to get accurate information about supply location and availability, and highlights any potential excess inventory. Similarly, it helps the customer easily identify supply and demand variations and take necessary actions to return excess inventory.
858
supply chain cycle time
The time it would take to fill a customer order if inventory levels were zero. It is the sum of the longest lead times for each stage in the supply chain. See: cycle time, cycle service level.
859
supply chain design
The determination of how to structure a supply chain. Design decisions include the selection of partners, the location and capacity of warehouse and production facilities, the products, the modes of transportation, and supporting information systems.
860
supply chain efficiency curve
A graph depicting the trade-off between supply chain cost and performance for efficient supply chains, which is useful in evaluating the efficiency of a current supply chain design and informing changes to make the current design more efficient.
861
supply chain event management (SCEM)
A term associated with supply chain management software applications, in which users have the ability to flag the occurrence of certain supply chain events to trigger some form of alert or action within another supply chain application. SCEM can be deployed to monitor supply chain business processes such as planning, transportation, logistics, or procurement. It can also be applied to supply chain business intelligence applications to alert users to any unplanned or unexpected events.
862
supply chain execution
Execution-oriented software applications for effective procurement and supply of goods and services across a supply chain. This includes manufacturing, warehouse, and transportation execution systems and systems providing visibility across the supply chain.
863
supply chain financing
A technology-based set of processes that link the buyer, seller, and financing institution to lower financing costs and improve business efficiency.
864
supply chain fixed assets
Those fixed assets associated with the costs to Orchestrate, Plan, Order, Source, Transform, Fulfill, and Return within the supply chain.
865
supply chain integration
When supply chain partners interact at all levels to maximize mutual benefit.
866
supply chain inventory visibility
Software applications that permit monitoring events across a supply chain. These systems track and trace inventory globally on a line-item level and notify the user of significant deviations from plans. Companies are provided with realistic estimates of when material will arrive.
867
supply chain management
The design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally.
868
supply chain management object synchronization
The ability to follow an object across a supply chain through its entire life cycle. The intent is to create visibility and improve control of a supply chain item from sales to cash and to enable systems integration and digitalization.
869
supply chain management (SCM) system
See: enterprise resource planning (ERP).
870
supply chain mapping
The identification of relationships between multiple layers of upstream and downstream supply chain participants to establish total visibility of the flow of materials, products, and information through the entire supply chain.
871
supply chain mastery
A firm’s ability to achieve superior results through exceptional management of revenue generation, segmented supplier and customer management, collaboration and information sharing, risk management, data analysis, and appropriate use of technology.
872
supply chain network
Trading partners within a supply chain that have established policies and structures regarding information, materials, and cash flows. In addition, they often have standards governing the flow of sourcing, operational, and logistical processes from raw materials to the end consumer. See: supply chain, supply chain network design systems.
873
supply chain network design systems
Systems created among all members of the supply chain in order to get all members on the same page and with the same goals in order to promote efficiency.
874
Supply Chain Operations Reference (SCOR) model
A process reference model developed by the Supply Chain Council and endorsed by the Association for Supply Chain Management (ASCM) as the standard cross-industry diagnostic tool for supply chain management. The SCOR model describes the business activities associated with satisfying a customer’s demand, which include Orchestrate, Plan, Source, Order, Transform, Fulfill, and Return. Use of the model includes analyzing the current state of a company’s processes and goals, quantifying operational performance, and comparing company performance to benchmark data. SCOR has developed a set of metrics for supply chain performance, and ASCM members have formed industry groups to collect best practices information that companies can use to evaluate their supply chain performance. Supply Chain Operations Reference Digital Standard (SCOR
875
DS)
A model that provides methodology, diagnostic, and benchmarking tools that help organizations make dramatic and rapid improvements in supply chain processes. SCOR DS is a part of the ASCM body of knowledge used to foster the advancement of end-to-end supply chain management.
876
supply chain optimization (SCO)
Using actual data or analyst projections, companies run multiple computer simulations to look for an optimal solution for business challenges, which enables top management to redesign the supply chain by as part of the enterprise`s overall strategy, typically in response to actual or anticipated changes in the marketplace.
877
supply chain planning
The determination of a set of policies and procedures that govern the operation of a supply chain. Planning includes the determination of marketing channels, promotions, respective quantities and timing, inventory and replenishment policies, and production policies. Planning establishes the parameters within which the supply chain will operate.
878
supply chain resilience
The ability of a supply chain to anticipate, create plans to avoid or mitigate, and/or to recover from disruptions to supply chain functionality. See: resilience.
879
supply chain revenue
Operating revenue generated from a supply chain not including non-operating revenue, such as leased real estate, investments, court settlements, or sales of office buildings.
880
supply chain risk
The variety of possible events and their outcomes that could have a negative effect on the flow of goods, services, funds, or information resulting in some level of quantitative or qualitative loss for the supply chain.
881
supply chain risk assessment
An assessment that determines where the greatest risks may exist in order to help company leaders prioritize resources for risk mitigation and management. Assessments involve clarifying the nature of a risk, understanding conditions that may lead to the event, knowing how frequently such events have happened or can be expected to happen, and the potential impact of such events.
882
supply chain risk management (SCRM)
The systematic identification, assessment, and mitigation of potential supply chain disruptions with the objective of reducing their negative impacts on the supply chain’s performance.
883
supply chain risk monitoring
A formal process to continuously observe the conditions related to a risk event to identify an increase in the probability of occurrence or impact.
884
supply chain strategy
An overarching plan for the design, planning, execution, control, and monitoring of supply chain activities. It is intended to guide efficient operations and initiatives that deliver on the desired key performance indicators and objectives. A supply chain strategy also specifies the function that is generally responsible for each supply chain activity as well as when collaboration among teams is needed, what needs to happen and when, and how performance will be measured.
885
supply chain stress testing
A rigorous analytical process of assessing plausible risks of all companies linked to a supply chain. With the objective of chain solvency now and in the future, analysis pertains to factors over which management has control, represented by a combination of financial ratios and models. Factors out of management control are forces of nature, like labor disruptions and war. Stress testing a supply chain involves quantitative methods that are fairly uniform and qualitative analysis that may vary from one situation to another.
886
supply chain visibility
Sharing information throughout the supply chain to create transparency among supply chain partners (e.g., the ability of supply chain partners to access demand and production information from trading partners).
887
supply market research
Research that enables the procurement team to understand how the supply market works, the direction it is going, the competitiveness, and the key suppliers within the supply market. The results of this analysis can help the buyer to improve and shape the strategy and tendering process and align their behavior in order achieve better value for money, reduced prices, or improved service.
888
supply network design
The capability to design and rationalize the supply network, optimizing for the required service level at the lowest total landed cost. This includes managing medium- and long-term capacity decisions based on strategic initiatives and financial plans while maintaining an agile supply network.
889
supply network planning (SNP)
Simulating and implementing comprehensive tactical planning and sourcing decisions based on a single, globally consistent model. The practice enables organizations to create a very close match between supply and demand by integrating purchasing, manufacturing, distribution, and transportation into one consistent model.
890
supply offset
Adjusting the timing of the application of a demand adjustment factor to account for fluctuations in demand or long lead time components. See: demand adjustment factor (DAF).
891
supply rate
Production rate, or quantity of units per unit of time, sent to inventory.
892
supply uncertainty
The risk of interruptions in the flow of components from upstream suppliers.
893
support costs
In activity-based cost accounting, activity costs not directly related to producing a product, such as the cost of the information system.
894
support functions
Activities such as accounting and information systems that do not directly participate in production but that are nevertheless essential.
895
Surface Transportation Board (STB)
An independent federal agency that is charged with the economic regulation of various modes of surface transportation, primarily freight rail. The STB does, however, regulate some aspects of motor carrier pricing.
896
surge capacity
The ability to meet sudden, unexpected increases in demand by expanding production with existing personnel and equipment.
897
surge tank
A container to hold output from one process and feed it to a subsequent process. It is used when line balancing is not possible or practical or only on a contingency basis when downstream equipment is nonoperational.
898
surplus
A situation in which an oversupply exists.
899
surrogate driver
In activity-based cost accounting, a substitute for the best possible driver that is useful because it is less costly and almost as accurate.
900
survey research
A form of research (frequently used in marketing research) in which data is collected by mailing questionnaires to a group of people within a target audience. See: marketing research.
901
sustainability
An organizational focus on activities that provide present benefit without compromising the needs of future generations.
902
sustainable procurement strategy
A process whereby organizations meet their needs for goods and services in a way that achieves value for the organization as well as society and the economy while minimizing damage to the environment.
903
sustainable supply chain management
Managing supply chain activities to make them more environmentally friendly.
904
sustaining activity
In activity-based cost accounting, an activity that is not directly beneficial to any specific cost object but does benefit the organization as a whole.
905
SV
Abbreviation for schedule variance.
906
swap body
A type of freight container that can be interchangeably transported by either road or rail.
907
Swiss Cheese Model
A framework used in risk management to characterize and mitigate risks in complicated environments such as supply chains. The Swiss Cheese Model views system failures as holes in a piece of cheese, and preventative measures and barriers against the risks as slices of cheese that limit the hole from going all the way through the piece of cheese and resulting in a total system failure such as a personal accident within a facility, a transportation accident, or a supply chain disruption.
908
SWOT
Acronym for strengths, weaknesses, opportunities, and threats.
909
SWOT analysis
An analysis of the strengths, weaknesses, opportunities, and threats of and to an organization. SWOT analysis is useful in developing strategy.
910
synchronization alerts
Alerts in demand-driven material requirements planning designed to highlight potential problems before they occur through expediting, rescheduling for components to coincide with parent item planned receipt, or adjusting item lead times.
911
synchronized planning
The capability that enables a business’s strategy via planning and operational levers across the entire value network. This capability integrates strategic goals, financial objectives, and tactical supply network plans to create a connected, concurrent, and synchronized business plan. The result is faster cross-functional decision-making, better information visibility, enhanced customer service, an agile supply network, real-time collaboration with business partners, efficient resource usage, and improved financial performance.
912
synchronized production
A manufacturing management philosophy that includes a consistent set of principles, procedures, and techniques in which every action is evaluated in terms of the global goal of the system. Both kanban, which is a part of the just-in-time philosophy, and drum-buffer- rope, which is a part of theory of constraints philosophy, represent synchronized production control approaches. Syn.: synchronous manufacturing. See: drum-buffer-rope (DBR), kanban, synchronous scheduling.
913
synchronous control
A pull-type production control system that is based on setting production rates and feeding work into production to meet the planned rates and then monitoring and controlling production.
914
synchronous manufacturing
Syn.: synchronized production.
