Module 1: Supply Chain Design Module 1: Supply Chain Design

active tag advanced planning and

scheduling (APS)

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automatic identification and automatic identification

data capture (AIDC) system (AIS)

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available-to-promise (ATP) business process

management (BPM)

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business-to-business business-to-consumer sales

commerce (B2B) (B2C)

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 Definition Definition
Techniques that deal with analysis and planning of logistics and A radio frequency identification tag that broadcasts
manufacturing during short, intermediate, and long-term time periods. [This]
describes any computer program that uses advanced mathematical
information and contains its own power source.
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. [This] often generates and evaluates
multiple scenarios. Management then selects one scenario to use as the
“official plan.” The five main components of [these] systems are (1) demand
planning, (2) production planning, (3) production scheduling, (4) distribution
planning, and (5) transportation planning.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A system that can use various means, including bar code Technologies that collect data about objects and then
scanning and radio frequencies, to sense and load data in sends the data to a computer without human intervention.
a computer. Examples include radio frequency wireless devices and
terminals, bar code scanners, and smart cards.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A business discipline or function that uses business 1) In operations, the uncommitted portion of a company’s inventory and
practices, techniques, and methods to create and improve planned production maintained in the master schedule to support
customer-order promising. [This] quantity is the uncommitted inventory
business processes. [A] holistic approach to the use of balance in the first period and is normally calculated for each period in
appropriate process-related business disciplines to gain which an MPS receipt is scheduled. In the first period, [this] includes
business performance improvements across the enterprise on-hand inventory less customer orders that are due and overdue.
or supply chain. It promotes business effectiveness and Three methods of calculation are used: discrete [...], cumulative [...]
efficiency while striving for innovation, flexibility, and with look-ahead, and cumulative [...] without look-ahead. (2) In logistics,
the quantity of a finished good that is or will be available to commit to a
integration with technology. Most process improvement customer order based on the customer's required ship date. To
disciplines or activities can be considered [this]. accommodate deliveries on future dates, [this] is usually time-phased to
include anticipated purchases or production receipts.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
Business being conducted between businesses and final Business conducted over the internet between businesses.
consumers, largely over the internet. It includes traditional The implication is that this connectivity will cause
brick and mortar businesses that also offer products online businesses to transform themselves via supply chain
and businesses that trade exclusively on the internet. management to become virtual organizations—reducing
costs, improving quality, reducing delivery lead time, and
improving due-date performance.

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 Module 1: Supply Chain Design Module 1: Supply Chain Design

capable-to-promise (CTP) content management

applications

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cost of goods sold (COGS) database management

system (DBMS)

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demand shaping design for manufacturability

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design for manufacture and design for quality

assembly (DFMA)

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 Definition Definition
Supports the evolutionary life cycle of digital-based The process of committing orders against available capacity as well as
inventory. This process may involve multiple manufacturing or distribution
information and makes information dynamically updatable sites. Used to determine when a new or unscheduled customer order can be
online; includes the ability to publish content to a repository delivered. Employs a finite-scheduling model of the manufacturing system to
and support access to digital-based content. determine when an item can be delivered. Includes any constraints that
might restrict the production, such as availability of resources, lead times for
raw materials or purchased parts, and requirements for lower-level
components or subassemblies. The resulting delivery date takes into
consideration production capacity, the current manufacturing environment,
and future order commitments. The objective is to reduce the time spent by
production planners in expediting orders and adjusting plans because of
inaccurate delivery-date promises.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The software designed for organizing data and providing An accounting classification useful for determining the
the mechanism for storing, maintaining, and retrieving that amount of direct materials, direct labor, and allocated
data on a physical medium (i.e., a database). [This] overhead associated with the products sold during a given
separates data from the application programs and people period of time.
who use the data and permits many different views of the
data.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
Simplification of parts, products, and processes to improve The practice of using the four Ps (product, pricing,
quality and reduce manufacturing costs. placement, and promotion) and other market variables to
influence the demand of a product or service so that
demand better matches available supply.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A product design approach that uses quality measures to A product development approach that involves the
capture the extent to which the design meets the needs of manufacturing function in the initial stages of product
the target market (customer attributes), as well as its actual design to ensure ease of manufacturing and assembly.
performance, aesthetics, and cost.

APICS CSCP Learning System APICS CSCP Learning System

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design for remanufacture design for service

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design for six sigma design for the environment

(DFE)

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design for the supply chain economic value added

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electronic commerce electronic data interchange

(e-commerce) (EDI)

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 Definition Definition
Simplification of parts and processes to improve the after- Products developed in a manner that allows components to
sale service of a product. be used in other products. This process is associated with
green manufacturing.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
Considering health, safety, and environmental aspects of a An approach to designing products and processes that
product during the design and development phase of attempts to ensure the firm can provide products or
product development. services that meet six sigma quality levels. These quality
levels correspond to approximately 3.4 defects per million
opportunities.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
In managerial accounting, the net operating profit earned Enhancement of a firm’s product design in consideration of
above the cost of capital for a profit center. the issues that will arise in the supply chain, from raw
materials to the final stage of the product’s life cycle.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The paperless (electronic) exchange of trading documents, The use of computer and telecommunication technologies
such as purchase orders, shipment authorizations, to conduct business via electronic transfer of data and
advanced shipment notices, and invoices, using documents.
standardized document formats.

