Glossary

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. In EDI data standards this is referred to as an 856 transaction. May also include carrier and shipment specifics including time of shipment and expected time of arrival.

A market for parts and accessories used in the repair or enhancement of a product. A secondary market created after the original market sales are finished.

Tools, techniques, and initiatives that enable a plant or company to thrive under conditions of unpredictable change. Agile manufacturing not only enables a plant to achieve rapid response to customer needs, but also includes the ability to quickly reconfigure operations-and strategic alliances-to respond rapidly to unforeseen shifts in the marketplace. In some instances, it also incorporates "mass customization" concepts to satisfy unique customer requirements. In broad terms, it includes the ability to react quickly to technical or environmental surprises.

A feature of an inventory control and order management system which allows for quantities available in inventory to be associated with a customer or production order so that the quantity cannot otherwise be used.

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 "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.

Accredited Standards Committee X12. A committee of ANSI chartered in 1979 to develop uniform standards for the electronic interchange of business documents.

B2B integration capabilities that are hosted in a multitenant environment were traditionally known as "EDI value-added networks (VANs)"; Gartner now call these hosted offerings "integration as a service." Vendors referred to their integration-as-a-service offerings with a range of labels, including EDI VANs, integration platforms, EDI software as a service (SaaS), EDI services, Web services networks, transaction delivery networks, hosted integration services, business process networks, integration service providers and on-demand EDI. To be considered as an integration service provider, a vendor must offer hosted multienterprise integration and interoperability services. These include some combination of:

• Communications services (including multiprotocol support for protocols such as EDI, AS2, RosettaNet and Web services)
• Trading partner management services (such as tools to provision connections and manage certificates for security)
• Integration services (such as in-line translation and back-end system integration)
• Application services (such as order visibility or compliance management)

A sequence number associated with a specific batch or production run of products and used for  tracking purposes.

A computer term which refers to the processing of computer information after it has been accumulated in one group, or batch. This is the opposite of “real-time” processing where transactions are processed in their entirety as they occur.

A transportation document that is the contract of carriage containing the terms and conditions between the shipper and carrier.

A structured list of all the materials or parts and quantities needed to produce a particular finished product, assembly, subassembly, or manufactured part, whether purchased or not.

A blanket order is defined as an order the customer makes with its supplier which contains multiple delivery dates scheduled over a period of time, sometimes at predetermined prices. It is normally used when there is a recurring need for expendable goods. Hence, items are purchased under a single purchase order (P.O) rather than processing a separate P.O. each time supplies are needed.

The operation with the least capacity in a total system with no alternative routings; the total system can be effectively scheduled by simply scheduling the limiting operation.

The automation of complex business processes and functions beyond conventional data manipulation and record-keeping activities, usually through the use of advanced technologies. It focuses on "run the business" as opposed to "count the business" types of automation efforts and often deals with event-driven, mission-critical, core processes. BPA usually supports an enterprise's knowledge workers in satisfying the needs of its many constituencies.

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.

A forward-looking activity that monitors the skill sets and effective resource capacity of the organization. For product development, the objective is to manage the flow of projects through development such that none of the functions (skill sets) creates a bottleneck to timely completion. Necessary in optimizing the project portfolio.

Processes, services and applications used to allow electronic catalog creation and updating in an e-commerce environment.

Automated support for development, rollout and maintenance of system components (i.e., intelligent regeneration, package versioning, state control, library control, configuration management, turnover management and distributed impact sensitivity reporting).

Strategies aimed at consolidating – either physically or logically – customer information and its use to provide an all-encompassing view of the customer.

Collaborative, electronically enabled business interactions among an enterprise's internal personnel, business partners and customers throughout a trading community. The trading community could be an industry, industry segment, supply chain or supply chain segment.

High-speed workstations or personal computers that use specialized software and input devices such as graphic tablets and scanners for specialized use in architectural, electrical and mechanical design. With few exceptions, CAD systems rely extensively on graphics.

The manufacturing of goods controlled and automated via computer and robot. Frequently used in conjunction with computer-aided design (CAD).