915
synchronous scheduling
Scheduling processes (kanban in just in time and drum-buffer-rope in theory of constraints environments) that focus on synchronizing all operations to the constraint of the system. See: synchronized production.
916
synthetic time standard
Syn.: predetermined motion time.
917
system
A regularly interacting or interdependent group of items forming a unified whole toward the achievement of a goal.
918
system constraint
In supply chain management, the supply chain is viewed as the complete system. The system constraint is the resource at any one of the trading partners that is most limiting the end-to-end throughput of the supply chain.
919
system layout planning (SLP)
A facility layout methodology that develops the layout of a facility by considering the importance of proximity of each department to the other departments.
920
system nervousness
See: nervousness.
921
systems analysis
1) The analyzing in detail of the information needed for an organization, the characteristics and components of the current information system, and the requirements of any proposed changes to the information system. 2) A method of problem-solving that encompasses the identification, study, and evaluation of interdependent parts and their attributes that function in an ongoing process and that constitute an organic whole.
922
systems audit
The audit of any activity that can affect final product quality.
923
systems concept
An attempt to create the most effective complete system as opposed to the most efficient individual parts. A whole process or whole company operating system that is driven by cause and effect.
924
systems network
A group of interconnected nodes. This implies redundancy in connections and some means (e.g., machines) for implementing the connection.
925
systems rollup
Integrating computer systems. This enables faster data retrieval and better information system responsiveness.
926
systems thinking
A school of thought that focuses on recognizing the interconnections among the parts of a system and synthesizing them into a unified view of the whole.
927
systems view
A holistic approach to management that considers how actions impact the production process. Included within the system are suppliers, product design, process design, the production process, distribution, and customers.
928
tact time
Syn.: takt time.
929
tactical buying
The purchasing process focused on transactions and nonstrategic material buying. It is closely aligned with the ordering portion of executing the purchasing transaction process. Its characteristics include stable, limited fluctuations; defined standard specifications noncritical to production; no delivery issues; and high reliability concerning quality-standard material with very little concern for rejects. See: strategic sourcing.
930
tactical decision
The specific choice made about how to allocate resources and other specific steps and actions necessary to implement a tactical plan. See: tactical plan(s).
931
tactical plan(s)
The set of functional plans (e.g., production plan, sales plan, marketing plan) synchronizing activities across functions that specify production levels, capacity levels, staffing levels, funding levels, and so on for achieving the intermediate goals and objectives to support the organization’s strategic plan. See: aggregate planning, operational plan(s), production planning, sales and operations planning (S&OP), strategic plan, tactical planning.
932
tactical planning
The process of developing a set of tactical plans (e.g., production plan, sales plan, and marketing plan). Two approaches to tactical planning exist for linking tactical plans to strategic plans—production planning and sales and operations planning. See: operational planning, strategic planning, tactical plan(s).
933
Taguchi methodology
A concept of off-line quality control methods conducted at the product and process design stages in the product development cycle. This concept, expressed by Genichi Taguchi, encompasses three phases of product design: system design, parameter design, and tolerance design. The goal is to reduce quality loss by reducing the variability of the product’s characteristics during the parameter phase of product development. Syn.: Taguchi methods.
934
Taguchi methods
Syn.: Taguchi methodology.
935
takt time
Sets the pace of production to match the rate of customer demand and becomes the heartbeat of any lean production system. It is computed as the available production time divided by the rate of customer demand. For example, assume demand is 10,000 units per month, or 500 units per day, and planned available capacity is 420 minutes per day. The takt time = 420 minutes per day ÷ 500 units per day = 0.84 minutes per unit. This takt time means that a unit should be planned to exit the production system on average every 0.84 minutes. Syn.: tact time.
936
tampering
Action taken to compensate for variation within the control limits of a stable system. Tampering increases rather than decreases variation, as evidenced in the funnel experiment. See: funnel experiment.
937
tangibles
1) Things that can be quantitatively measured or valued, such as the costs of physical assets. 2) A dimension of service quality referring to the physical appearance of the service facility, including the personnel and equipment.
938
tank car
A freight car with no top, a flat bottom, and fixed sides. It is used primarily for hauling bulk commodities.
939
tank inventory
Goods stored in tanks. These goods may be raw materials, intermediates, or finished goods. The description of inventory as tank inventory indicates the necessity of calculating the quantity on hand from the levels within the tanks.
940
tanker
Syn.: Tanker vessel.
941
tanker vessel
Ships of various sizes and capacities that transport liquefied freight. Syn.: tanker.
942
tapering rate
A rate structure in which a shipping rate increases as the distance shipped increases, but the increases are not directly correlated to the increase in the distance shipped.
943
tardiness
For jobs that are late, the delivery date minus the due date. See: earliness, lateness.
944
tare weight
The weight of an empty container, obtained by deducting the net weight of the contents of the container from the gross weight of the full container.
945
target costing
The process of designing a product to meet a specific cost objective. Target costing involves setting the planned selling price and subtracting the desired profit as well as marketing and distribution costs, thus leaving the required manufacturing or target cost.
946
target inventory level
In a min-max inventory system, the equivalent of the maximum. The target inventory is equal to the order point plus a variable order quantity. This is often called an order-up-to inventory level and is used in a periodic review system. Syn.: order-up-to level.
947
target market
1) A fairly homogeneous group of customers to whom a company wishes to appeal. 2) A definable group of buyers to which a marketer has decided to market.
948
target marketing
The process of focusing marketing activities specifically on those people who are most likely to buy a company’s products and services. Data gathered about people who use the internet enables companies to identify and focus on more likely candidates.
949
tariff
An official schedule of taxes and fees imposed by a country on imports or exports.
950
task
1) In project management, the lowest level to which work can be subdivided on a project. 2) In activity-based cost accounting, a task, a subdivision of an activity, is the least amount of work. Tasks are used to describe activities.
951
task interleaving
An attempt at reducing or eliminating deadheading (i.e., driving an empty materials-handling vehicle). A warehouse management system directs a materials- carrying vehicle to put away materials as it goes to pick up other materials.
952
task management
The practice of determining the resources and sequence of tasks necessary to carry out delivery processes, including aggregation and staging of products for shipment.
953
TBC
Abbreviation for time-based competition.
954
TBL
Acronym for triple bottom line.
955
TCO
Acronym for total cost of ownership.
956
TCP/IP
Acronym for transmission control protocol/internet protocol.
957
team design/engineering
Syn.: participative design/engineering.
958
teardown
All work items required between the end of one operation or job and the start of setup for the next operation or job, with both jobs requiring the same machinery or facilities. See: teardown time.
959
teardown bill of material
Syn.: disassembly bill of material.
960
teardown time
The time needed to remove a setup from a machine or facility. Teardown is an element of manufacturing lead time, but it is often allowed for in setup or run time rather than separately. See: teardown.
961
technical components
Parts that are difficult to make, have long lead times, and require expert knowledge to produce. These generally are produced by only a few suppliers because of these characteristics. Tooling to produce these products usually is owned by the customer to avoid proprietary or patent issues.
962
technical/office protocol (TOP)
An application-specific protocol based on open systems interconnection (OSI) standards. The protocol is designed to allow communication between computers from different suppliers in the technical development and office environments.
963
technologies
The terms, concepts, philosophies, hardware, software, and other attributes used in a field, industrial sector, or business function.
964
technology transfer
The transmission of technology (e.g., knowledge, skills, software, and hardware) from one country, organization, business, or entity to another country, organization, business, or entity.
965
TEI
Acronym for total employee involvement.
966
telecommunications
Transmission of voice and image data at a distance by electronic means.
967
telescoping
Syn.: overlapped schedule.
968
tender offer
An offer by an organization to buy a block of shares directly from shareholders of another organization.
969
terminal delivery allowance
A discount provided if freight is delivered to or picked up from the carrier’s terminal.
970
terminal value
The value of an operation or entity at the end of the period considered.
971
terminal-handling charges
1) Carrier charges dependent on the number of times a shipment must be loaded, handled, and unloaded. Cost can be reduced by consolidating shipments into fewer parcels or by shipping in truckload quantities. 2) For shipping lines, the costs of paying container terminals for unloading and loading during shipment. These costs are borne by the shipping lines at the port of shipment or destination.
972
terminals
In transportation, locations where carriers load and unload goods to and from vehicles. They also are used to make connections between local pickup and delivery services and line-haul services. Functions performed in terminals include weighing connections with other routes and carriers, vehicle routing, dispatching, maintenance, paperwork, and administration. Terminals may be owned and operated by the carrier or the public.
973
terms and conditions
All the provisions and agreements of a contract.
974
terms of sale
In international trade, the element of a contract that states the delivery and payment terms between a buyer and a seller. It includes when and where the transfer of goods will occur, documentation that is required, and liabilities for both parties while the goods are in transit.
975
terms of trade
The portion of a contract of sale that specifies the responsibilities of the seller or exporter and the responsibilities of the buyer or importer, especially the point at which one party’s responsibilities end and the other party’s responsibilities begin (including the point at which title to the goods is transferred). These terms are commonly specified using International Commercial Terms (Incoterms®).
976
TEU
Abbreviation for twenty-foot equivalent unit.
977
the in-country value
A sustainable practice that aims to boost economic performance and support local industries by redirecting higher portions of spending into the national economy where the products are sold. This often means that, in the solicitation process, local suppliers are given preference over international suppliers by assigning a higher value to local suppliers in the comparison and awarding process. This does not necessarily mean always awarding work to local suppliers but rather emphasizing the empowerment of national suppliers to create job opportunities and growth in the country's gross domestic product.
978
theoretical capacity
The maximum output capability, allowing no adjustments for preventive maintenance, unplanned downtime, shutdown, and so forth.
979
theoretical cycle time
The amount of time, eliminating all stops, waiting, and additional time due to error, that is needed for one item to go through an entire process.
980
theory of constraints (TOC)
A holistic management philosophy developed by Dr. Eliyahu M. Goldratt based on the principle that complex systems exhibit inherent simplicity. Even a very complex system comprising thousands of people and pieces of equipment can have, at any given time, only a very, very small number of variables—perhaps only one, known as a constraint—that actually limit the ability to generate more of the system’s goal.
981
theory of constraints (TOC) accounting
A cost and managerial accounting system that accumulates costs and revenues into three areas—throughput, inventory, and operating expense. It does not create incentives (through allocation of overhead) to build up inventory. This accounting method is considered to provide a truer reflection of actual revenues and costs than traditional cost accounting and is closer to a cash flow concept of income than traditional accounting is. TOC accounting provides a simplified and more accurate form of direct costing that subtracts true variable costs (those costs that vary with throughput quantity). Unlike traditional cost accounting systems in which the focus is generally placed on reducing costs in all the various accounts, the primary focus of TOC accounting is on aggressively exploiting the constraint(s) to make more money for the firm. Syns.: constraint accounting, throughput accounting.
