SUPPLY CHAIN VISION LOGISTICS TERMS and GLOSSARY Updated October 2003 Actual Demand demand is composed of customer orders(and often allocations of materials to production or distribution). Actual demand nets against or consumes"the forecast, depending upon the rules chosen over a time horizon. For example, actual demand will totally replace forecast inside the sold-out customer order backlog horizon (often called the demand time fence), but will net against the forecast outside this horizon based on the chosen forecast consumption rule Actual to Theoretical Cycle Time: The ratio of the measured time required to produce a given output divided by the sum of the time required to produce a given output based on the rated efficiency of the machinery and labor operations Adaptive Control: 1) The ability of a control system to change its own parameters in response to a measured change in operating conditions. 2) Machine control units in which feeds and/or speeds are not fixed. The control unit, working from feedback sensors, is able to optimize favorable situations by automatically increasing or decreasing the machining parameters. This process ensures optimum tool life or surface finish and/or machining costs or production rates Adaptive Smoothing: In forecasting, a form of exponential smoothing in which the smoothing constant is automatically adjusted as a function of forecast error measurement Advance Material Request: Ordering materials before the release of the formal product design This early release is required because of long lead times Advanced Planning and Scheduling(APS): Techniques that deal with analysis and planning of gistics and manufacturing over the short, intermediate, and long-term time periods. APS describes any computer program that uses advanced mathematical algorithms or logic to perform optimization or simulation on finite capacity scheduling, sourcing, capital planning, resource planning, forecasting, demand management, and others. These techniques simultaneously consider a range of constraints and business rules to provide real time planning and scheduling, decision support, available-to-promise, and capable-to-promise capabilities. APS often generates and evaluates multiple scenarios. Management then selects one scenario to use as the official plan. The five main components of APS systems are demand planning, productio planning, production scheduling, distribution planning, and transportation planning Advanced Shipping Notice(AsN): detailed shipment information transmitted to a customer or consignee in advance of delivery, designating the contents (individual products and quantities of each) and nature of the shipment. May also include carrier and shipment specifics including time of shipment and expected time of arrival. See also: Assumed receipt Definitions compiled by Kate vitasek Bellevue. Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted
SUPPLY CHAIN VISIONS LOGISTICS TERMS and GLOSSARY Updated October 2003 Definitions compiled by: Kate Vitasek Supply Chain Visions Bellevue, Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted. Actual Demand: Actual demand is composed of customer orders (and often allocations of items, ingredients, or raw materials to production or distribution). Actual demand nets against or “consumes” the forecast, depending upon the rules chosen over a time horizon. For example, actual demand will totally replace forecast inside the sold-out customer order backlog horizon (often called the demand time fence), but will net against the forecast outside this horizon based on the chosen forecast consumption rule. Actual to Theoretical Cycle Time: The ratio of the measured time required to produce a given output divided by the sum of the time required to produce a given output based on the rated efficiency of the machinery and labor operations. Adaptive Control: 1) The ability of a control system to change its own parameters in response to a measured change in operating conditions. 2) Machine control units in which feeds and/or speeds are not fixed. The control unit, working from feedback sensors, is able to optimize favorable situations by automatically increasing or decreasing the machining parameters. This process ensures optimum tool life or surface finish and/or machining costs or production rates. Adaptive Smoothing: In forecasting, a form of exponential smoothing in which the smoothing constant is automatically adjusted as a function of forecast error measurement. Advance Material Request: Ordering materials before the release of the formal product design. This early release is required because of long lead times. Advanced Planning and Scheduling (APS): Techniques that deal with analysis and planning of logistics and manufacturing over the short, intermediate, and long-term time periods. APS describes any computer program that uses advanced mathematical algorithms or logic to perform optimization or simulation on finite capacity scheduling, sourcing, capital planning, resource planning, forecasting, demand management, and others. These techniques simultaneously consider a range of constraints and business rules to provide real-time planning and scheduling, decision support, available-to-promise, and capable-to-promise capabilities. APS often generates and evaluates multiple scenarios. Management then selects one scenario to use as the "official plan." The five main components of APS systems are demand planning, production planning, production scheduling, distribution planning, and transportation planning. Advanced Shipping Notice (ASN): Detailed shipment information transmitted to a customer or consignee in advance of delivery, designating the contents (individual products and quantities of each) and nature of the shipment. May also include carrier and shipment specifics including time of shipment and expected time of arrival. See also: Assumed Receipt
