SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated: February 2010Certificate of Compliance: A document, often required by an importer or governmental authorities, attesting tothequalityorpurityofcommodities.Theoriginofthecertificationmaybeachemistoranyotherauthorizedbodysuchasan inspectionfirmretainedbytheexporterorimporter.Certificateof Origin:An international businessdocument that certifiesthe country of origin of the shipmentCertificate of public convenience and necessity: The grant of operating authority that is given to commoncarriers. A carrier must prove that a public need exists and that the carrier is fit, willing, and able to provide theneeded service. The certificate may specify the commodities to be hauled, the area to be served, and the routes tobe used.Certificated carrier: A for-hire air carrier that is subject to economic regulation and requires an operatingcertification to provide service.Certified Supplier: A supplier who has demonstrated the ability to consistently meet established quality, cost,delivery,financial, and count objectives,and has thereforebeenawarded the"certified"designation.Suppliers in thisgroup may be able to bypass incomingquality inspection.C&F:SeeCost and FreightCFD:See Continuous Flow DistributionCGMP:SeeCurrent GoodManufacturingPracticeChain of Customers:The downstream supply chain in situations where multiple echelons exist such asmanufacturer to distributor to retailer to end user.Chain reaction: A chain of events described by W. Edwards Deming: improve quality, decrease costs, improveproductivity, increase market with better quality and lower price, stay in business, provide jobs and provide morejobs.Challenge and Response:A method of user authentication. The user enters an ID and password and, in return, isissued a challenge bythe system.The system compares the user's response to the challenge to a computedresponse.If the responses match, the user is allowed access to the system.The system issues a different challengeeach time. In effect, it requires a new password for each logon.Champion: A business leader or senior manager who ensures that resources are available for training and projects,and who is involved inproject tollgate reviews;alsoan executive who supports and addresses Six Sigmaorganizational issues.Change Agent:An individual from within or outside an organization who facilitates change within the organization.May or may notbe the initiator of the changeeffort.Definitions compiled by:KateVitasekwww.scvIsIons.coTcSCMPdoesnottakeresfficialdefinitcept as notedonsibilityfortheoe山Page 31 of 212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Change Agent: An individual from within or outside an organization who facilitates change within the organization. May or may not be the initiator of the change effort. Champion: A business leader or senior manager who ensures that resources are available for training and projects, and who is involved in project tollgate reviews; also an executive who supports and addresses Six Sigma organizational issues. CFD: See Continuous Flow Distribution Certificated carrier: A for-hire air carrier that is subject to economic regulation and requires an operating certification to provide service. Certified Supplier: A supplier who has demonstrated the ability to consistently meet established quality, cost, delivery, financial, and count objectives, and has therefore been awarded the “certified” designation. Suppliers in this group may be able to bypass incoming quality inspection. Certificate of public convenience and necessity: The grant of operating authority that is given to common carriers. A carrier must prove that a public need exists and that the carrier is fit, willing, and able to provide the needed service. The certificate may specify the commodities to be hauled, the area to be served, and the routes to be used. Certificate of Origin: An international business document that certifies the country of origin of the shipment. Certificate of Compliance: A document, often required by an importer or governmental authorities, attesting to the quality or purity of commodities. The origin of the certification may be a chemist or any other authorized body such as an inspection firm retained by the exporter or importer. Challenge and Response: A method of user authentication. The user enters an ID and password and, in return, is issued a challenge by the system. The system compares the user's response to the challenge to a computed response. If the responses match, the user is allowed access to the system. The system issues a different challenge each time. In effect, it requires a new password for each logon. Chain reaction: A chain of events described by W. Edwards Deming: improve quality, decrease costs, improve productivity, increase market with better quality and lower price, stay in business, provide jobs and provide more jobs. Chain of Customers: The downstream supply