982
therbligs
The 17 basic movements identified by Frank and Lillian Gilbreth. (The name of the term is essentially Gilbreth spelled backwards.) Examples of movements include grasp, move, release, select, and position. See: predetermined time standards.
983
third-order smoothing
Syn.: triple smoothing.
984
third-party logistics (3PL)
A buyer and supplier team with a third party that provides product delivery services. This third party may provide added supply chain expertise.
985
third-party logistics company
A company that manages all or part of another company’s product delivery operations.
986
third-party registration system
Using an outside party (rather than the buyer) to determine the adequacy of a seller’s product quality. If several buyers use the same third-party system, such as ISO 9000, the seller avoids having multiple audits.
987
third-party transportation services
Outside firms providing transportation of goods.
988
third-party warehousing
The outsourcing of the warehousing function by the seller of the goods.
989
Thomas Register or ThomasNet®
A privately produced reference set that includes a listing of part suppliers by product type and geographic area.
990
threatcasting
A multidisciplinary approach to develop models of various potential futures, with the goal of anticipating when, where, and how potential threats might occur. The intent is to develop methods for detecting the evolution of threats, thus reducing their risk of occurrence, diminishing their impact, or speeding up recovery from them.
991
three-bin kanban
A simple kanban structure that focuses on cycling three bins of material continually and provides a visible method to align replenishment with consumption. One bin is ready to ship from the supplier at all times, while two are back to back in manufacturing or production at or near the point of use. As the front bin empties, a signal is sent to the supplier to send a full bin, and the back bin is issued forward into production. See: kanban.
992
three-point estimate
A project management technique that uses three cost or duration estimates to stand for the optimistic (O), most likely (M), and pessimistic (P) situations. The mean value (MV) is often found using MV = (O + 4M + P) ÷ 6. This technique can improve the accuracy of cost or duration estimates when underlying assumptions are uncertain.
993
threshold costs
A company’s variable costs, which must be covered for a company to continue to stay in business.
994
throughput
1) The rate at which the system generates goal units. Because throughput is a rate, it is always expressed for a given time period, such as per month, week, day, or even minute. If the goal units are money, throughput is an amount of money per time period. In that case, throughput is calculated as revenues received minus total variable costs and then divided by units of the chosen time period. 2) In warehousing, it represents the number of goods that are moving through the warehouse at any given moment.
995
throughput accounting
A management accounting method based on the belief that because every system has a constraint that limits global performance, the most effective way to evaluate the impact that any proposed action will have on the system as a whole is to look at the expected changes in the global measures of throughput, inventory, and operating expense.
996
throughput time
See: cycle time.
997
tier one
The group of suppliers that is directly responsible for not only product supply but product development.
998
tiered workforce
A strategy used to vary workforce levels in which additional full-time or part-time employees are hired during peak demand periods while a smaller permanent staff is maintained year-round. This technique is used heavily in perishable seasonal goods industries (e.g., chocolate production or nursery plants).
999
tiger teams
Teams that attempt to achieve a specific goal within a short time period.
1000
time and attendance
A collection of data relating to an employee’s record of absences and hours worked.
1001
time and materials (T&M) contract
A type of contract that is a hybrid between cost-reimbursable and fixed-time contracts.
1002
time bucket
A number of days of data summarized into a columnar or row-wise display. For example, a weekly time bucket contains all the relevant data for an entire week. Weekly time buckets are considered to be the largest possible (at least in the near and medium term) to permit effective material requirements planning.
1003
time buffer
Protection against uncertainty that takes the form of time.
1004
time card
A document recording attendance time, often used for indicating the number of hours for which wages are to be paid. Syn.: clock card.
1005
time fence
A policy or guideline established to note where various restrictions or changes in operating procedures take place. For example, changes to the master production schedule can be accomplished easily beyond the cumulative lead time, while changes inside the cumulative lead time become increasingly more difficult to a point where changes should be resisted. Time fences can be used to define these points. See: demand time fence (DTF), hedge, planning time fence.
1006
time period safety stock
A safety stock that is based on usage over a designated time frame. The period can be set as days, weeks, or months. Safety stock varies directly with demand. This differs from statistical-based safety stocks in that the amount is not based on deviation from demand.
1007
time phasing
The technique of expressing future demand, supply, and inventories by time period. Time phasing is one of the key elements of material requirements planning.
1008
time series
A set of data that is distributed over time, such as demand data in monthly time periods. Various patterns of demand—seasonal, trend, cyclical, and random—must be considered in time series analysis.
1009
time series analysis
Analysis of any variable classified by time in which the values of the variable are functions of the time periods. Time series analysis is used in forecasting. A time series consists of seasonal, cyclical, trend, and random components. See: cyclical component, random component, seasonal component, trend component.
1010
time series forecasting
A forecasting method that projects historical data patterns into the future. It involves the assumption that the near-term future will be like the recent past.
1011
time stamping
Tracking with each transaction the time of occurrence. This is used in period closings and to tie end-items to samples for certification of item properties.
1012
time standard
The predetermined times allowed for the performance of a specific job. It often consists of two parts, one for machine setup and one for actual running. A time standard can be developed through observation of the actual work (time study), summation of standard micromotion times (predetermined or synthetic time standards), or approximation (historical job times).
1013
time study
Timing employees as they accomplish jobs for the purpose of setting time standards.
1014
time ticket
An operator-entered labor claim. Syn.: job ticket.
1015
time to recovery (TTR)
The aggregate amount of time it would take a supply chain network point to become fully functional after a disruption. The total time to recover includes the amount of time required to combine suppliers’ time to recovery information with the primary organization’s own data to identify risk exposure for each of the network sites.
1016
time to reliably replenish (TRR)
The time in which a part can reliably be obtained if necessary.
1017
time utility
When a delivery gets to a customer at exactly the right time (not early or late).
1018
time value of money
The difference in the valuation of an amount of funds at the present time and the value of that same amount of funds at a future time based on the earning power of investing the same funds at the present time at the prevailing interest rate or required rate of return. See: present value, net present value (NPV).
1019
time-based competition (TBC)
A broad-based corporate strategy that emphasizes time as the vehicle for achieving and maintaining a sustainable competitive edge. Its characteristics are as follows: (1) It deals only with those lead times that are important to the customers, (2) the lead-time reductions must involve decreases in both the mean and the variance, and (3) the lead-time reductions must be achieved through system or process analysis (the processes must be changed to reduce lead times). Reductions in lead times are achieved by changing the processes and the decision structures used to design, produce, and deliver products to the customers. TBC involves design, manufacturing, and logistical processes.
1020
time-based order system
Syn.: fixed reorder cycle inventory model.
1021
time-definite services
Delivery of goods and services when an agreement has been reached on the day and time of the delivery.
1022
time-now date
Syn.: data date.
1023
time-phased order point (TPOP)
A material requirements
1024
planning (MRP)
like time planning logic technique for independent demand items in which gross requirements come from a forecast, not via explosion. This method can be used to plan distribution center inventories as well as to plan for service (repair) parts because MRP logic can readily handle items with dependent demand, independent demand, or a combination of both. It is an approach that uses time periods, thus allowing for lumpy withdrawals instead of average demand. When used in distribution environments, the planned order releases are input into the master schedule dependent demand requirements. See: fixed reorder quantity inventory model.
1025
times interest earned
Ratio of profits before payment of interest and income taxes to interest on debt.
1026
timetables
Schedules that are organized by starting location or destination and show the times for departures and arrivals.
1027
time-to-market
The total time required to design, build, and deliver a product (timed from concept to delivery). See: procurement lead time.
1028
time-to-product
The total time required to receive, fill, and deliver an order for an existing product to a customer, timed from the moment that the customer places the order until the customer receives the product. See: purchasing lead time.
1029
tipping point
The moment when something unique becomes common. The term often refers to the popular acceptance of new technologies. The concept has been applied to any process in which, beyond a certain point, the rate at which the process (chemical, sociological, environmental, etc.) proceeds increases dramatically.
1030
TL
Abbreviation for truckload.
1031
TMS
Acronym for transportation management system.
1032
TOC
Acronym for theory of constraints.
1033
TOC performance measures
In theory of constraints, throughput, inventory, and operating expense are considered performance measures that link operational decisions to organizational profit.
1034
TOFC
Acronym for trailer on a flatcar.
1035
tolerance
Allowable departure from a nominal value established by design engineers that is deemed acceptable for the functioning of the good or service over its life cycle.
1036
tolerance limits
1) The upper and lower extreme values permitted by the tolerance. 2) In work measurement, the limits between which a specified operation time value or other work unit will be expected to vary. See: lower specification limit (LSL), upper specification limit (USL). Syn.: specification limits.
1037
tolerance stack up
When two or more components—all within tolerance limits but at some distance from the specification itself—are assembled together, causing the assembly potentially to be subject to early failure because of the interactions among the components.
1038
ton-mile
A way to measure the transportation of freight. It is the multiplication of weight being transported (in tons) by the distance it is being transported (in miles). It is heavily used in rail and ship transportation mode.
1039
tool calibration frequency
The recommended length of time between tool calibrations. It is normally expressed in days.
1040
tool issue order
Syn.: tool order.
1041
tool number
The identification number assigned to reference and control a specific tool.
1042
tool order
A document authorizing issue of specific tools from the tool crib or other storage. Syn.: tool issue order.
1043
TOP
Abbreviation for technical/office protocol.
1044
top management commitment (quality)
In the total quality management philosophy, participation of the highest-level official in the organization’s quality improvement efforts. Participation includes establishing and serving on a quality committee, establishing quality policies and goals, deploying those goals to lower levels of the organization, providing the resources and training that the lower levels need to achieve the goals, participating in quality improvement teams, reviewing organization-wide progress, recognizing those who have performed well, and revising the current reward system to reflect the importance of achieving the quality goals.
1045
total annual material receipts
The amount (in dollars) of all direct materials that were received in a calendar year. This number should fall very close to the direct material dollars that were used in a calendar year in a lean environment.
1046
total cost analysis
In purchasing, a process by which a firm seeks to identify and quantify all of the major costs associated with various sourcing options.
1047
total cost concept
In logistics, the idea that all logistical decisions that provide equal service levels should favor the option that minimizes the total of all logistical costs and should not be used on cost reductions in one area (such as lower transportation charges) alone.
1048
total cost consideration
Considering all cost impacts, rather than just one cost impact, on customer service improvement.
1049
total cost curve
1) In cost-volume-profit (breakeven) analysis, the total cost curve is composed of total fixed and variable costs per unit multiplied by the number of units provided. Breakeven quantity occurs where the total cost curve and total sales revenue curve intersect. See: break-even chart, break- even point. 2) In inventory theory, the total cost curve for an inventory item is the sum of the costs of acquiring and carrying the item. See: economic order quantity (EOQ).
