SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated:February2010Buying Cards (P-Cards): Basically these are a form of credit card used to make maintenance, repair, andoperating (MRO) inventory type purchases verses using a purchase order (PO) that can cost more to process forsmall purchases.Companiesusingthesecards typicallywork with card issuers to develop guidelines foruse-sometimes by value limits and type of expense-which provide control over authorized purchases at the pointof sale.Byte: A computer term used to define a string of 7 or 8 bits, or binary digits.The length of the string determinesthe amount of data that can be represented. The 8-bit byte can represent numerous special characters, 26uppercaseandlowercasealphabeticcharacters,and10numericdigits,totaling256possiblecombinationsDelfitions compiled by:Kate Vitasekwww.scvisions.comCSCMP does not take responsibility for these definitions nor endorses these as official definitions except as notedPage 26 of 212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Byte: A computer term used to define a string of 7 or 8 bits, or binary digits. The length of the string determines the amount of data that can be represented. The 8-bit byte can represent numerous special characters, 26 uppercase and lowercase alphabetic characters, and 10 numeric digits, totaling 256 possible combinations. Buying Cards (P-Cards): Basically these are a form of credit card used to make maintenance, repair, and operating (MRO) inventory type purchases verses using a purchase order (PO) that can cost more to process for small purchases. Companies using these cards typically work with card issuers to develop guidelines for use—sometimes by value limits and type of expense—which provide control over authorized purchases at the point of sale. Definitions compiled by: Kate Vitasek www.scvisions.com CSCMP does not take responsibility for these definitions nor endorses these as official definitions except as noted. Page 26 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated:February2010cCabotage: A federal law that requires coastal and inter-coastal traffic to be carried in U.S.-built and -registeredships.CADEX:SeeCustomsAutomated Data ExchangeSystemCAE: See Computer Aided EngineeringCage: (1) A secure enclosed area for storing highly valuable items, (2) a pallet-sized platform with sides that can besecured to the tines of a forklift and in which a person may rideto inventory items stored will above thewarehousefloor.CAGE Code: The Commercial and Government Entity code is a 5 character (number and letters) code used toidentifycontractorsdoingbusinesswiththeU.S.Government.Caged:Referring to the practice of placing high-value or sensitive products in a fenced off area withina warehouse.Calendar Days:The conversion of working days to calendar days is based on the number of regularly scheduledworkdaysper week inyour manufacturing calendar.To convertfromworking daystocalendardays:Ifwork week:= 4 days, multiply by 1.75Calculation:=5days,multiplyby1.40=6days,multiplyby1.17Call Center:A call center is a centralized office used for the purpose of receiving and transmitting a large volume ofrequestsbytelephone.Acall centreisoperated bya companytoadministerincomingproduct support or informationinquiriesfrom consumers.Outgoing calls for telemarketing,clientele,product services,and debt collection arealsomade.Inaddition to a call centre,collectivehandling of letters,faxes, livechat,and e-mails at one location isknownas a contact center.Synonym:CustomerInteractionCenterCall-off Orders: A strategy to delay delivery of items that are not needed immediately.Instead, you"call off" theitemsfrom thepurchaseorderyou want asyouneed them.Seealso:BlanketPurchaseOrderCall Volume:Thenumber of telephone calls made or received overa specific period of time.Can-order Point: A supplier ordering method where multiple items from the same vendor are considered /reviewed if any one item from that vendorfalls belowa specific orderpoint (either set or calculated).Once an itemtriggers an order, any other items which are near their order point are also considered. This is done to preventmultiple orders for a single vendor in a short time frame, allowing for possible price breaks and shipping discounts.Definitions compiled by:Kate Vitasekwww.scvisions.comCSCMP does not take responsibility for theanofnofficialdefinitioexceptasnotedPage 27 of 212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT CAGE Code: The Commercial and Government Entity code is a 5 character (number and letters) code used to identify contractors doing business with the U.S. Government. Calendar Days: The conversion of working days to calendar days is based on the number of regularly scheduled workdays per week in your manufacturing calendar. To convert from working days to calendar days: If work week: Caged: Referring to the practice of placing high-value or sensitive products in a fenced off area within a warehouse. Cage: (1) A secure enclosed area for storing highly valuable items, (2) a pallet-sized platform with sides that can be secured to the tines of a forklift and in which a person may ride to inventory items stored will above the warehouse floor. CAE: See Computer Aided Engineering C Cabotage: A federal law that requires coastal and inter-coastal traffic to be carried in U.S.