Application software used to develop work instructions and product manufacturing or assembly steps in discrete manufacturing operations.

Critical Path Managment (CPM) is a project management technique which maps out when a series of activities in a project can start and finish without extending the project timeline. Utilized by various manufacturing sectors, CPM was successfully applied to retail and apparel manufacturing where it is also referred to as calendar management.

Cycle Time: The length of time for any operation, from start to completion. In the new product development sense, it is the length of time to develop a new product from an early initial idea for a new product to initial market sales. Precise definitions of the start and end point vary from one company to another, and may vary from one project to another within the company.

A typically colored graphical presentation of a project's status or a portfolio's status by project resembling a vehicle's dashboard. Typically, red is used to flag urgent problems, yellow to flag impending problems, and green to signal on projects on track.

The process of forecasting and managing the demand for products and services by end users, as well as by intermediate supply chain members.

The selling channels supported by an enterprise. These may include retail sales, distribution partner (e.g. wholesale) sales, original equipment manufacturer (OEM) sales, Internet exchange or marketplace sales, and Internet auction or reverse auctions sales.

Electronic data interchange (EDI) is the structured transmission of data between organizations by electronic means. It is used to transfer electronic documents or business data from one computer system to another computer system, i.e. from one trading partner to another trading partner without human intervention.

An industry term for the broad set of activities supported by multi-module application software that helps a manufacturer or other business manage the important parts of its business, including product planning, parts purchasing, maintaining inventories, interacting with suppliers, providing customer service, and tracking orders. ERP can also include application modules for the finance and human resources aspects of a business.

Extensible Markup Language (XML) is a set of rules for encoding documents in machine-readable form.  The design goals of XML emphasize simplicity, generality,and usability over the Internet.  Although the design of XML focuses on documents, it is widely used for the representation of arbitrary data structures, for example in web services. Many application programming interfaces (APIs) have been developed that software developers use to process XML data, and several schema systems exist to aid in the definition of XML-based languages. As of 2009[update], hundreds of XML-based languages have been developed,[7] including RSS, Atom, SOAP, and XHTML. XML-based formats have become the default for most office-productivity tools, including Microsoft Office (Office Open XML), OpenOffice.org (OpenDocument), and Apple's iWork.[8]

Integrated Logistics is a system-wide management view of the entire supply chain, from raw materials supply through finished good distribution.

The cost of goods sold divided by the average level of inventory on hand. This ratio measures how many times a company's inventory has been sold during a period of time. Operationally, inventory turns are measured as total throughput divided by average level of inventory for a given period.

Just-in-Time (JIT) is a n inbound manufacturing strategy that smoothes material flow into assembly and manufacturing plants. JIT minimizes inventory investment by providing timely, sequential deliveries of product exactly where and when it is needed, from a multitude of suppliers.

Retailers traditionally maintained a single department, offering sales and support via a single mode of customer interaction like the physical store. Over time this has expanded to include multiple ways of selling to, engaging, and interacting with the customer, primarily via mail, catalogue and telephone. Advancing technology however, has led to a number of new ways of inter-personal interaction like the internet, mobile phones, and interactive TV; and as these embed deeper into social culture, subsequently new channels for offering product and service. Multi-Channel then refers to the delivery of customer propositions via multiple channels with at least some degree of cross channel integration in management, information and service, i.e. in a consistent and coordinated way across all channels.

The definition of a perfect order is one which meets all of the following criteria:

• Delivered complete, with all items on the order in the quantity requested.
• Delivered on time to customer’s re-quest date, using the customer’s definition of on-time delivery.
• Delivered with complete and accurate documentation supporting the order, including packing slips, bills of lading, and invoices.
• Delivered in perfect condition with the correct configuration, customer ready, without damage, and faultlessly in-stalled (as applicable).

An invoice, forwarded by the seller of goods prior to shipment, that advises the buyer of the particulars and value of the goods. Usually required by the buyer in order to obtain an import permit or letter of credit.

Product data management (PDM) is the business function often within product lifecycle management^[ that is responsible for the creation, management and publication of product data. In software engineering, this is known as version control.