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electronic document electronic product codes

(EPCs)

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enterprise resources planning global strategy

(ERP)

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glocalization information system

architecture

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innovative products inventory optimization

software

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 Definition Definition
Codes that are used with RFID tags to carry information on The electronic representation of a document that can be
the product that will support warranty programs. printed.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A strategy that focuses on improving worldwide Framework for organizing, defining, and standardizing the
performance through the sales and marketing of common business processes necessary to effectively plan and
goods and services with minimum product variation by control an organization so the organization can use its
country. Its competitive advantage grows through selecting internal knowledge to seek external advantage. [This type
the best locations for operations in other countries. of] system provides extensive databanks of information
including master file records, repositories of cost and sales,
financial detail, analysis of product and customer
hierarchies, and historic and current transactional data.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A model of how the organization operates regarding A combination of “globalization” and “localization.” In a
information. The model considers four factors: (1) supply chain context, [this] is a form of postponement
organizational functions; (2) communication of coordination where a product or service is developed for distribution
requirements; (3) data modeling needs; and (4) globally but is modified to meet the needs of a local market.
management and control structures. [This] should be The modifications are made to conform with local laws,
aligned with and match the architecture of the organization. customs, cultures, and preferences.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A computer application that can find optimal inventory Products that tend to have a high profit margin, be unique,
strategies and policies related to customer service and have less competition, and have dynamic demand.
return on investment over several echelons of a supply
chain.

APICS CSCP Learning System APICS CSCP Learning System

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inventory valuation keiretsu

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legacy systems level of service

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life cycle analysis market share

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marketing research modular design strategy

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 Definition Definition
A form of cooperative relationship among companies in The value of the inventory at either its cost or its market
Japan where the companies largely remain legally and value. Because inventory value can change with time,
economically independent, even though they work closely some recognition is taken of the age distribution of
in various ways such as financial backing. A member of inventory. Therefore, the cost value of inventory is usually
[this] generally owns a limited amount of stock in other computed on a FIFO, LIFO, or standard cost basis to
member companies. [It] generally forms around a bank and establish the cost of goods sold.
a trading company, but “distribution” (supply chain)
alliances [of this type] have been formed of companies
ranging from raw material suppliers to retailers.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A measure (usually expressed as a percentage) of satisfying A computer application program that is old and interfaces
demand through inventory or by the current production schedule in poorly with other applications but is too expensive to
time to satisfy the customers’ requested delivery dates and replace. It often runs on antiquated hardware.
quantities. In a make-to-stock environment, [this] is sometimes
calculated as the percentage of orders picked complete from stock
upon receipt of the customer order, the percentage of line items
picked complete, or the percentage of total dollar demand picked
complete. In make-to-order and design-to-order environments, [it]
is the percentage of times the customer-requested or
acknowledged date was met by shipping complete product
quantities.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The actual portion of current market demand that a A quantitative forecasting technique based on applying past
company or product achieves. patterns of demand data covering introduction, growth,
maturity, saturation, and decline of similar products to a
new product family.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The strategy of planning and designing products so that The systematic gathering, recording, and analyzing of data about
components or subassemblies can be used in current and problems relating to the marketing of goods and services. Such
future products or assembled to produce multiple research may be undertaken by impartial agencies or by business
firms or their agents. Marketing research includes several types:
configurations of a product. [...].
(1) market analysis (product potential is a type) is the study of the
size, location, nature, and characteristics of markets; (2) sales
analysis (or research) is the systematic study and comparison of
sales (or consumption) data; (3) consumer research (motivation
research is a type) is concerned with the discovery and analysis of
consumer attitudes, reactions, and preferences.

APICS CSCP Learning System APICS CSCP Learning System

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modular system multicountry strategy

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obsolescence order losers

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order qualifiers order winners