-built and -registered ships. Calculation: = 4 days, multiply by 1.75 = 5 days, multiply by 1.40 = 6 days, multiply by 1.17 Synonym: Customer Interaction Center Can-order Point: A supplier ordering method where multiple items from the same vendor are considered / reviewed if any one item from that vendor falls below a specific order point (either set or calculated). Once an item triggers an order, any other items which are near their order point are also considered. This is done to prevent multiple orders for a single vendor in a short time frame, allowing for possible price breaks and shipping discounts. Call Center: A call center is a centralized office used for the purpose of receiving and transmitting a large volume of requests by telephone. A call centre is operated by a company to administer incoming product support or information inquiries from consumers. Outgoing calls for telemarketing, clientele, product services, and debt collection are also made. In addition to a call centre, collective handling of letters, faxes, live chat, and e-mails at one location is known as a contact center. CADEX: See Customs Automated Data Exchange System Call Volume: The number of telephone calls made or received over a specific period of time. Call-off Orders: A strategy to delay delivery of items that are not needed immediately. Instead, you “call off” the items from the purchase order you want as you need them. See also: Blanket Purchase Order Definitions compiled by: Kate Vitasek www.scvisions.com CSCMP does not take responsibility for these definitions nor endorses these as official definitions except as noted. Page 27 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated:February2010Cantilever Rack: Racking system that support columns at the rear and arms which attach to the support columnstoholdshelvingorstock.Cantileversracksallowsforstorageofverylongitems.Capable to Promise (cTp):A technique similar to Available-to-Promise, it uses the availability of individualcomponents to determine if an end item can be configured and assembled by a customer-given request date andprovidestheability of adjustingplansdue to inaccuratedelivery date promises.Capable topromise looks at bothmaterialsandlabor/machinerequirements.Capability maturitymodel (cMM): A framework that describes the key elements of an effective software process.It'san evolutionaryimprovementpathfromanimmatureprocesstoamature,disciplinedprocess.TheCMMcoverspractices for planning,engineering and managing software development and maintenance.When followed,thesekeypractices improvetheabilityof organizationstomeetgoalsforcost,schedule,functionalityandproductquality.Capacity: The physical facilities, personnel and process available to meet the product or service needs of customers.Capacitygenerallyreferstothemaximumoutputorproducingabilityofamachine,aperson,aprocess,afactory,aproduct, or a service.Seealso:CapacityManagementCapacity Management:The concept that capacity should be understood, defined,and measured foreach level inthe organization to includemarket segments,products,processes,activities, and resources.In each of theseapplications,capacity is defined in a hierarchy of idle,non-productive, and productive views.Capacity Planning:Assuring that needed resources (e.g.,manufacturing capacity,distribution center capacity,transportation vehicles, etc.) will be available at the right time and place to meet logistics and supply chain needs.CAPEX: A term used to describe the monetary requirements (CAPital EXPenditure) of an initial investment in newmachines or equipment.Capital:Theresources,ormoney,availableforinvesting inassetsthatproduceoutput.CAR:See CorrectiveActionCar supply charge: A railroad charge for a shipper's exclusive use of special equipment.Carbon Footprint:A measure of the total carbon emissions for a given person,organization,building,operationetc.and the impact their carbon emissions haveonthe environmentby relating theamount of greenhousegasesproduced to suchactivitiesas burningfossilfuelsfor electricity,heating transportation,etcCarbonTrade:Theprocess of buying and selling creditsto emit carbon.Companies and organizations areassignedemission permitsthat stand forthe amount of carbon theyareallowed to emit.If a company or organization emitslesscarbon,thenitcan sell itsemissionspermits.If emissionsaremorethan itscurrentpermits,then itwill needtobuy emissionpermits from othercompanies ororganizationsthatproduceless carbon.Delfinitions compiled by:KateVitasekwww.scvisions.comCSCMPdoes not take responsibilityforthesedefirnoFsofficialdefinitionsexceptasnotedPage 28 of 212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Car supply charge: A railroad charge for a shipper's exclusive use of special equipment. Capital: The resources, or money, available for investing in assets that produce output. CAPEX: A term used to describe the monetary requirements (CAPital EXPenditure) of an initial investment in new machines or equipment. Capacity Planning: Assuring that needed resources (e.g., manufacturing capacity, distribution center capacity, transportation vehicles, etc.) will be available at the right time and place to meet logistics and supply chain needs. Capacity Management: The concept that capacity should be understood, defined, and measured for each level in the organization to include market segments, products, processes, activities, and resources. In each of these applications, capacity is defined in a hierarchy of idle, non-productive, and productive views. Capacity: The physical facilities, personnel and process available to meet the product or service needs of customers. Capacity generally refers to the maximum output or producing ability of a machine, a person, a process, a factory, a product, or a service. See also: Capacity Management Capability maturity model (CMM): A framework that describes the key elements of an effective software process. It's an evolutionary improvement path from an immature process to a mature, disciplined process. The CMM covers practices for planning, engineering and managing software development and maintenance. When followed, these key practices improve the ability of organizations to meet goals for cost, schedule, functionality and product quality. Capable to Promise (CTP): A technique similar to Available-to-Promise, it uses the