A
Assemble to order (ATO) – product is made from standard components kept as stock and assembled according to customer order
Available-to-promise (ATP) is the part of inventory and planned production which is available to be promised to customers for delivery
B
Backflushing (post-deduct) – determining number of parts that must be subtracted from inventory records based on parts withdrawn from inventory and parts that have been consumed in a manufacturing line calculated according to BOMs (in JIT reduces number of transactions that must be recorded)
Bias is systematic error where actual demand is consistently above or below the forecast demand
Bill of Distribution shows the source of supply for each warehouse
Bullwhip effect is when demand fluctuations implicate increase of requirements in different areas of supply chain which leads to excessive inventories within entire network impacting most supplier of raw materials
C
Capacity is an amount of work that can be done in a specified time period (the capability of worker, machine, work center, plant or organization to produce output per time), rate of doing work, not the quantity of work done
Central Storage is easy of control, inventory record accuracy easier to maintain, specialized storage can be used, reduced safety stock since users don’t need to carry their own safety stock
Collaborative forecasting allows the customer and supplier to communicate and adjust the forecast based on the data of both firms
Competitive bidding is a selection of supplier with the lowest price (concerns a product well specified and widely available)
Critical chain method – in Theory of Constraints a network planning technique for the analysis of project’s completion time, used for planning and controlling project activities
Customer Chain is the sequence of customers who in turn consume the output of each other
Cyclic inventory count (usually daily) – most important to audit the system and find the causes of record inaccuracy eliminating them
D
Decoupling inventory – type of inventory that creates independence between supply and the use of material
Demonstrated Capacity is an average of historical data
Design for manufacturability employs cross functional teams to move market driven products to customers quickly and at a lower cost
Dispatching rules: first come, first served; earliest job due date; earliest operation due date; shortest process time; Critical Ratio CR
E
Exploding is the process of multiplying the requirements by the usage quantity and recording the appropriate requirements throughout the product tree
F
Forecast error is the difference between actual demand and forecast demand
G
H
I
Input/output control is about controlling queue, work-in-process and lead times (controlling capacity)
Input rate controlled by release of orders to the shop floor and Output rate controlled by increasing or decreasing capacity of work center
Intermittent manufacturing where goods are made at intervals in lots or batches processing many different parts by using general purpose machinery
J
K
L
Linearity – scheduling to less than full capacity (rest of time used to react to problems occurred, cleaning, lubricating machinery and solving problems)
Load is an amount of released and planned work assigned to facility for particular time period (sum of all required capacities)
Low-level code is the lowest level on which a part resides in all bills of materials (end item is level 0)
M
Make to order (MTO) – start of production after order is received; little design time required and inventory held as raw material (broad range of end products from narrow set of components)
Make to stock (MTS) when business makes a narrow range of end products from a relatively broad set of components
N
O
Offsetting is the process of placing the exploded requirements in their proper periods based on lead time
Ordering Costincludes any cost associated with placing orders on the factory or suppliers
(receivers taking material, setup cost, cost of material planners, cost of buyers)
P
Pegging report – where-used report but showing only parents for which there is an existing requirement
Pegging (Full) – maintains relationship with the highest level order in addition to the method of single pegging (end items like products can be checked by each order)
Periodic inventory count (usually annual) – to satisfy financial auditors that the inventory represents the value of inventory; for planners it’s an opportunity to correct any inaccuracies in the records
Phantom BOM – represents an item that is physically built but not stocked before being used in the next step or level of manufacturing
Planning bill – artificial grouping of components for planning purposes showing the percentage split of each type of component on one bill (average product)
Point-of-usestorage where materials are readily accessible to users, material handling is reduced or eliminated, central storage costs are reduced, material is accessible at all times
Priority refers to maintaining the correct due dates on orders
Priority control is the communication of start and completion dates to manufacturing department to execute plan
Process Capability index measures whether process variation is satisfactory
Product Layout (Flow Process Layout) where the system is set up for a limited range of similar products,
can be repetitive where units are discrete e.g. automobiles, or continuous where units are not discrete e.g. gasoline
Project (fixed position) manufacturing used for large complex projects such as ships or buildings
Q
R
Resource bill – shows quantity of critical resources needed to make one average unit of product group
S
Safety factor is number of sigma that provides you desired service level (for 84% service level safety factor is 1)
Scheduled receipt is when an order that has been issued either to manufacturing or to a supplier
Seasonal index is an indication of seasonal variation for a product, estimate how much of demand during the season will be above or below the average demand for the product
Shop order master file contains record of each active manufacturing order
Shop order detailed file contains record of each operation needed to make the item
T
Tracking forecast is comparing actual demand with the forecast
Tracking signal – detects bias in a forecasting model, monitors quality of forecast
Transportation inventory = pipeline inventory = movement inventory
U
V
Value Chainrefers to total value generated by a company: value activities (primary and support) and margin
W
Work center load report shows future capacity requirements based on released and planned orders for each time period, rated capacity and over/under capacity
X
Y
Z