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Qualitative Forecasting

Forecasting method based on expert judgment, opinions, and experience when data is limited or unreliable.

Quantitative Forecasting

Forecasting method using measurable data and mathematical models to predict demand trends and patterns.

Time Series Forecasting

Forecasting approach that studies past demand patterns like trends or seasonality to project future demand.

Simple Moving Average

Forecasting tool that averages demand from past periods to smooth out short-term fluctuations.

Weighted Moving Average

Forecasting method that gives more value to recent data to better reflect current demand patterns.

Exponential Smoothing

Forecasting method that focuses more on recent demand but still accounts for older data to make balanced predictions.

Naïve Forecast

Simplest forecasting method that assumes the next period’s demand will be the same as the last.

Cyclical Variation

Demand changes that occur in long-term economic or business cycles.

Seasonal Variation

Predictable demand patterns caused by recurring events like holidays or weather.

Trend Variation

A general long-term upward or downward movement in demand.

Aggregate Production Planning

Mid-range plan that balances demand with capacity and resources while minimizing cost.

Chase Production Strategy

Production strategy that matches production to demand, reducing inventory but requiring frequent changes.

Level Production Strategy

Production strategy that keeps output steady and uses inventory to handle demand changes.

Mixed Production Strategy

Blends level and chase approaches to balance flexibility and stability in production.

Master Production Schedule (MPS)

Detailed plan that translates aggregate production into specific product quantities and timeframes.

Material Requirements Planning (MRP)

System that calculates what materials and parts are needed and when to meet production goals.

Rough-Cut Capacity Planning (RCCP)

Process that checks if the Master Production Schedule can be met with available capacity.

Capacity Requirements Planning (CRP)

Determines the detailed labor and machine capacity needed to meet production requirements.

Distribution Requirements Planning (DRP)

System that coordinates inventory movement and replenishment between warehouses and distribution centers.

Economic Order Quantity (EOQ)

Formula used to find the optimal order size that minimizes total holding and ordering costs.

Reorder Point

Inventory level that triggers a new order, based on expected demand during lead time plus safety stock.

ABC Inventory Control

Inventory system that prioritizes items by value: A items are high-value and tightly controlled, B are moderate, and C are low-value and loosely managed.

Continuous Review System

Inventory system that monitors stock levels constantly and reorders when they hit a set point.

Periodic Review System

Inventory system reviewed at fixed intervals, requiring more safety stock to handle uncertainty.

Lean Systems

Operations approach aimed at cutting waste and improving flow without reducing value to the customer.

Just-In-Time (JIT)

Inventory philosophy that produces or orders materials only as needed to reduce waste and costs.

Kaizen

Continuous improvement concept where employees help identify small, ongoing process improvements.

Kanban

Visual scheduling tool that signals when materials or work are needed in production.

Six Sigma

Data-based quality method that minimizes defects and variation to improve consistency and performance.

Total Quality Management (TQM)

Company-wide quality approach centered on continuous improvement and customer satisfaction.

Quality Control

Monitoring processes and products to ensure standards are met and identifying causes of defects.

Short- and Long-Term Planning

Balancing immediate goals with future objectives for sustainable improvement and efficiency.

Inventory Waste

Excess or unsold inventory that increases costs and reduces efficiency.

Warehouse Location Selection

Process of choosing facility sites based on costs, transportation access, supplier and market proximity, and sustainability goals.

Sustainability in Logistics

Managing logistics activities to reduce environmental impact and conserve resources over time.

Transportation Modes

The different shipment methods—truck, rail, air, and water—each with unique cost, speed, and flexibility characteristics.

Truck Transportation

Most flexible transportation method, offering fast, direct shipments across short to medium distances.

Rail Transportation

Efficient and cost-effective for long-distance, heavy, or bulk shipments, but limited to fixed routes.

Water Transportation

Least expensive method for long-distance, heavy shipments, though slower and weather-dependent.

Air Transportation

Fastest shipping option for high-value or time-sensitive goods but very costly.

Intermodal Transportation

Combines two or more transport modes (like rail and truck) to improve efficiency and lower costs.

Pareto Principal

Concept stating that 80% of objective is achieved by 20% of tasks—used to focus improvement efforts on the most critical areas.