SCM 301 Exam 1 Lukoff

Second-tier supplier

A supplier that provides products or services to a firm's first-tier supplier.

first tier suppliers

The direct suppliers of the focal firm.

supply chain

A network of trading partners that make products and services available to consumers, including all of the functions enabling the production, delivery and recycling of materials, components, end products and services

second tier customers

a customer's customers

First tier customers

A firm's direct customers

supply chain management

The integration of key business processes regarding the flow of materials from raw material suppliers to the final customer.

supply chain (his definition)

the flow of goods and/or services, money, and information, from the point/moment of need identification to the point of value for the final customer

supply chain analytics

Tools that harness data from internal and external sources to produce breakthrough insights that can help supply chains reduce costs and risk.

Multichannel Fulfillment

Allowing consumers to shop for what they want, where they want, and when they want, and then have their purchases delivered quickly and consistently.

Business Process Reengineering (BPR)

the radical rethinking and redesigning of business processes to reduce waste and increase performance

bullwhip effect

A term referring to ineffective communication between buyers and suppliers and infrequent delivery of materials, combined with production based on poor forecasts along a supply chain that results in either too little or too much inventory at various points of storage and consumption. Simply, it causes an amplification of the variation in the demand pattern along the supply chain.

Customer Relationship Management (CRM)

Managing a firm's customer base such that customers remain satisfied and continue to purchase goods and services. Sometimes it also refers to CRM software applications.

Third-party logistics (3PL) provider

For-hire outside agents that provide transportation and other services including warehousing, document preparation, customs clearance, packaging, labeling and freight bill auditing.

Supply Management

The identification, acquisition, access, positioning and management of resources the organization needs or potentially needs in the attainment of its strategic objectives.

Sustainability

a commitment to environmental responsibility

Enterprise Resource Planning (ERP)

A packaged business software system that lets a company automate and integrate the majority of its business processes, share common data and practices across the enterprise and produce and access information in a real-time environment.

Triple Bottom Line

A broad term that includes protecting the environment and some aspects of social responsibility, as well as financial performance.

supplier management

One of the most crucial issues within the topic of supply management—getting suppliers to do what the buyer's firm wants them to do.

Supplier Certification

Defined by the Institute of Supply Management as "an organization's process for evaluating the quality systems of key suppliers in an effort to eliminate incoming inspections

ethical and sustainable sourcing

purchasing from suppliers that are governed by environmental sustainability and social and ethical practices

Operations Management (OM)

Managing the processes of buying, making, and delivering goods and services

strategic partnerships

A close working relationship that develops among trading partner relationships

Supplier Evaluation

determining the current capabilities of supplier

Demand Management

A set of activities that range from determining or estimating the demand from customers through converting specific customer orders into promised delivery dates to help balance demand with supply

Six Sigma Quality Management

a commitment by the firm's top management to help the firm identify customer expectations and excel in meeting and exceeding those expectations

Material Requirements Planning (MRP)

a planning system that schedules the precise quantity of materials needed to make the product

Lean Production System

Also known as a pull system, where parts are placed in standardized containers, and kanbans exist for each container.

Logisitcs

The practice of moving and storing goods to meet customer requirements for the minimum cost.

third party logistics services

for-profit logistics companies

Global Supply Chains

supply chains with foreign trading partners

distribution network

The organization of a distribution system that ensures successful product delivery

Supply Chain Process Integration

Supplier, producers, and customers working together to make purchasing, inventory, production, quality, and logistics decisions that impact the overall costs and profits of the supply chain.

Supply Chain Performance Measurement

Determining the performance of an entire supply chain.

Circular Economy

An economic system aimed at eliminating waste and the continual use of resources

Big Data

Collections of data sets that are too large and complex to be processed by traditional database management tools or data processing software applications

supply chain visibility

The ability of suppliers, manufacturers, business partners, and customers to know exactly where products are, at any point in the supply chain

Performance Measurement

The process of quantifying the efficiency and effectiveness of various activities.

performance variance

The difference between the standard and actual performance.

Environmental sustainability

The need to continually protect the environment and reduce greenhouse gas emissions

carbon footprints

A firm's or supply chain's total carbon emissions

total productivity measures

A measure of total outputs divided by total inputs

green supply chain management

an organizational approach that extends the concept of green logistics to include activities related to environmentally responsible product design, acquisition, production, distribution, use, reuse and disposal by partners within the supply chain

ingle-factor productivity measures

the output measure divided by a single input measure, such as labor cost

Balanced Scorecard (BSC)

A management system developed in the early 1990s by Robert Kaplan and David Norton that helps companies to continually refine their vision and strategy. The balanced scorecard uses a set of measures to provide feedback on internal business performance in order to continually improve strategic performance. Also referred to as scorecarding

Scorecarding

A performance measure design technique such as the Balanced Scorecard that uses the scorecard model.

Performance dashboards

Web-based balanced scorecard applications.

Collaborative planning, forecasting and replenishment (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

Qualitative Forecasting Methods

Forecasts based on opinions and intuition.