availability of individual components to determine if an end item can be configured and assembled by a customer-given request date and provides the ability of adjusting plans due to inaccurate delivery date promises. Capable to promise looks at both materials and labor/machine requirements. Cantilever Rack: Racking system that support columns at the rear and arms which attach to the support columns to hold shelving or stock. Cantilevers racks allows for storage of very long items. CAR: See Corrective Action Carbon Footprint: A measure of the total carbon emissions for a given person, organization, building, operation etc. and the impact their carbon emissions have on the environment by relating the amount of greenhouse gases produced to such activities as burning fossil fuels for electricity, heating transportation, etc. Carbon Trade: The process of buying and selling credits to emit carbon. Companies and organizations are assigned emission permits that stand for the amount of carbon they are allowed to emit. If a company or organization emits less carbon, then it can sell its emissions permits. If emissions are more than its current permits, then it will need to buy emission permits from other companies or organizations that produce less carbon. Definitions compiled by: Kate Vitasek www.scvisions.com CSCMP does not take responsibility for these definitions nor endorses these as official definitions except as noted. Page 28 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated: February2010Cargo: subject of a shipment. The materials being carried.Carload Lot:Ashipmentof not less than five tons of one commodityCarmackAmendment:AnInterstateCommerce Actamendmentthatdelineates the liabilityof common carriersand the bill of lading provision.Carousel:Automated warehousing equipment generally used for picking of small and high-volume parts/pieces.Carrier: A firm which transports goods or people via land, sea or air.Cartel:A group of organizations which would normally be considered competitive, but who instead have anagreement to cooperate in an area of endeavor in an effort to improve the position of the group.Cartonization: The process of putting small box shipments into a lager carton,also called over packing or strappingcases together.Cascade Tendering: Loads are electronically submitted to the carrier who submitted the lowest rate on thatshipping lane(originzip codetodestinationzipcode)Case Code: The UPC number for a case of product. The UPC case code is different from the UPC item code becauseit uses the case identifier as an extended part of the number.This is sometimes referred to as the ShippingContainerSymbol"orITF-14 code.Cash-to-Cash Cycle Time: The time it takes for cash to flow back into a company after it has been spent for rawmaterials.Synonym:CashConversionCycleTotal Inventory Days of Supply +Calculation:Daysof SalesOutstandingAveragePayment Period forMaterial in DaysThis is a measure of when the financial transaction occurs, not when stock movement happens.Note:Thereare occasionswhereC2C isnegative,indicatingthatpayment is receivedfromsalesof theproduct before the supplier is paid.Cash Conversion Cycle:Typically the length of time from the purchase of raw materials to the collection ofpaymentfromcustomers.Inretail settings itmayrefertothelengthof timefrom salestopayment receipt.Seealso:Cash-to-CashCycleTimeCatalogChannel:A call center ororder processingfacilitythat receives orders directlyfromthe customerbased ordefinedcatalogofferingsandshipsdirectlytothecustomer.Definitions compiled byKateVitasekwww.scvIsions.concSCMPdoesnattaeonsibilityforttcialdoept as notedoet山Page 29 of 212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Note: This is a measure of when the financial transaction occurs, not when stock movement happens. There are occasions where C2C is negative, indicating that payment is received from sales of the product before the supplier is paid. Carmack Amendment: An Interstate Commerce Act amendment that delineates the liability of common carriers and the bill of lading provision. Carload Lot: A shipment of not less than five tons of one commodity. Cargo: subject of a shipment. The materials being carried. Cash Conversion Cycle: Typically the length of time from the purchase of raw materials to the collection of payment from customers. In retail settings it may refer to the length of time from sales to payment receipt. Catalog Channel: A call center or order processing facility that receives orders directly from the customer based on defined catalog offerings and ships directly to the customer. See also: Cash-to-Cash Cycle Time Carousel: Automated warehousing equipment generally used for picking of small and high-volume parts/pieces. Synonym: Cash Conversion Cycle Calculation: Total Inventory Days of Supply + Days of Sales Outstanding - Average Payment Period for Material in Days Cartel: A group of organizations which would normally be considered competitive, but who instead have an agreement to cooperate in an area of endeavor in an effort to improve the position of the group. Carrier: A firm which transports goods or people via land, sea or air. Cash-to-Cash Cycle Time: The time it takes for cash to flow back into a company after it has been spent for raw materials. Case Code: The UPC number for a case of product. The UPC case code is different from the UPC item code because it uses the case identifier as an extended part of the number. This is sometimes referred to as the "Shipping Container Symbol" or ITF-14 code. Cartonization: The process of putting small box shipments into a lager carton, also called over packing or strapping cases together. Cascade Tendering: Loads are electronically submitted to the carrier who submitted the lowest rate on that shipping lane (origin zip code to destination zip code) Definitions