1050
total cost of ownership (TCO)
In supply chain management, the total cost of ownership of the supply delivery system is the sum of all the costs associated with every activity of the supply stream. The main insight that TCO offers to the supply chain manager is the understanding that the acquisition cost is often a very small portion of the total cost of ownership.
1051
total cost of quality
A sum that includes costs associated with rework, scrap, warranty costs, and other costs associated with preventing or resolving quality problems.
1052
total cost of quality curve
A curve that suggests there is some optimal quality level, denoted as Q*. The curve is calculated by adding costs of internal and external failures, prevention costs, and appraisal costs. The optimal quality level occurs when this curve reaches a minimum point. It is a single turning point curve that always has a minimum.
1053
total cost to serve
The sum of the supply chain cost to deliver products and services to customers. It includes the cost to plan the supply chain; source materials, products, goods, merchandise, and services; produce, manufacture, remanufacture, refurbish, repair, and maintain goods and services; manage orders, customer inquiries, and returns; and deliver products and services at the agreed location (point of revenue). It comprises both direct cost and indirect cost.
1054
total costs
Considering all cost impacts, rather than just one cost impact, on customer service improvement.
1055
total cumulative manufacturing cycle time
Average time between a part entering a manufacturing system and completion of final packaging.
1056
total employee involvement (TEI)
An empowerment program in which employees are invited to participate in actions and decision-making that were traditionally reserved for management.
1057
total factor productivity
A measure of productivity (of a department, plant, strategic business unit, firm, etc.) that combines the individual productivities of all its resources, including labor, capital, energy, material, and equipment. These individual factor productivities are often combined by weighting each according to its monetary value and then adding them. For example, if material accounts for 40 percent of the total cost of sales, labor 10 percent of the total cost of sales, and other resources 60 percent, total factor productivity = .4 (material productivity) + .1 (labor productivity) + .6 (other resource productivity).
1058
total fixed costs
Costs that remain constant in total, regardless of changes in activity.
1059
total float
In project management, the length of time an activity can be late without delaying succeeding activities. See: float, free float, independent float.
1060
total lead time
Syn.: lead time.
1061
total line-haul cost
Basic costs of carrier operation to move a container of freight, including drivers’ wages and usage depreciation, which vary with the distance shipped and the cost per mile.
1062
total make cycle time
Average cumulative processing time between a part entering a manufacturing system and completion of manufacturing activities (not including packaging).
1063
total operations synchronization
The ability to continuously schedule and allocate scarce resources to optimally execute production and operational activities based on operations command center insights to increase visibility and coordination of machines, people and processes across the network ecosystem. See: operations command center.
1064
total preventive maintenance
Syn.: total productive maintenance (TPM).
1065
total procurement lead time
Syn.: procurement lead time.
1066
total productive maintenance (TPM)
Preventive maintenance plus continuing efforts to adapt, modify, and refine equipment to increase flexibility; reduce materials handling; and promote continuous flows. It is operator-oriented maintenance with the involvement of all qualified employees in all maintenance activities. Syn.: total preventive maintenance.
1067
total quality control (TQC)
The process of creating and producing the total composite good and service characteristics (by marketing, engineering, manufacturing, purchasing, etc.) through which the good and service will meet the expectations of customers.
1068
total quality engineering (TQE)
The discipline of designing quality into the product and manufacturing processes by understanding the needs of the customer and performance capabilities of the equipment. See: design for quality.
1069
total quality management (TQM)
A term coined to describe Japanese-style management approaches to quality improvement. Since then, TQM has taken on many meanings. Simply put, TQM is a management approach to long-term success through customer satisfaction. TQM is based on the participation of all members of an organization in improving processes, goods, services, and the culture in which they work. The methods for implementing this approach are found in teachings of such quality leaders as Philip B. Crosby, W. Edwards Deming, Armand V. Feigenbaum, Kaoru Ishikawa, J.M. Juran, and Genichi Taguchi.
1070
total supply chain management cost
The total cost to manage order processing, acquire materials, manage inventory, and manage supply chain finance, planning and information technology (IT) costs, as represented as a percentage of revenue. It is calculated as: (Order Management Costs + Material Acquisition Costs + Inventory Carrying Costs + Supply
1071
Chain
related Finance and Planning Costs + Total Supply
1072
Chain
related IT Costs) ÷ Total Product Revenue.
1073
total value analysis
A method of economic analysis in which a model expresses the dependent variable of interest as a function of independent variables, some of which are controllable.
1074
total variable costs
Costs that vary in total in proportion to changes in activity.
1075
total waste management (TWM)
A methodology that enables finding solutions to waste issues while keeping in mind financial elements and the business case.
1076
touch labor
Syn.: direct labor.
1077
touches
A statistic that is used to determine efficiency for costing or pricing functions. A touch occurs anytime a labor activity is utilized during the manufacturing or service-creation process. This concept has generated the term touch labor for direct labor personnel.
1078
Toyota Production System (TPS)
A manufacturing methodology developed at Toyota Motor Corporation that has evolved into the concepts of just in time and lean manufacturing.
1079
TPM
Acronym for total productive maintenance.
1080
TPOP
Abbreviation for time-phased order point.
1081
TPS
Acronym for Toyota Production System.
1082
TQC
Acronym for total quality control.
1083
TQE
Acronym for total quality engineering.
1084
TQM
Acronym for total quality management.
1085
traceability
1) The attribute allowing the ongoing location of a shipment to be determined. 2) The registering and tracking of parts, processes, and materials used in production, by lot or serial number.
1086
tracer
A request to a transportation line to trace a shipment to expedite its movement or to verify delivery.
1087
tracing
In activity-based cost accounting, connecting resources to activities to cost objects using underlying causal drivers to understand how costs occur during normal business activities.
1088
tracking
The process of determining and reporting the location of a shipment throughout the supply chain channel.
1089
tracking capacity strategy
Adding capacity in small amounts to attempt to respond to changing demand in real time in the marketplace. This approach may satisfy total demand and help minimize unit costs, but it can be difficult in some situations to add incremental amounts of capacity, especially if the facility has no more space available.
1090
tracking signal
The ratio of the cumulative algebraic sum of the deviations between the forecasts and the actual values to the mean absolute deviation. It is used to signal when the validity of the forecasting model might be in doubt. See: forecast error, mean absolute deviation (MAD).
1091
trade bloc
An agreement between or among countries intended to reduce or remove barriers to trade within member countries. Frequently, but not always, those countries are geographically close. Examples of trade blocs are the European Economic Community and the North American Free Trade Agreement (NAFTA). Syn.: trading bloc.
1092
trade secret
Knowledge about a manufacturing process that gives the owner an advantage over competitors who do not have it. Trade secrets are legally protectable.
1093
trading bloc
Syn.: trade bloc.
1094
trading company
A company that introduces foreign buyers and sellers and arranges all product export and import details, documentation, and transportation.
1095
trading partner
Any organization external to the firm that plays an integral role within the supply chain community and whose business fortune depends on the success of the supply chain community.
1096
trading partner agreement
A contract between trading partners that describes all facets of their business together. It is a legal and binding agreement suitable for legal purposes as well as standard working agreements.
1097
traffic
A department or function charged with the responsibility for arranging the most economic classification and method of shipment for both incoming and outgoing materials and products.
1098
traffic department
The area of an organization that plans and executes shipping requirements.
1099
traffic management
Control of transportation carriers, modes, and services.
1100
trailer on a flatcar (TOFC)
A specialized form of containerization in which motor and rail transport coordinate. Syn.: piggyback.
1101
transactions
Individual events reported to the system (e.g., issues, receipts, transfers, or adjustments).
1102
transfer batch
The quantity of an item moved between sequential work centers during production. See: batch, overlap quantity.
1103
transfer price
Price that one segment (subunit, department, division, etc.) of an organization charges for a good or service supplied to another segment of the same organization.
1104
transfer pricing
The pricing of goods or services transferred from one segment of a business to another. See: interplant transfer.
1105
transform
The process that describes the activities associated with the scheduling and creation of products (e.g., production; assembly and disassembly; and maintenance, repair, and operating) and services. The Supply Chain Operations Reference (SCOR) Transform process is generic so as to cover all types of material conversion and can be applied to make-to- stock, make-to-order, and engineer-to-order environments.
1106
transformation process
The process of converting inputs into finished goods or services. In a service firm, the input may be a customer. Syn.: transformation system. See: manufacturing process, production process.
1107
transformation system
Syn.: transformation process.
1108
transient bill of material
Syn.: phantom bill of material.
1109
transient state
When the variables in a system or process have changed but not reached steady state yet. Data is usually not collected from the model until less erratic behavior emerges. See: steady state.
1110
transit inventory
Inventory moved from one location to another. See: transportation inventory.
1111
transit privilege
A service provided by a shipper that allows the purchasing company to stop a shipment mid-route to allow changes to the delivery but to pay the nonstop rate.
1112
transit time
A standard allowance that is assumed on any given order for the movement of items from one operation to the next. Syn.: travel time.
1113
transition tree (TRT)
In theory of constraints, a logic-based tool for identifying and sequencing actions in accomplishing an objective. The transitions represent the states or stages in moving from the present situation to the desired objective.
1114
translation software
Software that converts business data into an electronic data interchange standard format and vice versa.
1115
training aid
An item to enhance training, usually minor in nature. Training aids may include charts, graphs, slides, and schematics.
1116
transmission acknowledgement
When the receiver of a transmission notifies the sender that the transmission was received error-free.
1117
transaction channel
A distribution network that deals with change of ownership of goods and services including the activities of negotiation, selling, and contracting.
1118
transmission control protocol/internet protocol (TCP/IP)
The communication protocol used by the internet.
1119
transparency
When a company allows outsiders, typically customers, to see some internal information (typically regarding an order) without giving any more than the outsider requires.
1120
transport stocks
A carrier material designed to move solids in solution or slurry or to dilute ingredients to safe levels for reaction.
1121
transportation
The function of planning, scheduling, and controlling activities related to mode, vendor, and movement of inventories into and out of an organization.
1122
transportation brokers
Firms that find shipments for carriers for a fee.
1123
transportation cycle time
A logistics performance measure of the lead time required for a product to reach its final destination. It is the time between leaving a warehouse and arriving at the destination.
1124
transportation requirements planning (TRP)
Using existing material requirements planning, distribution requirements planning, or enterprise resource planning databases to plan transportation requirements based on actual demand.
1125
travel time
Syn.: transit time.
1126
traveler
A copy of the manufacturing order that actually moves with the work through the shop. Syn.: shop traveler.