SUPPLY CHAIN VISION LOGISTICS TERMS and GLOSSARY Updated October 2003 After-Sale Service: Services provided to the customer after products have been delivered. This can include repairs, maintenance and/or telephone support. Synonym: Field Service Aggregate Forecast: An estimate of sales, often time phased, for a grouping of products or product families produced by a facility or firm. Stated in terms of units, dollars, or both, the aggregate forecast is used for sales and production planning (or for sales and operations planning)purposes. Aggregate Inventory: The inventory for any grouping of items or products involving multiple stockkeeping units. Also see: Base Inventory Level. Aggregate Inventory Management: Establishing the overall level(dollar value) of inventory desired and implementing controls to achieve this goal Aggregate Plan: A plan that includes budgeted levels of finished goods, inventory, production backlogs, and changes in the workforce to support the production strategy. Aggregated information(e.g, product line, family) rather than product information is used, hence the name aggregate plan ggregate Planning: A process to develop tactical plans to support the organizations business plan. Aggregate planning usually includes the development, analysis, and maintenance of plans for total sales, total production, targeted inventory, and targeted customer backlog for families of products. The production plan is the result of the aggregate planning process. Two approaches to aggregate planning exist-production planning and sales and operations planning Agility: The ability to successfully manufacture and market a broad range of low-cost, high quality products and services with short lead times and varying volumes that provides enhanced value to customers through customization. Agility merges the four distinctive competencies of cost, quality, dependability, and flexibility AGVS: See: Automated Guided vehicle system Algorithm: A clearly specified mathematical process fr computation; a set of rules, which, if followed give a prescribed result Allocated item: In an MRP system, an item for which a picking order has been released to the stockroom but not yet sent from the stockroom Allocation: A distribution of costs using calculations that may be unrelated to physical or direct or repeatable cause-and-effect relationships. Because of the arbitrary nature of allocations, costs based on cost causal assignment are viewed as more relevant for management decision- making.(Contrast with Tracing and Assignment. Definitions compiled by Kate vitasek aIn Bellevue. Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted
SUPPLY CHAIN VISIONS LOGISTICS TERMS and GLOSSARY Updated October 2003 Definitions compiled by: Kate Vitasek Supply Chain Visions Bellevue, Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted. After-Sale Service: Services provided to the customer after products have been delivered. This can include repairs, maintenance and/or telephone support. Synonym: Field Service. Aggregate Forecast: An estimate of sales, often time phased, for a grouping of products or product families produced by a facility or firm. Stated in terms of units, dollars, or both, the aggregate forecast is used for sales and production planning (or for sales and operations planning) purposes. Aggregate Inventory: The inventory for any grouping of items or products involving multiple stockkeeping units. Also see: Base Inventory Level. Aggregate Inventory Management: Establishing the overall level (dollar value) of inventory desired and implementing controls to achieve this goal. Aggregate Plan: A plan that includes budgeted levels of finished goods, inventory, production backlogs, and changes in the workforce to support the production strategy. Aggregated information (e.g., product line, family) rather than product information is used, hence the name aggregate plan. Aggregate Planning: A process to develop tactical plans to support the organization’s business plan. Aggregate planning usually includes the development, analysis, and maintenance of plans for total sales, total production, targeted inventory, and targeted customer backlog for families of products. The production plan is the result of the aggregate planning process. Two approaches to aggregate planning exist—production planning and sales and operations planning. Agility: The ability to successfully manufacture and market a broad range of low-cost, highquality products and services with short lead times and varying volumes that provides enhanced value to customers through customization. Agility merges the four distinctive competencies of cost, quality, dependability, and flexibility. AGVS: See: Automated Guided Vehicle System. Algorithm: A clearly specified mathematical process for computation; a set of rules, which, if followed, give a prescribed result. Allocated item: In an MRP system, an item for which a picking order has been released to the stockroom but not yet sent from the stockroom. Allocation: A distribution of costs using calculations that may be unrelated to physical observations or direct or repeatable cause-and-effect relationships. Because of the arbitrary nature of allocations, costs based on cost causal assignment are viewed as more relevant for management decision-making. (Contrast with Tracing and Assignment.)