compiled by: Kate Vitasek www.scvisions.com CSCMP does not take responsibility for these definitions nor endorses these as official definitions except as noted. Page 29 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated:February2010Catalog Item (cI):The item as it is stored in a catalog or data pool.In theGlobal Data Synchronization Networkthe catalog item is uniquely identified by (GTIN + GLN + Target Market).Categorical Plan: A method of categorizing purchased materials and suppliers based on product type, usingdepartmentsorfunctionalarea.Plansareusedto evaluatesuppliersingroupsSeealso:Weighted-Point PlanCategory Management:The management of product categories as strategic business units.The practice empowersa category manager with full responsibility for the assortment decisions, inventory levels, shelf-space allocation,promotions and buying. With this authority and responsibility, the category manager is able to judge moreaccuratelytheconsumerbuyingpatterns,product salesandmarkettrendsof that categoryCause and Effect Diagram: In quality management, a structured process used to organize ideas into logicalgroupings. Used in brainstorming and problem solving exercises. Also known as Ishikawa or fish bone diagram.CBP:SeeCustomsand BorderProtectionCBT:See Computer-Based TrainingCell: An area of manufacturing or assembly which consists of a series of work units devoted to the manufacture of aspecific product.Cellular manufacture is an alternativeto the traditional production lineCellular manufacturing: A manufacturing approach in which equipment and workstations are arranged to facilitatesmall-lot,continuous-flow production.Inamanufacturing"cell,"all operations necessary toproducea component orsubassembly are performed in close proximity,thus allowing for quick feedback between operators when qualityproblems and other issues arise. Workers in a manufacturing cell typically are cross-trained and,therefore, able toperform.multiple tasks as needed.Center-of-GravityApproach:A supply chain planning methodologyforlocating distribution centers atapproximately the location representing the minimum transportation costs between the plants,the distributioncenters,and the markets.Centralized Authority: Management authority to make decisions is restricted to few managers.Centralized Dispatching: An organizational strategy and structure where all workflow is controlled from a singlelocation or group.Dispatching can consist of production orders as well as inbound /outbound shipments of goods.Centralized Inventory Control: An organizational strategy and structure where all inventoried items are controlledfrom a single location or group.Certificateof Analysis (coA):A document, often required byan importer or governmental authorities,attestingto the quality or purity of commodities.Definitions compiled by:KateVitasekwww.scvIsions.comcSCMPdoesnottakeresonsibilityforthefficialdefinitcept as notedoePage 30.of 212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Centralized Inventory Control: An organizational strategy and structure where all inventoried items are controlled from a single location or group. Certificate of Analysis (COA): A document, often required by an importer or governmental authorities, attesting to the quality or purity of commodities. Cellular manufacturing: A manufacturing approach in which equipment and workstations are arranged to facilitate small-lot, continuous-flow production. In a manufacturing "cell," all operations necessary to produce a component or subassembly are performed in close proximity, thus allowing for quick feedback between operators when quality problems and other issues arise. Workers in a manufacturing cell typically are cross-trained and, therefore, able to perform multiple tasks as needed. Cell: An area of manufacturing or assembly which consists of a series of work units devoted to the manufacture of a specific product. Cellular manufacture is an alternative to the traditional production line. CBT: See Computer-Based Training See also: Weighted-Point Plan Centralized Authority: Management authority to make decisions is restricted to few managers. Catalog Item (CI): The item as it is stored in a catalog or data pool. In the Global Data Synchronization Network the catalog item is uniquely identified by (GTIN + GLN + Target Market). Cause and Effect Diagram: In quality management, a structured process used to organize ideas into logical groupings. Used in brainstorming and problem solving exercises. Also known as Ishikawa or fish bone diagram. Category Management: The management of product categories as strategic business units. The practice empowers a category manager with full responsibility for the assortment decisions, inventory levels, shelf-space allocation, promotions and buying. With this authority and responsibility, the category manager is able to judge more accurately the consumer buying patterns, product sales and market trends of that category. Categorical Plan: A method of categorizing purchased materials and suppliers based on product type, using departments or functional area. Plans are used to evaluate suppliers in groups. CBP: See Customs and Border Protection Center-of-Gravity Approach: A supply chain planning methodology for locating distribution centers at approximately the location representing the minimum transportation costs between the plants, the distribution centers, and the markets. Centralized Dispatching: An organizational strategy and structure where all workflow is controlled from a single location or group. Dispatching can consist of production orders as well as inbound /outbound shipments of goods. Definitions compiled by: Kate Vitasek www.scvisions.com CSCMP does not take responsibility for these definitions nor endorses these as official definitions except as noted. Page 30 of 212