chain in situations where multiple echelons exist such as manufacturer to distributor to retailer to end user. CGMP: See Current Good Manufacturing Practice C&F: See Cost and Freight 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 31 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated: February 2010Change Management: The process of managing and monitoring all changes to products and processes. Changemanagement is typically instituted to avoid risks associated with ad-hoc change, and to ensure a consistent process.Change Order: A document or digital record which authorizes and provides notification of a modification to aproductororder.Changeover: Process of making necessary adjustments to change or switchover the type of products produced on amanufacturing line.Changeovers usually lead to downtime and for the most part companies try to minimizechangeover time to help reduce costs.Channel:1)A method whereby a business dispenses its product, such as a retail or distribution channel, call centeror web based electronic storefront.2)Apush technologythat allows usersto subscribe to a website tobrowseoffline,automatically display updated pages on their screen savers,and download or receive notifications whenpages in the website are modified. Channels are available only in browsers that support channel definitions, such asMicrosoftInternetExplorerversion4.0andabove.Channel Conflict: This occurs when various sales channels within a company's supply chain compete with eachotherfor the same business.An example is where a retail channel is in competitionwith a webbased channel set upbythecompany.Channel Partners: Members of a supply chain (i.e. suppliers, manufacturers, distributors, retailers, etc.) who workin conjunction with one another to manufacture,distribute, and sell a specific product.Channels of Distribution:The downstream flow of products through various outlets or"channelswhich mayconsist of distributors,retail stores, on-line fulfillment, etc.See also:Distribution ChannelChargeback Provisions:Terms within a contract whichgovern howa company can charge a supplier for failure toperform agreed upon required activities.Charging area:A warehouse area where a company maintains battery chargers and extra batteries to support afleet of electrically powered materials handling equipment. The company must maintain this area in accordance withgovernmentsafetyregulations.Chock: A wedge, usually made of hard rubber or steel, that is firmly placed under the wheel of a trailer, truck, orboxcar to stop it from rolling.Churning: The practice of customers switching to another supplier based on special discount offers. Particularlyused in the cellular telephone or credit card industries. Sometimes this term is applied to supplier managementwhere a practice of choosing the low price vendor is emphasized over maintaining strategic relationships.CI:SeeCatalogItemDefinitions compiled by:KateVitaselwww.scvIsIons.cocSCMPdoesnottakeresponsibilityforthefficialdefinitceptasnotedPage32of212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Churning: The practice of customers switching to another supplier based on special discount offers. Particularly used in the cellular telephone or credit card industries. Sometimes this term is applied to supplier management where a practice of choosing the low price vendor is emphasized over maintaining strategic relationships. CI: See Catalog Item Chock: A wedge, usually made of hard rubber or steel, that is firmly placed under the wheel of a trailer, truck, or boxcar to stop it from rolling. Charging area: A warehouse area where a company maintains battery chargers and extra batteries to support a fleet of electrically powered materials handling equipment. The company must maintain this area in accordance with government safety regulations. Channels of Distribution: The downstream flow of products through various outlets or ‘channels’ which may consist of distributors, retail stores, on-line fulfillment, etc. Channel Partners: Members of a supply chain (i.e. suppliers, manufacturers, distributors, retailers, etc.) who work in conjunction with one another to manufacture, distribute, and sell a specific product. Chargeback Provisions: Terms within a contract which govern how a company can charge a supplier for failure to perform agreed upon required activities. Channel Conflict: This occurs when various sales channels within a company's supply chain compete with each other for the same business. An example is where a retail channel is in competition with a web based channel set up by the company. See also: Distribution Channel Channel: 1) A method whereby a business dispenses its product, such as a retail or distribution channel, call center or web based electronic storefront. 