1127
traveling purchase requisition
A purchase requisition designed for repetitive use. After a purchase order has been prepared for the goods requisitioned, the form is returned to the originator, who holds it until a repurchase of the goods is required. The name is derived from the repetitive travel between the originating and purchasing departments. Syn.: traveling requisition.
1128
traveling requisition
Syn.: traveling purchase requisition.
1129
transportation inventory
Inventory that is in transit between locations. See: pipeline stock, transit inventory.
1130
treasury stock
Common stock that has been repurchased by the issuing company.
1131
transportation legal classifications
Legal regulatory classification of transportation by product, shipping size, rates, carriers, and types of services.
1132
transportation management
The process of executing requirements for the planning, scheduling, and budgeting of transportation assets, services, and related systems of the shipping process through delivery.
1133
transportation management outsourcing
The practice of contracting with another company to provide transportation management services.
1134
transportation management software
Software that is used to keep track of large volumes of shipments on a daily basis.
1135
transportation management system (TMS)
A computer application system designed to manage transportation operations. This type of application typically includes modules focused on specific functions, such as intermodal transportation, import and export management, fleet service management, and load planning and optimization.
1136
transportation method
A linear programming model concerned with minimizing the costs involved in supplying requirements to several locations from several sources with different costs related to the various combinations of source and requirement locations.
1137
transportation mode
The manner in which an item is transported.
1138
tree diagram
1) A management technique used to analyze a situation in increasing detail. The full range of tasks to be accomplished to achieve a primary goal and supporting subgoal may be illustrated. 2) In theory of constraints, a diagram relating effects to underlying causes. See: current reality tree (CRT), future reality tree (FRT).
1139
trend
General upward or downward movement of a variable over time (e.g., demand or process attribute).
1140
trend analysis
An analysis to determine whether a trend (general upward or downward change) exists in data. See: trend forecasting models.
1141
trend component
A component of demand, usually describing the impact of increasing or decreasing growth on demand. See: time series analysis.
1142
trend control chart
A control chart in which the deviation of the subgroup average (X-bar) from an expected trend in the process level is used to evaluate the stability of a process.
1143
trend forecasting models
Methods for forecasting sales data when a definite upward or downward pattern exists. Models include double exponential smoothing, regression, and triple smoothing. See: trend analysis.
1144
trend-adjusted exponential smoothing forecasting
A form of exponential smoothing forecasting that includes a factor for increasing or decreasing trends in the data resulting from variables such as population growth or income changes.
1145
transportation optimization
Evaluating the potential to change inbound or outbound transportation modes to better match supply and demand and to optimize inventory balances.
1146
triangular freight lanes
Freight trips of more than two legs used to coordinate movement of materials and goods between manufacturers, suppliers, and customers.
1147
trigger level
Syn.: order point.
1148
triple bottom line (TBL)
An approach that measures the economic, social, and environmental impact of an organization’s activities with the intent of creating value for both its shareholders and society.
1149
triple smoothing
A method of exponential smoothing that accounts for accelerating or decelerating trends, such as those that would be experienced in a fad cycle. Syn.: third-order smoothing.
1150
TRP
Acronym for transportation requirements planning.
1151
TRR
Acronym for time to reliably replenish.
1152
TRT
Abbreviation for transition tree.
1153
truckload (TL) carriers
Carriers that deliver/charge only for full- truckload shipments.
1154
truckload lot
A truck shipment that qualifies for a lower freight rate because it meets a minimum weight and/or volume.
1155
trust
A fiduciary relationship in which the trustee holds ownership for the benefit of another party (benefactor).
1156
TS 16949
Syn.: ISO/TS 16949.
1157
turnaround costs
Syn.: setup costs.
1158
turnaround time
Syns.: setup, cycle time.
1159
turnkey system
1) Computer packages that are already prepared by a hardware manufacturer or software house and are ready to run. 2) Any system of machines that is ready for immediate use.
1160
turnover
1) Syn.: inventory turnover. 2) In the United Kingdom and certain other countries, annual sales volume.
1161
turnover ratio
An indicator of whether or not a company is using its assets efficiently. It is measured by dividing sales by average assets during a particular period.
1162
turns
Syn.: inventory turnover.
1163
twenty-foot equivalent unit (TEU)
A measurement used to describe the carrying capacity of a cargo ship or a terminal’s handling capacity. One TEU equals a standard 20-foot x 8-foot x 8-foot (length x width x height) shipping container.
1164
TWM
Acronym for total waste management.
1165
two-bin inventory system
A type of fixed-order system in which inventory is carried in two bins. A replenishment quantity is ordered when the first bin (working) is empty. During the replenishment lead time, material is used from the second bin. When the material is received, the second bin (which contains a quantity to cover demand during lead time plus some safety stock) is refilled, and the excess is put into the working bin. At this time, stock is drawn from the first bin until it is again exhausted. This term also is used to loosely describe any fixed- order system even when physical bins do not exist. Syn.: bin reserve system. See: visual review system.
1166
two-card kanban system
A kanban system in which a move card and production card are employed. The move card authorizes the movement of a specific number of parts from a source to a point of use. The move card is attached to the standard container of parts during movement of the parts to the point of use. The production card authorizes the production of a given number of parts for use or replenishment. Syn.: dual-card kanban system. See: one-card kanban system.
1167
two-level master schedule
A master-scheduling approach in which a planning bill of material is used to master schedule an end product or family, along with selected key features (options and accessories). See: hedge, multilevel master schedule, production forecast.
1168
type I error
An incorrect decision to reject something (such as a statistical hypothesis or a lot of products) when it is acceptable. See: producer’s risk (ẞ).
1169
type II error
An incorrect decision to accept something when it is unacceptable. See: consumer’s risk (ẞ).
1170
U chart
A control chart for evaluating the stability of a process in terms of the average count of events of a given classification per unit occurring in a sample. Syn.: count-per-unit chart.
1171
U.S. Chemical Safety and Hazard Investigation Board (CSB)
An independent, non-regulatory federal agency that investigates significant chemical accidents in an effort to determine their underlying cause.
1172
U.S. Customs and Border Protection (CBP)
A law enforcement agency within the U.S. Department of Homeland Security. Its primary mission is to prevent people from entering the country illegally or bringing anything harmful or illegal into the United States.
1173
U.S. Department of Transportation (DOT)
An executive department of the U.S. federal government charged with overseeing federal transportation projects and setting safety regulations for all major forms of transportation.
1174
U.S. Environmental Protection Agency (EPA)
An independent executive agency of the U.S. federal government tasked with developing and enforcing environmental regulations, protecting people from significant health risks, and sponsoring research about the environment.
1175
U.S. Food and Drug Administration (FDA)
A federal agency of the department of health and human services charged with assuring foods are safe and properly labelled. The FDA also ensures that veterinary drugs and that human vaccines, biological products, and medical devices are safe and effective.
1176
ubiquity
In inventory control, a raw material that is found at all locations.
1177
UCL
Acronym for upper control limit.
1178
UDE
Abbreviation for undesirable effect. Pronounced “oodee.”
1179
U-lines
Production lines shaped like the letter U. The shape allows workers to easily perform several nonsequential tasks without much walk time. The number of workstations in a U-line is usually determined by line balancing. U-lines promote communication.
1180
UN Global Compact Management Model
A framework for guiding companies through the process of formally committing to, assessing, defining, implementing, measuring, and communicating the United Nations Global Compact and its principles. See: United Nations Global Compact.
1181
unattainable capability
The portion of the production capability that cannot be attained. This is typically caused by factors such as equipment unavailability, suboptimal scheduling, or resource limitations.
1182
uncertainty
Unknown future events that cannot be predicted quantitatively within useful limits, such as an accident that destroys facilities, a major strike, or an innovation that makes existing products obsolete.
1183
uncontrollable factors
In the environment of a production system, those factors that cannot be changed (e.g., temperature, natural causes, weather, or vibration).
1184
under-capacity scheduling
Allowing more time than should be necessary to complete a day’s work. As a result, a daily quota is met more often and workers have time to cross-train or perform maintenance on their tools and machines.
1185
undertime
A condition occurring when more personnel are on the payroll than are required to produce the planned output.
1186
undesirable effects (UDE)
In theory of constraints, those negative aspects of an environment that are noted so that a current reality tree may be constructed.
1187
unfair labor practice
Activities by management or labor that violate the National Labor Relations Act. Failure to bargain in good faith is an example.
1188
uniform commercial code (UCC)
A comprehensive set of laws governing all commercial transactions in the United States. While not a federal law, it is uniformly adopted by most states, which allows businesses to enter into contracts with the confidence that the terms will be enforced the same way in every jurisdiction.
1189
uniform plant loading
In lean, the distribution of work among work stations so that the time required for each station to complete all tasks is as close to equal as possible. See: line balancing.
1190
uniform product code
A retail product numbering and barcoding system that identifies the item and the manufacturer.
1191
uniform resource locator (URL)
A means of locating web pages regardless of where they are on the internet.
1192
uniform warehouse receipts act
An act that regulates public warehousing. It sets up the legal responsibilities of warehouse managers and determines the receipts that can be issued.
1193
uniform-delivered pricing
A type of geographic pricing policy in which all customers pay the same delivered price regardless of their locations. A company allocates the total transportation cost among all customers.
1194
union contract
A formal contract between a company and the union representing its employees, usually covering two to six years, that covers all aspects of pay, working conditions, and strike options.
1195
union free
A designation that indicates that a company or operation does not have a union contract.
1196
union shop
A facility in which all hourly employees are unionized. More formally, it is a clause in a collective bargaining agreement under which membership in the union is required as a condition of employment. Union shops are illegal in some regions.
1197
unit cost
Total labor, material, and overhead cost for one unit of production (e.g., one part, one gallon or one pound).
1198
unit load
A shipping unit made up of a number of items. Bulky material is arranged or constrained so the mass can be picked up or moved as a single unit. This reduces materials handling costs. A unit load is often shrink-packed on a pallet before shipment.
1199
unit load concept
Waiting for a container or pallet to be filled before the material is moved.
1200
unit of driver measure
The common unit of measure used to group similar processes so comparisons can be made easily.
1201
unit of issue
The standard issue quantity of an item from stores (e.g., pounds, each, box of 12, package of 20, or case of 144).
1202
unit of measure
The unit in which the quantity of an item is managed (e.g., pounds, each, box of 12, package of 20, or case of 144).
1203
unit of measure (purchasing)
The unit used to purchase an item. This may or may not be the same unit of measure used in the internal systems. For example, purchasing buys steel by the ton, but it may be issued and used in square inches. Syn.: purchasing unit of measure.