Product Lifecycle Mangement (PLM) is a comprehensive information and workflow system that coordinates all aspects of a product's lifecycle from initial concept to delivery and payment. It includes phases such as design stages, quotations, sourcing, production, quality assurance, logistics and finance. In apparel, it is also referred to as Merchandize Lifecycle Management (MLM) and in other industries is sometimes referred to as Product Data Management (PDM).

A specialized segment of logistics focusing on the movement and management of products and resources after the sale and after delivery to the customer. Includes product returns for repair and/or credit.

The inventory a company holds above normal needs as a buffer against delays in receipt of supply or changes in customer demand.

A strategic planning process that reconciles conflicting business objectives and plans future supply chain actions. S&OP Planning usually involves various business functions such as sales, operations and finance to agree on a single plan/forecast that can be used to drive the entire business. Some organizations include suppliers and customers in their S&OP processes.

An 18-character identification number used to identify containers including pallets and boxes primarily for containers which are a part of a shipment covered by an Advanced Shipment Notice (ASN).

A document which is typically presented to the carrier outlining the individual shipping orders included in a shipment. The manifest will show the reference number of each shipping order in the load, the weight and count of boxes or containers, and the destination.

A term which describes the use of computer systems provided by a remote third party, similar to what has traditionally been called a “Service Bureau” or “Application Service Provider (ASP)”. In this setting the service provider maintains all of the computer hardware and software at their location, while the user accesses the systems via an internet connection and is charged a rate based on access time. It is also sometimes also referred to as “On Demand” services.

The length of time it takes to develop a new product from an early initial idea for a new product to initial market sales. Precise definitions of the start and end point vary from one company to another, and may vary from one project to another within a company.

The process of determining long-term supply requirements, finding sources to fulfill those needs, selecting suppliers to provide the services, negotiating the purchase agreements and managing the suppliers' performance. Focuses on developing the most effective relationships with the right suppliers, to ensure that the right price is paid and that lifetime product costs are minimized. It also assesses whether services or processes would provide better value if they were outsourced to specialist organizations.

A Key indicator of On-Time Product Deliveries, in terms of whether the lead times are being met and product is reaching the market at the right time. Time required for a supplier to complete a single cycle, beginning with receipt of an order and ending with the fulfillment of the order.

SCEM is an application that supports control processes for managing events within and between companies. It consists of integrated software functionality that supports five business processes: monitor, notify, simulate, control and measure supply chain activities.

Supply Chain Management is the movement of materials, funds and related information through the full logistics process, from the acquisition of raw materials to delivery of finished products to the end-user. The supply chain includes all vendors, service providers, customers and intermediaries.

The process of identifying, prioritizing, and aggregating, as a whole with constituent parts, all  sources of supply that are required and add value in the supply chain of a product or service at the appropriate level, horizon and interval.

A new rule instituted by the United States Customs and Border Protections (US CBP). 10+2 requires cargo information, for security purposes, to be transmitted to the US CBP at least 24 hours before goods are loaded onto an ocean vessel for shipment into the U.S. 10+2 is pursuant to section 203 of the SAFE Port Act, and requires importers to provide 10 data elements to the US CBP, as well as 2 more data elements from the carrier. The following 10 data elements are required from the importer:

1. Manufacturer (or supplier) name and address
2. Seller (or owner) name and address
3. Buyer (or owner) name and address
4. Ship-to name and address
5. Container stuffing location
6. Consolidator (stuffer) name and address
7. Importer of record number/foreign trade zone applicant identification number
8. Consignee number(s)
9. Country of origin
10. Commodity Harmonized Tariff Schedule number

From the carrier, 2 data elements are required:

1. Vessel stow plan.
2. Container status messages

   

The time interval between product concept development and introduction to the marketplace. It includes specification development, product development and release to production.

A measure that sums all costs associated with poor quality or product failure, including rework, scrap, warranty costs and other costs incurred in preventing or resolving quality problems. Costs associated with maintenance and quality training are not included.

1) The ability to track the location of a shipment as it moves through the shipping process to the customer. 2) The ability to determine the source of individual lot numbered or serial numbered products.