2) A push technology that allows users to subscribe to a website to browse offline, automatically display updated pages on their screen savers, and download or receive notifications when pages in the website are modified. Channels are available only in browsers that support channel definitions, such as Microsoft Internet Explorer version 4.0 and above. Changeover: Process of making necessary adjustments to change or switchover the type of products produced on a manufacturing line. Changeovers usually lead to downtime and for the most part companies try to minimize changeover time to help reduce costs. Change Order: A document or digital record which authorizes and provides notification of a modification to a product or order. Change Management: The process of managing and monitoring all changes to products and processes. Change management is typically instituted to avoid risks associated with ad-hoc change, and to ensure a consistent process. 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 32 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated: February 2010CI:See Continuous ImprovementCIF: See Cost, Insurance, FreightCitydriver:Amotorcarrierdriverwhodrivesa local routeas opposed toa long-distance,intercity routeCivil AeronauticsBoard:A federal regulatory agency that implemented economic regulatory controls over aircarriers.CL: Carload rail service requiring shipper to meet minimum weight.Claim: A charge made against a carrier for loss, damage,delay,or overchargeClass I carrier: A classification of regulated carriers based upon annual operating revenues-motor carriers ofproperty:> or =$5 million; railroads:>or =$50 million; motor carriers of passengers:> or =$3 million.Class II carrier:A classification of regulated carriers based upon annual operating revenues-motor carriers ofproperty:$1-$5 million; railroads:$10-$5omillion; motor carriersof passengers:<or=$3million.Class III carrier: A classification of regulated carriers based upon annual operating revenues-motor carriers ofproperty: < or = $1 million; railroads: < or = $10 million.Class Rate:Arate constructed from a classification and a uniform distance system.Aclass rate is available for anyproduct between any two points.Classification: An alphabetical listing of commodities, the class or rating into which the commodity is placed, andthe minimumweight necessaryfor the rate discount; used in the class rate structure.Classification yard: A railroad terminal area where rail cars are grouped together to form train units.CLA:SeeClosed-loopcorrectiveactionClearinghouse: A conventional or limited purpose entity generally restricted to providing specialized services, suchas clearing funds or settling accounts.Click-and-Mortar:With reference to a traditional brick-and-mortar company that has expanded its presence onlineManybrick-and-mortar stores are nowtrying to establish an onlinepresencebut often havea difficult timedoing sofor many reasons.Click-and-mortar is"the successful combination of online and real world experience."CLIN:SeeContractLineItems NumberDefinitions compiled by:KateVitasekwww.scvIsIons.concSCMPdoesaottaeecialdoept as notedonsibilityforthoe山Page 33 of 212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT CLIN: See Contract Line Items Number CLCA: See Closed-loop corrective action Click-and-Mortar: With reference to a traditional brick-and-mortar company that has expanded its presence online. Many brick-and-mortar stores are now trying to establish an online presence but often have a difficult time doing so for many reasons. Click-and-mortar is "the successful combination of online and real world experience." Clearinghouse: A conventional or limited purpose entity generally restricted to providing specialized services, such as clearing funds or settling accounts. Class Rate: A rate constructed from a classification and a uniform distance system. A class rate is available for any product between any two points. Classification yard: A railroad terminal area where rail cars are grouped together to form train units. Classification: An alphabetical listing of commodities, the class or rating into which the commodity is placed, and the minimum weight necessary for the rate discount; used in the class rate structure. Class III carrier: A classification of regulated carriers based upon annual operating revenues-motor carriers of property: < or = $1 million; railroads: < or = $10 million. Class II carrier: A classification of regulated carriers based upon annual operating revenues-motor carriers of property: $1-$5 million; railroads: $10-$50 million; motor carriers of passengers: < or = $3 million. Class I carrier: A classification of regulated carriers based upon annual operating revenues-motor carriers of property: > or = $5 million; railroads: > or =$50 million; motor carriers of passengers: > or =$3 million. Claim: A charge made against a carrier for loss, damage, delay, or overcharge. CL: Carload rail service requiring shipper to meet minimum weight. Civil Aeronautics Board: A federal regulatory agency that implemented economic regulatory controls