1204
United Nations Global Compact
A voluntary initiative whereby companies embrace, support, and enact, within their sphere of influence, a set of core values in the areas of human rights, labor standards, the environment, and anticorruption. United Nations Standard Products and Services Code®
1205
(UNSPSC®)
A global, open standard for classifying products and services across sectors using a hierarchy based on segment, family, class, and commodity information.
1206
United States-Mexico-Canada Agreement (USMCA)
A free- trade agreement among Canada, Mexico, and the United States that is designed to reduce or eliminate duties on goods that move among the three countries.
1207
unitization
In warehousing, the consolidation of several units into larger units for fewer handlings.
1208
unit-of-measure conversion
A standard conversion ratio that a company or its computer system uses to quickly enter in the amount delivered based on a known quantity within each unit of measure (e.g., a case of soda contains 24 cans).
1209
units per transaction
A sales metric, often used in the retail sector, to measure the average number of items that customers are purchasing in a given transaction.
1210
unit-size
To combine a number of packages into one unit by attaching them together.
1211
units-of-production depreciation
A method of depreciation whereby the amount to be recovered (written off as a period expense) is calculated based on the estimated life of the equipment in units to be produced over the life and the number of units produced in a given time period. See: depreciation.
1212
universality
The strategy of designing a product initially intended for one market in such a way that it can also be sold in other markets. This is a form of standardization.
1213
universe
The population, or large set of data, from which samples are drawn. It is usually assumed to be infinitely large or at least very large relative to the sample.
1214
unplanned issue
An issue transaction that updates the quantity on hand but for which no allocation exists.
1215
unplanned order
After a forecast has been developed, an unplanned order is any order outside this forecast.
1216
unplanned receipt
A receipt transaction that updates the quantity on hand but for which no order exists.
1217
unplanned repair
Repair and replacement requirements that are unknown until remanufacturing teardown and inspection.
1218
UNSPSC®
Acronym for United Nations Standard Products and Services Code®
1219
upcharges
Additional charges added to a delivered bill that were not included in the original contract. These occur because of unforeseen increases in the deliverer’s cost base.
1220
upgrade
Improvement in operating characteristics.
1221
upper control limit (UCL)
Control limit for points above the central line in a control chart.
1222
upper specification limit (USL)
In statistical process control, the line that defines the maximum acceptable level of random output. See: tolerance limits.
1223
upside flexibility
The ability of a facility to increase its output and capacity to deliver for the foreseeable future in order to meet a non-forecasted increase in demand. The main drivers of this flexibility are the availability of direct labor and/or direct materials and the actual production capacity of the facility.
1224
upside supply chain adaptability
A discrete measurement of the quantity of increased production a supply chain can achieve and sustain for 30 days.
1225
upside supply chain flexibility
A discrete measurement of the amount of time it takes a supply chain to respond to an unplanned 20 percent increase in demand without service or cost penalty.
1226
upstream
Used as a relative reference within a firm or supply chain to indicate moving in the direction of the raw material supplier.
1227
URL
Acronym for uniform resource locator.
1228
usage
The number of units or dollars of an inventory item consumed over a period of time.
1229
usage rate
Demand per product per unit of time.
1230
usage variance
Deviation of the actual consumption of materials as compared with the standard.
1231
use as is
Classification for material that has been declared to be unacceptable per the specifications yet can be used.
1232
user interface
The portion of a computer system through which the end user interacts with the system. This may include the keyboard, mouse, touch screen, and other devices.
1233
user-friendly
A characteristic of computer software or hardware that makes it easy for the user or operator to use the programs or equipment with a minimum of specialized knowledge or recourse to operating manuals.
1234
U-shaped layout
A process layout in which the sequence of activities is arranged in the shape of a U. The first and last stages of the process are next to each other. This strategy is commonly used in manufacturing cells and warehouses where receiving and shipping docks are next to each other.
1235
USL
Abbreviation for upper specification limit.
1236
utilization
1) A measure (usually expressed as a percentage) of how intensively a resource is being used to produce a good or service. This measure compares actual time used to available time. Traditionally, it is calculated as the ratio of direct time charged (run time plus setup time) to the clock time available. Utilization is a percentage between 0 percent and 100 percent that is equal to 100 percent minus the percentage of time lost due to the unavailability of machines, tools, workers, and so forth. See: efficiency, lost-time factor, productivity. 2) In theory of constraints, activation of a resource that productively contributes to reaching the goal. Over-activation of a resource does not productively utilize a resource. 3) In warehousing, the consolidation of several units into fewer larger units to reduce handling. See: available time.
1237
valid schedule
A detailed, feasible calendar of specific items flowing into and through a factory.
1238
valuation
The technique of determining worth, typically of inventory. Valuation of inventories may be expressed in standard dollars, replacement dollars, current average dollars, or last-purchase-price dollars.
1239
value
The worth of an item, good, or service.
1240
value added
1) In accounting, the addition of direct labor, direct material, and allocated overhead assigned at an operation. It is the cost roll-up as a part goes through a manufacturing process to finished inventory. 2) In current manufacturing terms, the actual increase of utility from the viewpoint of the customer as a part is transformed from raw material to finished inventory. It also refers to the contribution made by an operation or a plant to the final usefulness and value of a product, as seen by the customer. The objective is to eliminate all non-value-added activities in producing and providing a good or service.
1241
value analysis
The systematic use of techniques that identify a required function, establish a value for that function, and finally provide that function at the lowest overall cost. This practice focuses on the functions of an item rather than the methods of producing the present product design.
1242
value at risk (VAR)
The sum of the probability of risk events multiplied by the monetary impact of events. A risk event is defined as a deviation from the expected metrics value for the process. See: overall value at risk (VAR).
1243
value chain
The functions within a company that add value to the goods or services that the organization sells to customers and for which it receives payment.
1244
value chain analysis
An examination of all links a company uses to produce and deliver its products and services, starting from the origination point and continuing through delivery to the final customer.
1245
value chain initiative
A process that combines software, hardware, and supply chain companies to develop an integrated system to support software sharing among diverse applications.
1246
value delivery network
The resources and processes used to deliver a product to customers.
1247
value engineering and/or analysis
A disciplined approach to the elimination of waste from products or processes through an investigative process that focuses on the functions to be performed and whether such functions add value to the good or service.
1248
value index
A measure that uses the performance and importance scores for various dimensions of performance for an item or service to calculate a score that indicates the overall value of the item or service to a customer.
1249
value of transfers
The amount transferred, in a fiscal year, from one stage of the manufacturing process to another (e.g., the amount of raw materials that are transformed into work in process).
1250
value perspective
A quality perspective that holds that quality must be judged, in part, by how well the characteristics of a particular product or service align with the needs of a specific user.
1251
value stream
The processes of creating, producing, and delivering a good or service to the market. For a good, the value stream encompasses the raw material supplier, the manufacture and assembly of the good, and the distribution network. For a service, the value stream consists of suppliers, support personnel and technology, the service producer, and the distribution channel. A value stream may be controlled by a single business or a network of several businesses.
1252
value stream map
A graph displaying the sequence of operations needed to produce and deliver a product or service.
1253
value stream mapping (VSM)
A lean production tool to visually understand the flow of materials from supplier to customer that includes the current process and flow as well as the value- added and non-value-added time of all the process steps. It is used to help reduce waste, decrease flow time, and make the process flow more efficient and effective.
1254
value-added network (VAN)
A network, often supporting electronic data interchange, providing services additional to those provided by common carriers.
1255
value-added productivity per employee
A measure that is determined by three things: total output of a company, materials purchased, and total employment. It is found by subtracting materials purchased from total output and then dividing that number by total employment. This figure allows a company to understand easily how much production the typical employee is producing.
1256
value-added tax (VAT)
A type of tax that is assessed incrementally and levied on the price of a product or service at each stage of production, distribution, or sale to the end consumer. The tax is carefully tracked in returns, and routes are optimized to minimize tax, duty, and value-added tax considerations. This tax is known in some countries as a goods and services tax. See: foreign/free trade zone (FTZ).
1257
value-adding/non-value-adding
The assessment of each of the company’s activities to determine if that activity adds value to the organization or its customers. If an activity is considered non-value-adding, it should be eliminated to increase an organization’s efficiency.
1258
value-based management (VBM)
The concept of satisfying customers to create shareholder wealth.
1259
value-driven enterprise
An organization that is designed and managed to add utility from the viewpoint of the customer in the transformation of raw materials into a finished good or service.
1260
value-of-service pricing
Allowing the market to determine the price.
1261
valve inventory
In a just-in-time context, inventory at a stockpoint that is too large to be located next to the point of use of the material and from which material is drawn by a pull system. It is often located at a stockpoint in the plant’s receiving area.
1262
VAN
Abbreviation for value-added network.
1263
VAR
Acronym for value at risk.
1264
variable
A quantity that can assume any of a given set of values. Ant.: constant.
1265
variable cost
An operating cost that varies directly with a change of one unit in the production volume (e.g., direct materials consumed or sales commissions).
1266
variable costing
An inventory valuation method in which only variable production costs are applied to the product; fixed factory overhead is not assigned to the product. Traditionally, variable production costs are direct labor, direct material, and variable overhead costs. Variable costing can be helpful for internal management analysis but is not widely accepted for external financial reporting. For inventory order quantity purposes, however, the unit costs must include both the variable and allocated fixed costs to be compatible with the other terms in the order quantity formula. For make-or-buy decisions, variable costing should be used rather than full absorption costing. Syn.: direct costing.
1267
variable overhead
All manufacturing costs, other than direct labor and direct materials, that vary directly with production volume. Variable overhead is necessary to produce the product but cannot be directly assigned to a specific product.
1268
variable yield
The condition that occurs when the output of a process is not consistently repeatable in quantity, quality, or a combination of both.
1269
variables data
Measurement information. Control charts based on variables data include average (X-bar) charts, range (R) charts, and sample standard deviations charts.
1270
variance
1) The difference between the expected (budgeted or planned) value and the actual value. 2) In statistics, a measurement of dispersion of data. See: estimate of error.
1271
variation
A change in data, a characteristic, or a function that is caused by one of four factors: special causes, common causes, tampering, or structural variation.
1272
VATI analysis
In theory of constraints, a procedure for determining the general flow of parts and products from raw materials to finished products (logical product structure). A V logical structure starts with one or a few raw materials, and the product expands into a number of different products as it flows through divergent points in its routings. The shape of an A logical structure is dominated by converging points. Many raw materials are fabricated and assembled into a few finished products. A T logical structure consists of numerous similar finished products assembled from common assemblies, subassemblies, and parts. An I logical structure is the simplest of production flows, in which resources are shared between or among different products and the flow is in a straight line sequence (e.g., an assembly line). Once the general parts flow is determined, the system control points (gating operations, convergent points, divergent points, constraints, and shipping points) can be identified and managed.