Companies that do business with each other via EDI (e.g., send and receive business documents, such as purchase orders).

Specific Transaction Sets, such as the Purchase Order Acknowledgement (855), that both acknowledges receipt of an order and provides special status information such as reschedules, price changes, back order situation, etc.

The ability to gain access to information without regard to the systems landscape or architecture. An example would be where an online customer could access a vendor’s web site to place an order and receive availability information supplied by a third party outsourced manufacturer or shipment information from a third party logistics provider.

Standard unit for counting containers of various capacities and for describing the capacities of container ships or terminals. One 20 Foot ISO container equals 1 TEU. One 40 Foot ISO container equals two TEU. A 20 foot container is typically 8.5 feet tall and 8 feet wide outside and has an internal capacity of 1170 square feet.

A standard product numbering and bar coding system used by the retail industry. UPC codes are administered by the Uniform Code Council; they identify the manufacturer as well as the item, and are included on virtually all retail packaging.

Refers to the supply side of the supply chain. Upstream partners are the suppliers who provide goods and services to the organization needed to satisfy demands which originate at point of demand or use, as well as other flows such as return product movements, payments for purchases, etc.

A series of activities, which combined, define a business process; the series of activities from manufacturers to the retail stores that define the industry supply chain.

A pencil and paper tool used in two stages: 1. Follow a product's production path from beginning to end and draw a visual representation of every process in the material and information flows. 2. Then draw a future state map of how value should flow. The most important map is the future state map.

A unique identifier, usually a number and sometimes the company's DUNS number, assigned by a  customer for the Vendor it buys from. Example; a Grocery Store Chain buys Oreo's from Nabisco. The Grocery Store Chain, for accounting purposes, identifies Nabisco as Vendor #76091. One company can have multiple vendor codes. Example; Welch's Foods sells many different products. Frozen grape juice concentrate, chilled grape juice, bottled grape juice, and grape jelly. Because each of these items is a different type of product, frozen food, chilled food, beverages, dry food, they may have a different buyer at the Grocery Store Chain, requiring a different vendor code for each product line.

In the VMI process, the vendor assumes responsibility for managing the replenishment of stock. Rather than a customer submitting orders, the vendor will replenish stock as needed. This process is sometimes referred to as supplier-managed inventory (SMI) or co-managed inventory. The vendor may or may not assume ownership of the inventory.

A style of management control. Vertically integrated companies are united through a hierarchy with a common owner. Usually each member of the hierarchy produces a different product or (marketspecific) service, and the products combine to satisfy a common need. Vertical integration defines the degree to which a firm owns its upstream suppliers and its downstream buyers it is typified by one firm engaged in different parts of production (e.g. growing raw materials, manufacturing, transporting, marketing, and/or retailing).

A software application that manages the operations of a warehouse or distribution center. Application functionality includes receiving, putaway, inventory management, cycle counting, task interleaving, wave planning, order allocation, order picking, replenishment, packing, shipping, labor management and automated material-handling equipment interfaces. The use of radio frequency technology in conjunction with bar codes provides the foundation of a WMS, delivering accurate information in real time.

A variation on zone picking where rather than orders moving from one zone to the next for picking, all zones are picked at the same time and the items are later sorted and consolidated into individual orders/shipments. Wave picking is the quickest method for picking multi item orders however the sorting and consolidation process can be tricky. Picking waves are often designed to isolate shipments to specific carriers, routes, etc. See also batch picking, zone picking A more general definition of wave picking would simply be a method where a group of orders is released to the warehouse for picking and the next group (wave) is not released until the first wave has processed through the pick area.

Document containing description of goods that are part of common carrier freight shipment. Show origin, destination, consignee/consignor, and amount charged. Copies travel with goods and are retained by originating/delivering agents. Used by carrier for internal record and control, especially during transit. Not a transportation contract.

Parts and subassemblies in the process of becoming completed finished goods. Work in process generally includes all of the material, labor and overhead charged against a production order which has not been absorbed back into inventory through receipt of completed products.

A Just-In-Time Inventory Control term where emphasis is placed on reducing inventory to minimal levels to reduce costs and promote organizational effectiveness.