SUPPLY CHAIN VISION LOGISTICS TERMS and GLOSSARY Updated October 2003 Allocation Costing: See Absorption Costing Alternate Routing: A routing, usually less preferred than the primary routing, but resulting in an identical item. Alternate routings may be maintained in the computer or off- line via manu methods, but the computer software must be able to accept alternate routings for specific jobs American National Standards Institute(ANSI): A non-profit organization chartered to develop, maintain, and promulgate voluntary U.S. national standards in a number of areas, especially with regards to setting EDI standards. ANSI is the U.s. representative to the International Standards Organization(IsO) American Society for Quality (ASQ): Founded in 1946, a not-for-profit educational organization with 144,000 members who are interested in quality improvement American Standard Code for Information Interchange(ASCID: ASCII format- simple text based data with no formatting. The standard code for information exchange among data processing systems. Uses a coded character set consisting of 7-bit coded characters(8 bits including parity check) displayed in rapid sequence by some Web browsers, giving an animated effect. Also see: IAre Animated GIF: A file containing a series of GIF( Graphics Interchange Format)images that ANSI: See american national standards Institute ANSI ASC X12: American National Standards Institute Accredited Standards Committee X12 The committee of ansi that is charted with setting edi standards ANSI Standard: A published transaction set approved by aNsI. The standards are reviewed every siX months Anticipated Delay Report: A report, normally issued by both manufacturing and purchasing to the material planning function, regarding jobs or purchase orders that will not be completed on time and explaining why the jobs or purchases are delayed and when they will be completed This report is an essential ingredient of the closed-loop MRP system. It is normally a handwritten report. Synonym: delay report Anticipation Inventories: Additional inventory above basic pipeline stock to cover projected trends of increasing sales, planned sales promotion programs, seasonal fluctuations, plant shutdowns and vacations A/P: See Accounts Payable Definitions compiled by Kate vitasek Bellevue. Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted
SUPPLY CHAIN VISIONS LOGISTICS TERMS and GLOSSARY Updated October 2003 Definitions compiled by: Kate Vitasek Supply Chain Visions Bellevue, Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted. Allocation Costing: See Absorption Costing Alternate Routing: A routing, usually less preferred than the primary routing, but resulting in an identical item. Alternate routings may be maintained in the computer or off-line via manual methods, but the computer software must be able to accept alternate routings for specific jobs. American National Standards Institute (ANSI): A non-profit organization chartered to develop, maintain, and promulgate voluntary U.S. national standards in a number of areas, especially with regards to setting EDI standards. ANSI is the U.S. representative to the International Standards Organization (ISO). American Society for Quality (ASQ): Founded in 1946, a not-for-profit educational organization with 144,000 members who are interested in quality improvement. American Standard Code for Information Interchange (ASCII): ASCII format - simple text based data with no formatting. The standard code for information exchange among data processing systems. Uses a coded character set consisting of 7-bit coded characters (8 bits including parity check). Animated GIF: A file containing a series of GIF (Graphics Interchange Format) images that are displayed in rapid sequence by some Web browsers, giving an animated effect. Also see: GIF. ANSI: See American National Standards Institute. ANSI ASC X12: American National Standards Institute Accredited Standards Committee X12. The committee of ANSI that is charted with setting EDI standards. ANSI Standard: A published transaction set approved by ANSI. The standards are reviewed every six months. Anticipated Delay Report: A report, normally issued by both manufacturing and purchasing to the material planning function, regarding jobs or purchase orders that will not be completed on time and explaining why the jobs or purchases are delayed and when they will be completed. This report is an essential ingredient of the closed-loop MRP system. It is normally a handwritten report. Synonym: delay report. Anticipation Inventories: Additional inventory above basic pipeline stock to cover projected trends of increasing sales, planned sales promotion programs, seasonal fluctuations, plant shutdowns, and vacations. A/P: See Accounts Payable
SUPPLY CHAIN VISION LOGISTICS TERMS and GLOSSARY Updated October 2003 Application Service Provider(ASP): A company that offers access over the Internet to application(examples of applications include word processors, database programs, Web browsers, development tools, communication programs) and related services that would otherwise have to be located in their own computers. Sometimes referred to as quot; apps-on- tap", ASP services are expected to become an important alternative, especially for smaller companies with low budgets for information technology. The purpose is to try to reduce a company's burden by installing, managing, and maintaining software Application-to-Application: The direct interchange of data between computers, without re- eying Appraisal Costs: Those costs associated with the formal evaluation and audit of quality in the firm. Typical costs include inspection, quality audits, testing, calibration, and checking time APS: See Advanced Planning and Scheduling AQL: See Acceptable quality level A/R: See accounts receivable ASC: See Accredited Standards Committee ofANSI ASC X12: Accredited Standards Committee X12. A committee of anSi chartered in 1979 to develop uniform standards for the electronic interchange of business documents ASCII: See American Standard Code for Information Interchange ASN: See Advanced Shipping Notice ASP: See Application Service Provider ASQ: See American Society for Quality AS/RS: See Automated Storage and Retrieval System Definitions compiled by Kate vitasek Bellevue. Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted
SUPPLY CHAIN VISIONS LOGISTICS TERMS and GLOSSARY Updated October 2003 Definitions compiled by: Kate Vitasek Supply Chain Visions Bellevue, Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted. Application Service Provider (ASP): A company that offers access over the Internet to application (examples of applications include word processors, database programs, Web browsers, development tools, communication programs) and related services that would otherwise have to be located in their own computers. Sometimes referred to as & quot;apps-ontap", ASP services are expected to become an important alternative, especially for smaller companies with low budgets for information technology. The purpose is to try to reduce a company's burden by installing, managing, and maintaining software. Application-to-Application: The direct interchange of data between computers, without rekeying. Appraisal Costs: Those costs associated with the formal evaluation and audit of quality in the firm. Typical costs include inspection, quality audits, testing, calibration, and checking time. APS: See Advanced Planning and Scheduling AQL: See Acceptable Quality Level A/R: See Accounts Receivable ASC: See Accredited Standards Committee of ANSI. ASC X12: Accredited Standards Committee X12. A committee of ANSI chartered in 1979 to develop uniform standards for the electronic interchange of business documents. ASCII: See American Standard Code for Information Interchange ASN: See Advanced Shipping Notice. ASP: See Application Service Provider ASQ: See American Society for Quality AS/RS: See Automated Storage and Retrieval System
SUPPLY CHAIN VISION LOGISTICS TERMS and GLOSSARY Updated October 2 Assemble-to-order: A production environment where a good or service can be assembled after receipt of a customers order. The key components(bulk, semi-finished, intermediate, subassembly, fabricated, purchased, packing, and so on) used in the assembly or finishing process are planned and usually stocked in anticipation of a customer order. Receipt of an order initiates assembly of the customized product. This strategy is useful where a large number of end products( based on the selection of options and accessories)can be assembled from common components. Synonym: finish-to-order. Also see: Make-to-Order, Make-to-Stock Assembly: A group of subassemblies and/or parts that are put together and that constitute a major subdivision for the final product. An assembly may be an end item or a component of a higher level assembly Assembly Line: An assembly process in which equipment and work centers are laid out to follow the sequence in which raw materials and parts are assembled Assignment: a distribution of costs using causal relationships. Because cost causal relationships are viewed as more relevant for management decision- making, nt of costs is generally preferable to allocation techniques. (Synonymous with Tracing. Contrast with Allocation) Assumed Receipt: The principle of assuming that the contents of a shipping or delivery note are correct. Shipping and receiving personnel do not check the delivery quantity. Usedin conjunction with bar codes and an EDI-delivered asn to eliminate invoices ATP: See available to promise ATS: See available to sell Attachment: An accessory that has to be physically attached to the product. Attributes: A label used to provide additional classification or information about a resource, activity, or cost object. Used for focusing attention and may be subjective. Examples are a characteristic, a score or grade of product or activity, or groupings of these items, and performance measures Audit Trail: Manual or computerized tracing of the transactions affecting the contents or origin of a record Auditability: A characteristic of modern information systems, gauged by the ease with which data can be substantiated by trading it to source documents and the extent to which auditors can rely on pre-verified and monitored control processes Definitions compiled by Kate vitasek Bellevue. Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted
SUPPLY CHAIN VISIONS LOGISTICS TERMS and GLOSSARY Updated October 2003 Definitions compiled by: Kate Vitasek Supply Chain Visions Bellevue, Washington Please note: The Council of Logistics Management does not take responsibility for the content of these definitions, nor does the Council endorse these as official definitions except as noted. Assemble-to-order: A production environment where a good or service can be assembled after receipt of a customer's order. The key components (bulk, semi-finished, intermediate, subassembly, fabricated, purchased, packing, and so on) used in the assembly or finishing process are planned and usually stocked in anticipation of a customer order. Receipt of an order initiates assembly of the customized product. This strategy is useful where a large number of end products (based on the selection of options and accessories) can be assembled from common components. Synonym: finish-to-order. Also see: Make-to-Order, Make-to-Stock. Assembly: A group of subassemblies and/or parts that are put together and that constitute a major subdivision for the final product. An assembly may be an end item or a component of a higher level assembly. Assembly Line: An assembly process in which equipment and work centers are laid out to follow the sequence in which raw materials and parts are assembled. Assignment: A distribution of costs using causal relationships. Because cost causal relationships are viewed as more relevant for management decision-making, assignment of costs is generally preferable to allocation techniques. (Synonymous with Tracing. Contrast with Allocation.) Assumed Receipt: The principle of assuming that the contents of a shipping or delivery note are correct. Shipping and receiving personnel do not check the delivery quantity. Used in conjunction with bar codes and an EDI-delivered ASN to eliminate invoices. ATP: See Available to Promise ATS: See Available to Sell Attachment: An accessory that has to be physically attached to the product. Attributes: A label used to provide additional classification or information about a resource, activity, or cost object. Used for focusing attention and may be subjective. Examples are a characteristic, a score or grade of product or activity, or groupings of these items, and performance measures. Audit Trail: Manual or computerized tracing of the transactions affecting the contents or origin of a record. Auditability: A characteristic of modern information systems, gauged by the ease with which data can be substantiated by trading it to source documents and the extent to which auditors can rely on pre-verified and monitored control processes