1273
VBM
Abbreviation for value-based management.
1274
vehicle
A carrying and power unit to move goods. This includes all forms of transportation means except pipeline. The carrier generally owns or leases vehicles, but a shipper also may own or lease.
1275
velocity
1) The rate of change of an item with respect to time. See: inventory turnover, lead time. 2) In supply chain management, a term used to indicate the relative speed of all transactions, collectively, within a supply chain community. A maximum velocity is most desirable because it indicates higher asset turnover for stockholders and faster order-to-delivery response for customers.
1276
vendor
Any seller of an item in the marketplace. See: supplier.
1277
vendor lead time
Syn.: supplier lead time.
1278
vendor measurement
The act of measuring the vendor’s performance to a contract. Measurements usually cover delivery reliability, lead time, quality, and price. See: supplier measurement.
1279
vendor scheduler
Syn.: supplier scheduler.
1280
vendor scheduling
Syn.: supplier scheduling.
1281
vendor-managed inventory (VMI)
A means of optimizing supply chain performance in which the supplier has access to the customer’s inventory data and is responsible for maintaining the inventory level required by the customer. This is accomplished by a process in which resupply is performed by the vendor through regularly scheduled reviews of the on-site inventory. The on-site inventory is counted, damaged or outdated goods are removed, and the inventory is restocked to predefined levels. The vendor obtains a receipt for the restocked inventory and accordingly invoices the customer. See: continuous replenishment.
1282
vendor-owned inventory (VOI)
Syn.: consigned stocks.
1283
venture team
A set of individuals assigned outside normal channels to develop ideas for new products.
1284
vertical dependency
The relationship between a parent item and a component in its bill of material that defines the need for the component based on producing the parent, without regard to the availability of other components at the same level in the bill of material. See: horizontal dependency.
1285
vertical display
A method of displaying or printing output from a material requirements planning system in which requirements, scheduled receipts, projected balance, and so forth are displayed vertically. Vertical displays are often used in conjunction with bucket-less systems. Ant.: horizontal display.
1286
vertical integration
The degree to which a firm has decided to directly produce multiple value-adding stages from raw material to the sale of the product to the ultimate consumer. The more steps in the sequence, the greater the vertical integration. A manufacturer that decides to begin producing parts, components, and materials that it normally purchases is said to be backward integrated. Likewise, a manufacturer that decides to take over distribution and perhaps sale to the ultimate consumer is said to be forward integrated. See: backward integration, forward integration.
1287
vertical marketing
A coordinated product marketing system, with activities undertaken by one company, for a supply chain.
1288
vertical marketing system
A marketing system that focuses on the means to reduce the traditional independence of indirect channels. The system strategically seeks to increase the integration and interdependence of channels by uniting them with common objectives and team management (e.g., franchising, cooperatives, or vertical integration).
1289
vertical marketplace
An online marketplace connecting buyers and sellers within the same industry. It enables lower prices by lowering transaction costs.
1290
vertical merger
An alliance of two firms in which one firm is a supplier to the other.
1291
vertical-lift module
A part storage and retrieval system that uses vertical racks to store items and an automated storage/ retrieval system to insert and retrieve those items.
1292
vertically integrated firm
An organization with functions that were previously performed by suppliers but are now done internally. See: horizontally integrated firm.
1293
vestibule training
A variant of job rotation in which a separate work area is set up for a trainee so that the actual work situation does not pressure the trainee. Examples are cockpit simulators and other machine simulators.
1294
viral marketing
An advertisement that is embedded into web-based technology (e.g., email or pop-up ads) that can easily move through the internet and get in front of the target audience, who may never have seen it otherwise.
1295
virtual cell
A logical rather than physical grouping of manufacturing resources. Resources in virtual cells can be dispersed throughout a facility. Product mix changes may change the layout of a virtual cell. This technique is used when it is not practical to move the equipment.
1296
virtual corporation
The logical extension of outpartnering. With the virtual corporation, the capabilities and systems of the firm are merged with those of the suppliers, resulting in a new type of corporation in which the boundaries between the suppliers’ systems and those of the firm seem to disappear. The virtual corporation is dynamic in that the relationships and structures formed change according to the changing needs of the customer.
1297
virtual factory
A transformation process most frequently found under the virtual corporation. It involves merging the capabilities and capacities of the firm with those of its suppliers. Typically, the components provided by the suppliers are those that are not related to a core competency of the firm, while the components managed by the firm are related to core competencies. One characteristic of the virtual factory is that it can be restructured quickly in response to changing customer demands and needs.
1298
virtual inventory system
A virtual system that enables supply chain partners to share data in a central database.
1299
virtual organization
Short-term alliances between independent organizations in a potentially long-term relationship to design, produce, and distribute a product. Organizations cooperate based on mutual values and act as a single entity to third parties.
1300
virtual reality
Hardware and software that create an apparently real environment.
1301
virtual supply chain
A collection of firms that typically exists for only a short period. Virtual supply chains are more flexible than traditional supply chains but less efficient.
1302
virtual trading exchange
An online trading exchange that enables both information integration and collaboration among multiple trading partners.
1303
virtual warehouse
1) The application of digital technology to provide visibility to inventory stored in multiple stocking locations and real-time decision-making tools to fulfill demand in a way that minimizes cost and maximizes service. 2) A non- physical warehouse used to designate an inventory location for a specific purpose, e.g., rework inventory that is physically in one warehouse but shows in a non-allocatable virtual warehouse.
1304
visibility
The ability to view important information throughout a facility or supply chain no matter where in the facility or supply chain the information is located.
1305
vision
The shared perception of the organization’s future—what the organization will achieve and a supporting philosophy. This shared vision must be supported by strategic objectives, strategies, and action plans to move it in the desired direction. See: vision statement.
1306
vision statement
An organization’s statement of its vision. See: vision.
1307
visioning
The process of developing a plan for how an organization will perform in the future.
1308
visits
In e-commerce, the set of requests made by one user at one website. If there is no activity within a given time frame (usually 30 minutes), the visit is considered closed.
1309
visual control
1) The control of authorized levels of activities and inventories in a way that is instantly and visibly obvious. 2) A type of activity and inventory control used in a workplace organization where everything has an assigned place and is in its place.
1310
visual inspection
Inspection performed without test instruments.
1311
visual management
A management system in which every metric that matters, standardized work, and improvement approaches are displayed on the shop floor and in the office.
1312
visual review system
A simple inventory control system in which the inventory reordering is based on actually looking at the amount of inventory on hand. This is usually used for low-value items, such as nuts and bolts. See: two-bin inventory system.
1313
vital few, useful many
A term used by J.M. Juran to describe his use of the Pareto principle in quality management, which he first described in 1950. (The principle was used much earlier in economics and inventory control methodologies.) The principle suggests that most effects come from relatively few causes — that is, 80 percent of the effects come from 20 percent of the possible causes. The 20 percent of the possible causes are referred to as the vital few; the remaining causes are referred to as the useful many. When Juran first defined this principle, he referred to the remaining causes as the trivial many, but because no problems are trivial in quality assurance, he changed it to useful many.
1314
VMI
Abbreviation for vendor-managed inventory.
1315
VOC
Acronym for voice of the customer.
1316
VOI
Abbreviation for vendor-owned inventory.
1317
voice of the customer (VOC)
Actual customer descriptions in words for the functions and features customers desire for goods and services. In the strict definition, as related to quality function deployment, the term customer indicates the external customer of the supplying entity.
1318
voice pick system
Syn.: pick-to-voice system.
1319
voice-based picking
Syn.: pick-to-voice system.
1320
volume discount
See: discount, price break.
1321
volume flexibility
The ability of the transformation process to quickly accommodate large variations in production levels.
1322
voluntary layoff
Layoffs in which the employees are given the option of taking a non-paid leave from their work for a short, specified period of time.
1323
voucher
A written document that bears witness to, or vouches for, something. A voucher generally is an instrument that shows services performed or goods purchased and authorizes payment to the supplier.
1324
VSM
Acronym for value stream mapping.
1325
Wagner-Whitin algorithm
A mathematically complex, dynamic lot-sizing technique that evaluates all possible ways of ordering to cover net requirements in each period of the planning horizon to arrive at the theoretically optimum ordering strategy for the entire net requirements schedule. See: discrete order quantity, dynamic lot sizing.
1326
wait time
The time a job remains at a work center after an operation is completed until it is moved to the next operation. It is often expressed as a part of move time.
1327
waiting line theory
Syn.: queuing theory.
1328
waiver
Authorization to accept an item that, during production or upon inspection, is found to depart from specified requirements but nevertheless is considered suitable for use as is or after rework.
1329
walkie trucks
A warehouse truck where the lift and vehicle movement are performed by electrically powered on-board battery drive motors. This type of truck may or may not have a rider. There are many forms of walkie vehicles, each with differing operational and physical configurations depending on its intended work area and task requirements.
1330
walkthrough
Syn.: pilot test.
1331
wall-to-wall inventory
An inventory management technique in which material enters a plant and is processed through the plant into finished goods without ever having entered a formal stock area. Syn.: four-wall inventory.
1332
WAN
Acronym for wide area network.
1333
wand
A device connected to a barcode reader to identify a barcode.
1334
wandering bottleneck
An undesirable effect in which the bottleneck moves relatively frequently from one resource to another.
1335
warehouse
A place to receive, store, and ship materials.
1336
warehouse automation
The utilization of mechanical or electronic devices to complete tasks related to storing, retrieving, and moving inventory as a substitute for labor resources. It is used for cost savings, added security, and to keep human workers out of sensitive environments.
1337
warehouse demand
The need for an item to replenish stock at a branch warehouse. Syn.: branch warehouse demand. warehouse management and transportation execution
1338
systems
Logistics information systems that initiate and control the movement of materials between supply chain partners.
1339
warehouse management system (WMS)
A computer application system designed to manage and optimize workflows and the storage of goods within a warehouse. It often interfaces with automated data capture and enterprise resource planning systems.
1340
warehouse receiving
A key process in warehouse operation that ensures the correct product has been received, in the right quantity, in the right condition, and at the right time.
1341
warranty of merchantability
An implied warranty that goods are fit for the use to which they are generally applied.
1342
waste
1) Any activity that does not add value to the good or service in the eyes of the consumer. 2) A by-product of a process or task with unique characteristics requiring special management control. Waste production can usually be planned and somewhat controlled. Scrap is typically not planned and may result from the same production run as waste. See: hazardous waste.