over air carriers. City driver: A motor carrier driver who drives a local route as opposed to a long-distance, intercity route. CIF: See Cost, Insurance, Freight CI: See Continuous Improvement 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 33 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated: February 2010Clip Art: A collection of icons, buttons,and other useful image files, along with sound and video files that can beinsertedintodocuments/webpages.Clipboard:A temporary storage area on a computer for cut or copied itemsCLM:SeeCouncilofSupplyChainManagementProfessionalsClosed-loop Corrective Action (CLCA): A sophisticated engineering system designed to document, verify anddiagnose failures,recommend and initiatecorrective action,provide follow-up and maintain comprehensivestatistical records.Closed-loop MRp: A production and operations environment which manages materials and production processesthrough a full closed loop cycle beginning with planning, proceeding through the execution process, and providinganyresultingfeedbackandcorrectiveactionsbacktotheplanningfunctiontovalidateand improvefutureprocesses.Cloud Computing:An emerging computing paradigm wheredata and services reside in massively scalable datacenters and can be ubiquitously accesses from any connected devices over the internet.Similar to the"on demandconceptofSaaSorASPcomputingserviceswiththeexceptionofthebroadnatureofthenetworkofcomputers.CLS: See Contractor Logistics SupportCluster Picking: Cluster picking is a methodology of picking into multiple order containers at one time. Thecontainers could be totes containing orderbatches,discrete order shippers, or discrete ordertotes.CM:See Credit MemoCMI: See Co-Managed InventoryCMM: See Capability Maturity ModelCMMS:SeeComputerizedMaintenanceManagementSystemcoA:SeeCertificateofAnalysisCoastal carriers:Water carriers that provide service along coasts serving ports on the Atlantic or Pacific oceans oron the Gulf of Mexico.Co-destiny: A concept that begins with the idea of long term buyer-supplier relationships and assumes thatorganizations are uniquely and in most cases inextricably tied to their suppliers and customers.Co-Packer:A contract co-packer produces goods and/or services for other companies,usuallyunder the othercompany'slabelorname.Co-Packersaremorefrequentlyseen inCPGandFoods.Delfinitions compiled by:Kate Vitasekwww.scvisions.conmcSCMPdoesnottakeonsibilityforcialdoneptasnotedoet山Page34of212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Cluster Picking: Cluster picking is a methodology of picking into multiple order containers at one time. The containers could be totes containing order batches, discrete order shippers, or discrete order totes. CMMS: See Computerized Maintenance Management System CLS: See Contractor Logistics Support Co-Packer: A contract co-packer produces goods and/or services for other companies, usually under the other company's label or name. Co-Packers are more frequently seen in CPG and Foods. Co-destiny: A concept that begins with the idea of long term buyer-supplier relationships and assumes that organizations are uniquely and in most cases inextricably tied to their suppliers and customers. Coastal carriers: Water carriers that provide service along coasts serving ports on the Atlantic or Pacific oceans or on the Gulf of Mexico. COA: See Certificate of Analysis CMM: See Capability Maturity Model CMI: See Co-Managed Inventory Closed-loop MRP: A production and operations environment which manages materials and production processes through a full closed loop cycle beginning with planning, proceeding through the execution process, and providing any resulting feedback and corrective actions back to the planning function to validate and improve future processes. CLM: See Council of Supply Chain Management Professionals Cloud Computing: An emerging computing paradigm where data and services reside in massively scalable data centers and can be ubiquitously accesses from any connected devices over the internet. Similar to the “on demand” concept of SaaS or ASP computing services with the exception of the broad nature of the network of computers. CM: See Credit Memo Clipboard: A temporary storage area on a computer for cut or copied items. Closed-loop Corrective Action (CLCA): A sophisticated engineering system designed to document, verify and diagnose failures, recommend and initiate corrective action, provide follow-up and maintain comprehensive statistical records. Clip Art: A collection of icons, buttons, and other useful image files, along with sound and video files that can be inserted into documents/web pages. 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 34 of 212