Naïve Forecast

A forecasting approach where the actual demand for the immediate past period is used as a forecast for next period's demand.

cause and effect forecasting

A forecasting method that uses one or more factors (independent variables) that are related to demand to predict future demand

Quantitative Forecasting Methods

Forecasts based on mathematical models and relevant historical data

time series forecasting

A prediction technique based on the assumption that the future is an extension of the past and that historical data can thus be used to forecast future demand

business cycle

Definition:Alternating periods of expansion and contraction in economic activity.

Simple Moving Average Forecast

A method that uses historical data to generate a forecast; it works well when the demand is fairly stable over time

Linear Trend Forecast

A forecasting method in which the trend can be estimated using simple linear regression to fit a line to a time series of historical data.

forecast error

The difference between actual demand and the forecast

forecast bias

a measure of the tendency of a forecast to be consistently higher (negative bias) or lower (positive bias) than the actual demand

multiple regression forecasts

a forecast technique using multiple regression

tracking signal

A tool used to check the forecast bias.

artificial intelligence

self learning machines

cloud-based forecasting

Using supplier-hosted or software-as-a-service (SaaS) advanced forecasting applications that are provided to companies on a subscription basis.

machine learning

self learning machines

Demand Sensing

A way of identifying short-term trends quickly so companies can better forecast what, when, and where consumers want goods

long-range

A planning horizon that covers a year or more.

intermediate

A planning horizon that covers six to eighteen months

Medium-range

A planning horizon that covers six to eighteen months

Distribution Requirements Planning (DRP)

he time-phased net requirements from central supply warehouses and distribution centers. It links production with distribution planning by providing aggregate time-phased net requirements information to the master production schedule

product family

A group consisting of different products that share similar characteristics, components or manufacturing processes.

Aggregate Production Plan

A long-range production plan; it sets the aggregate output rate, workforce size, utilization, inventory and backlog levels for a plant.

Short Range Planning Horizon

A planning horizon that covers a weekly, daily, or hourly basis

chase production strategy

A production strategy that adjusts output to match the demand pattern during each production period

Make to Order (MTO)

Firms that make custom products based on orders from customers, resulting in long lead times and higher unit costs.

Make to Stock (MTS)

Firms that typically emphasize immediate delivery of off-the-shelf, standard goods at relatively low prices compared to the chase strategy.

Master Production Schedule (MPS)

A medium range production plan that is more detailed than the aggregate production plan

level production strategy

using a constant output rate and capacity while varying inventory and backlog levels to handle the fluctuating demand pattern.

Mixed Production Strategy

Maintains stable core workforce while using other short-term means, such as overtime, subcontracting & part time helpers to manage short-term demand.

system nervousness

a situation where a small change in the upper level production plan causes a major change in the lower level production plan

demand time fence (DTF)

Definition:A firmed planning segment that is used with the MRP application; it usually stretches from the current period to a period several weeks into the future

planning time fence

A period typically stretching from the end of the firmed segment to several weeks farther into the future; also known as the tentative segment

Avaliable to promise

he uncommitted portion of a firm's planned production. It is used to promise new customer orders.

Bill of Materials (BOM)

engineering document that shows an inclusive listing of all component parts and assemblies making up the final product

time fence system

Separates the planning horizon into two segments: a firmed and a tentative segment

planning factor

A calculation showing the number of units of a specific component required to make one unit of a higher-level part.

Independent Demand

The demand for final products and service parts. It has a demand pattern that is affected by trends, seasonal patterns and general market conditions

Super Bill of Materials

Another type of bill of materials that is useful for planning purposes

Indented Bill of Material

Indentations are used to present the level number within the bill of materials; also known as the multilevel bill of materials.

dependent demand

The internal demand for parts based on the demand of the final product in which the parts are used.

option overplanning

Raising the final requirements of component parts beyond 100 percent in a super bill of materials to cover uncertainty

capacity

The output capabilities of a firm's labor and machine resources.

Closed-loop MRP

An MRP-based manufacturing planning and control system that incorporates aggregate production planning, master production scheduling, material requirements planning and capacity requirements planning

Rough-Cut Capacity Planning (RCCP)

A plan that is used to check the feasibility of the master production schedule

Capacity requirements planning

A shortrange capacity planning technique that is used to check the feasibility of the material requirements plan.

resource requirements planning

A long range capacity planning module that is used to check whether aggregate resources are capable of satisfying the aggregate production plan

lead capacity strategy

A proactive approach that adds or subtracts capacity in anticipation of future market condition and demand

match

A moderate strategy that adjusts capacity in small amounts in response to demand and changing market conditions.

Tracking Capacity Strategy

A moderate strategy that adjusts capacity in small amounts in response to demand and changing market conditions.

Lag Capacity Strategy

A reactive approach that adjusts capacity in response to demand.

Distribution requirements plan

A time-phased finished goods inventory replenishment plan in a distribution network.

implosion

When demand information is gathered from a number of field distribution centers and aggregated in the central warehouse, and eventually passed onto the manufacturing facility

legacy MRP system

A broad label used to describe an older information system that usually works at an operational level to schedule production within a single facility.