1343
waste exchange
1) Arrangement in which companies exchange their wastes for the benefit of both parties. 2) An exchange service of valuable information between generators and potential users of industrial and commercial wastes, whereby a beneficial use rather than disposal is the end result. This service identifies both the producers and potential markets for by- products, surpluses, unspent materials, and other forms of solid waste that are no longer needed.
1344
waste hierarchy
A process that ranks waste management options according to what is most environmentally sound, giving top priority to preventing waste. The hierarchy from top to bottom is reduce, reuse, recycle, recovery, and disposal.
1345
waterspider
An expert worker who makes the rounds of workstations and provides assistance as needed. The waterspider knows all processes well enough to take over if necessary. At Toyota Motor Corporation, this position is a prerequisite to supervision and management positions.
1346
wave picking
A method of selecting and sequencing picking lists or items to minimize the waiting time of the delivered material. Shipping orders may be picked in waves combined by common carrier or destination, and manufacturing orders in waves related to work centers.
1347
warehouse storage
Using a building or other structure as a planned space for storing goods and materials.
1348
waybill
A document containing a list of goods with shipping instructions related to a shipment.
1349
warehouses (distribution centers)
Facilities used to store inventory. Decisions driving warehouse management include site selection; number of facilities in the system; layout; and methods of receiving, storing, and retrieving goods.
1350
ways
Paths over which a carrier operates, including right-of- way, roadbed, tracks, and other physical facilities. These may be owned by the government, privately held by the carrier, or provided by nature.
1351
warehousing
The activities related to receiving, storing, and shipping materials to and from production or distribution locations.
1352
warranty
A commitment, either expressed or implied, that a certain fact regarding the subject matter of a contract is presently true or will be true. The word should be distinguished from a guarantee, which means a contract or promise by an entity to answer for the performance of a product or person. See: general warranty, guarantee, special warranty.
1353
warranty costs
All of the costs associated with a warranty, including shipping, receiving, repairing, replacement, and the materials needed for repair or replacement.
1354
wearable
A form of technology worn on the body that allows hands-free work by being voice and/or gesture activated. Wearables can be used for a wide variety of activities within a supply chain, including tracking activity levels, distances moved to execute transactions, and even the exact location of workers in the warehouse.
1355
web directory
A list of web pages that is structured hierarchically.
1356
web page
A document containing hypertext links to certain other documents (including multimedia documents).
1357
web services
A common internet or intranet framework that enables the movement of data from one supply chain application to another, without the requirement for a direct connection between the two applications and without regard to the underlying operating system for those applications.
1358
web-based return material authorization
Procedures and policies that enable customers to fill out return material authorization (RMA) forms online. The practice cuts down on the manual effort, processing time, and risk of error.
1359
webcasting
Syn.: push technology.
1360
weight confirmation
The process of confirming a shipment arrival only by confirming that the correct weight has been delivered.
1361
weighted moving average
An averaging technique in which the data to be averaged is not uniformly weighted but is given values according to its importance. See: moving average, simple moving average.
1362
weighted-factor rating model
A method to analyze the advantages of various locations along several qualitative and quantitative dimensions.
1363
weighted-point plan
A supplier selection and rating approach that uses the input gathered in the categorical plan approach and assigns weights to each evaluation category. A weighted sum for each supplier is obtained, and a comparison is made. The weights used should total 100 percent for all categories. See: categorical plan.
1364
what-if analysis
The process of evaluating alternate strategies by answering the consequences of changes to forecasts, manufacturing plans, inventory levels, and so forth. See: simulation.
1365
what-if simulation
An approach to conducting a what-if analysis usually found in manufacturing resource planning and enterprise resource planning systems.
1366
wheel chock
A wedge of sturdy material placed against a vehicle's wheel to prevent accidental movement.
1367
where-used list
A listing of every parent item that calls for a given component, and the respective quantity required, from a bill-of-material file. See: implosion.
1368
wholesaler
Syn.: distributor.
1369
wide area network (WAN)
A public or private data communication system for linking computers distributed over a large geographic area.
1370
will call
A service process that allows customers to walk up to the seller’s facility and pick up the parts they have previously ordered.
1371
WIP
Acronym for work in process.
1372
withdrawal
1) Removal of material from stores. 2) A transaction issuing material to a specific location, run, or schedule.
1373
withdrawal kanban
An indicator that a container can be transported between work areas.
1374
WMS
Abbreviation for warehouse management system.
1375
work breakdown structure
In project management, a hierarchical description of a project in which each lower level is more detailed. See: project summary work breakdown structure.
1376
work cell
Dissimilar machines grouped together into a production unit to produce a family of parts having similar routings.
1377
work center
A specific production area, consisting of one or more people and/or machines with similar capabilities, that can be considered as one unit for purposes of capacity requirements planning and detailed scheduling. Syn.: load center.
1378
work center load evaluation
Determining the workload on work centers to identify bottlenecks in the operation and then evaluating the planned loads on these work centers.
1379
work center master
A file that contains information about a specific work center, such as capacity information, hours worked per shift, shifts worked, utilization, and efficiency.
1380
work center schedule
Syn.: dispatch list.
1381
work center where-used
A listing (constructed from a routing file) of every manufactured item that is routed (primary or secondary) to a given work center.
1382
work in process (WIP)
A good or goods in various stages of completion throughout the plant, including all material from raw material that has been released for initial processing up to completely processed material awaiting final inspection and acceptance as finished goods inventory. Many accounting systems also include the value of semifinished stock and components in this category. Syn.: in-process inventory.
1383
work measurement
Estimating how long it takes for an employee to produce one unit of output.
1384
work order
1) An order to the machine shop for tool manufacture or equipment maintenance. This is not to be confused with a manufacturing order. Syn.: work ticket. 2) An authorization to start work on an activity (e.g., maintenance) or product.
1385
work package
In project management, a deliverable at the bottom of a work breakdown structure. This may be treated as a subproject to be assigned to a project manager to plan and execute, in which case this manager will define new activities.
1386
work rules
1) Compensation rules concerning such issues as overtime, vacation, and shift premiums. 2) Between employee and employer, job rights and obligation rules, such as performance standards, promotion procedures, job descriptions, and layoff rules. Work rules are usually a part of a union contract and may include a code of conduct for workers and language to ensure decent conditions and health standards.
1387
work sampling
The use of a number of random samples to determine the frequency with which certain activities are performed.
1388
work sequence
Ordered activities performed to accomplish work.
1389
work teams
Teams of employees formed to shepherd a particular work area or function.
1390
work ticket
Syn.: work order.
1391
workaround
A project management technique that provides a response to a negative risk or event that has happened. A workaround is different from a contingency plan because a workaround is not planned before the risk event occurs.
1392
worker efficiency
A measure (usually computed as a percentage) of worker performance that compares the standard time allowed to complete a task with the actual worker time to complete it. Syn.: labor efficiency.
1393
worker productivity
The value of total goods and services produced by an employee divided by the labor hours required to produce those goods and services.
1394
workers’ compensation
A state-administered program whereby employees are guaranteed medical coverage and replacement of earnings in case they are injured on the job, and companies are limited as to their liability for such job-related injuries. This was formerly known as workmen’s compensation.
1395
working capital
Syn.: net working capital.
1396
working stock
Stock located in a facility that is used to fulfill demand.
1397
workload
Syn.: load.
1398
workplace organization
The arrangement of tools, equipment, materials, and supplies according to their frequency of use. Those items that are never used are removed from the workplace, and those items that are used frequently are located for fast, easy access and replacement. This concept extends the idea of “a place for everything and everything in its place.”
1399
workstation
The assigned location where a worker performs the job. It could be a machine or a workbench.
1400
World Trade Organization (WTO)
The successor to the General Agreement on Tariffs and Trade (GATT) and the current international agency overseeing trade between nations.
1401
world-class company
An organization that has reached a level of excellence because of superior products or services and customer satisfaction. Such an organization represents the best of the best.
1402
world-class quality
A term used to indicate a standard of excellence. It describes the best of the best.
1403
write-off
In accounting, the process of removing an asset from an organization’s books through the expensing process.
1404
WTO
Acronym for World Trade Organization.
1405
X-bar chart
Syn.: average chart.
1406
XML
Abbreviation for extensible markup language.
1407
yard management system (YMS)
A system that organizes and directs the traffic of all vehicles in the parking yards located at various industrial buildings like warehouses, distribution centers, and manufacturing plants.
1408
yellow belt
One who has completed six sigma training in certain hands-on tools.
1409
yellow zone
The middle-level buffer zone in drum-buffer-rope scheduling where the yellow color is used to indicate cautious situation of buffer consumption.
1410
yield
The amount of good or acceptable material available after the completion of a process. It is usually computed as the final amount divided by the initial amount converted to a decimal or percentage. In manufacturing planning and control systems, yield is usually related to specific routing steps or to the parent item to determine how many units should be scheduled to produce a specific number of finished goods. For example, if 50 units of a product are required by a customer and a yield of 70 percent is expected, then 72 units (computed as 50 units divided by .7) should be started in the manufacturing process. Syn.: material yield. See: scrap factor, yield factor.
1411
yield factor
A measurement of the yield of a process. For a specific process or operation, yield factor plus scrap factor equals 1. See: scrap factor, yield.
1412
yield management
An approach commonly used by services with highly perishable products in which prices are regularly adjusted to maximize total profit.
1413
YMS
Acronym for yard management system.
1414
yokoten
A Japanese word meaning sharing information.
1415
zero defects
A performance standard developed by Philip B. Crosby to address a dual attitude in the workplace: People are willing to accept imperfection in some areas, while in other areas they expect the number of defects to be zero. This dual attitude has developed as a result of the conditioning that people are human, and humans make mistakes. However, the zero-defects methodology states that if people commit themselves to watching details and avoiding errors, they can move closer to the goal of zero defects. The performance standard that must be set is zero defects, not close enough.
1416
zero inventories
Syn.: just in time (JIT).
1417
zero-based budgeting
A budget procedure used primarily by governmental agencies in which managers are required to newly justify each budgetary expenditure as if the budget were being initiated for the first time, rather than being based on an adjustment of prior-year data.
1418
zone
1) A warehouse location methodology that includes some of the characteristics of fixed and random location methods. Zone locations hold certain kinds of items, depending on physical characteristics or frequency of use. 2) The specific warehouse location assigned to an order picker. In picking items for an order, the stock picker gets only the items for each order that are within his or her zone. The picker then fills the next order for items from his or her zone.
1419
zone of freedom
Legal authority for transportation companies to charge, within limits, more than their variable costs.
1420
zone picking
A method of subdividing a picking list by areas within a storeroom for more efficient and rapid order picking. A zone-picked order must be grouped to a single location before delivery or must be delivered to different locations such as work centers. See: batch picking, discrete order picking, order picking.
1421
zone price
A standard product price that applies to all geographic locations within a zone.