SUPPLYCHAINMANAGEMENTTERMSandGLOSSARYUpdated: February 2010Co-Managed Inventory (cMi):Aform of continuous replenishment in which themanufacturer is responsible forreplenishment of standard merchandise,while theretailermanages the replenishment of promotionalmerchandise.Code:Anumeric,oralphanumeric,representation of text forexchanging commonly used information.Forexample:commoditycodes,carriercodes,Codifying:Theprocessof detailinganewstandard.coGS: See Cost of Goods SoldCollaboration: Joint work and communication among people and systems - including business partners, suppliers,andcustomers-toachieveacommonbusinessgoal.Collaborative Planning, Forecasting and Replenishment (CPFR): A concept that aims to enhance supplychain integration by supporting and assisting joint practices. CPFR seeks cooperative management of inventorythrough joint visibility and replenishment of products throughout the supply chain. Information shared betweensuppliers and retailers aids in planning and satisfying customer demands through a supportive system of sharedinformation.This allows for continuous updating of inventory and upcoming requirements,essentially making theend-to-end supply chain processmore efficient.Efficiencyis also created through thedecrease expenditures formerchandising,inventory,logistics,and transportation across all trading partners.Collect Freight: Freight payable to the carrier at the port of discharge or ultimate destination.The consignee doesnot pay the freight charge if the cargo does not arrive at the destination.CombinedLeadTime:SeeCumulativeLeadTimeCommercial Invoice: A document created by the seller. It is an official document which is used to indicate, amongother things,the name and address of the buyer and seller,the product(s) being shipped, and their value forcustoms, insurance,or other purposes.Commercial-off-the-Shelf(coTs):Acomputer software industryterm which describes softwareofferedfor saleby commercial developers.This includes products from vendors such as SAp,Oracle,Microsoft,etc.,as well as fromsmallervendors.Commercial Zone: The area surrounding a city or town to which rates quoted for the city or town also apply; theareaisdefinedbytheICC.Committed Capability:The level of operational capability which is currently either part of a planned schedule or isin actual use.Committee of American Steamship Lines: An industry association representing subsidized U.S. Flag steamshipfirms.Delfinitions compiled by:KateVitasekwww.scvisions.comCSCMPdoesnottakeresponsibilityforthefficialdefiniticept as notedoet山Page35of212
Updated: February 2010 TERMS and GLOSSARY SUPPLY CHAIN MANAGEMENT Committed Capability: The level of operational capability which is currently either part of a planned schedule or is in actual use. Committee of American Steamship Lines: An industry association representing subsidized U.S. Flag steamship firms. Commercial Zone: The area surrounding a city or town to which rates quoted for the city or town also apply; the area is defined by the ICC. Combined Lead Time: See Cumulative Lead Time Collaborative Planning, Forecasting and Replenishment (CPFR®): A concept that aims to enhance supply chain integration by supporting and assisting joint practices. CPFR seeks cooperative management of inventory through joint visibility and replenishment of products throughout the supply chain. Information shared between suppliers and retailers aids in planning and satisfying customer demands through a supportive system of shared information. This allows for continuous updating of inventory and upcoming requirements, essentially making the end-to-end supply chain process more efficient. Efficiency is also created through the decrease expenditures for merchandising, inventory, logistics, and transportation across all trading partners. Collaboration: Joint work and communication among people and systems - including business partners, suppliers, and customers - to achieve a common business goal. Collect Freight: Freight payable to the carrier at the port of discharge or ultimate destination. The consignee does not pay the freight charge if the cargo does not arrive at the destination. Commercial Invoice: A document created by the seller. It is an official document which is used to indicate, among other things, the name and address of the buyer and seller, the product(s) being shipped, and their value for customs, insurance, or other purposes. Commercial-off-the-Shelf (COTS): A computer software industry term which describes software offered for sale by commercial developers. This includes products from vendors such as SAP, Oracle, Microsoft, etc., as well as from smaller vendors. COGS: See Cost of Goods Sold Codifying: The process of detailing a new standard. Code: A numeric, or alphanumeric, representation of text for exchanging commonly used information. For example: commodity codes, carrier codes, Co-Managed Inventory (CMI): A form of continuous replenishment in which the manufacturer is responsible for replenishment of standard merchandise, while the retailer manages the replenishment of promotional merchandise. 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 35 of 212