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partnership passive tag

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 Definition Definition
A strategy in which each country market is self-contained. A system architecture design in which related tasks are
Customers have unique product expectations that are grouped in self-contained packages. Each package, or module,
addressed by local production capabilities. of tasks performs all of the tasks related to a specific function.
Advances in functions can be implemented without affecting
other packages or modules because of the loose coupling with
other modules. One example is a multitiered architecture in
which application business rules are separated from the data
management rules. Another example is a client-server
architecture in which user interface tasks are separated from
the application software.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
Areas or aspects of an organization in which poor 1) The condition of being out of date. A loss of value
performance can cause loss of business. For example, occasioned by new developments that place the older
failure to meet customer expectations with delivery of the property at a competitive disadvantage. A factor in
product is [this]. depreciation. 2) A decrease in the value of an asset
brought about by the development of new and more
economical methods, processes, or machinery. 3) The loss
of usefulness or worth of a product or facility as a result of
the appearance of better or more economical products,
methods, or facilities.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
Those competitive characteristics that cause a firm’s Those competitive characteristics that a firm must exhibit to
customers to choose that firm’s goods and services over be a viable competitor in the marketplace. For example, a
those of its competitors. [These can be considered to be firm may seek to compete on characteristics other than
competitive advantages for the firm. [They also] usually price, but in order to “qualify” to compete, its costs and the
focus on one (rarely more than two) of the following related price must be within a certain range to be
strategic initiatives: price/cost, quality, delivery speed, considered by its customers.
delivery reliability, product design, flexibility, after-market
service, and image.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A RFID tag that does not send out data and is not self- 1) A form of business ownership that is not organized as a
powered. separate legal entity (i.e., unincorporated business), but
entailing ownership by two or more persons. 2) In a supply
chain, a relationship based on trust, shared risk, and
rewards aimed toward achieving a competitive advantage.

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product differentiation product life cycle

management (PLM)

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project management pull system

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push system quality function deployment

(QFD)

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radio frequency identification return on assets (ROA)

(RFID)

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 Definition Definition
The process of facilitating the development, use, and A strategy of making a product distinct from the competition
support of products that customers want and need. Helps on a nonprice basis such as availability, durability, quality,
professionals envision the creation and preservation of or reliability.
product information, both to the customer and along the
reverse-logistics portion of the supply chain.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
1) In production, the production of items only as demanded The use of skills and knowledge in coordinating the
for use or to replace those taken for use. 2) In material organizing, planning, scheduling, directing, controlling,
control, the withdrawal of inventory as demanded by the monitoring, and evaluating of prescribed activities to ensure
using operations. Material is not issued until a signal comes that the stated objectives of a project, manufactured good,
from the user. 3) In distribution, a system for replenishing or service are achieved.
field warehouse inventories where replenishment decisions
are made at the field warehouse itself, not at the central
warehouse or plant.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A methodology designed to ensure that all the major 1) In production, the production of items at times required
requirements of the customer are identified and subsequently by a given schedule planned in advance. 2) In material
met or exceeded through the resulting product design process control, the issuing of material according to a given
and the design and operation of the supporting production schedule or issuing material to a job order at its start time.
management system. [It] can be viewed as a set of 3) In distribution, a system for replenishing field warehouse
communication and translation tools. [It] tries to eliminate the inventories where replenishment decision making is
gap between what the customer wants in a new product and centralized, usually at the manufacturing site or central
what the product is capable of delivering. [This] often leads to a
supply facility.
clear identification of the major requirements of the customers.
These expectations are referred to as the voice of the
customer (VOC).
APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
Net income for the previous 12 months divided by total A system using electronic tags to store data about items.
assets. Accessing or retrieving this data is accomplished through a
specific radio frequency and does not require close
proximity or line-of-sight access.

APICS CSCP Learning System APICS CSCP Learning System

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return on investment (ROI) semipassive tag

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service industry sourcing

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spend management strategic planning

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supply chain event supply chain management

management (SCEM)

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 Definition Definition
An RFID tag that sends out data, is self-powered, and A relative measure of financial performance that provides a
widens its range by harnessing power from the reader. means for comparing various investments by calculating
the profits returned during a specified time period. In the
theory of constraints, [this] is calculated as throughput
minus operating expense divided by investment.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The process of identifying a company that provides a 1) In its narrowest sense, an organization that provides an
needed good or service. intangible product (e.g., medical or legal advice). 2) In its
broadest sense, all organizations except farming, mining,
and manufacturing. Includes retail trade; wholesale trade;
transportation and utilities; finance, insurance, and real
estate; construction; professional, personal, and social
services; and local, state, and federal governments.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The process of developing a strategic plan. Managing the outflow of funds in order to buy goods and
services. The term is intended to encompass such
processes as outsourcing, procurement, e-procurement,
and supply chain management.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The design, planning, execution, control, and monitoring of A term associated with supply chain management software
supply chain activities with the objective of creating net applications, where users have the ability to flag the
value, building a competitive infrastructure, leveraging occurrence of certain supply chain events to trigger some
worldwide logistics, synchronizing supply with demand, and form of alert or action within another supply chain
measuring performance globally. application. [It] can be deployed to monitor supply chain
business processes such as planning, transportation,
logistics, or procurement. Can also be applied to supply
chain business intelligence applications to alert users to
any unplanned or unexpected event.

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supply chain resilience transportation management

system (TMS)

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universality value added

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value chain value stream

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value stream mapping value-added network (VAN)

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 Definition Definition
A computer application system designed to manage The ability of a supply chain to anticipate, create plans to
transportation operations. Typically offer modules focused avoid or mitigate, and/or to recover from disruptions to
on specific functions, such as intermodal transportation, supply chain functionality.
import/export management, fleet service management, and
load planning and optimization.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
1) In accounting, the addition of direct labor, direct material, The strategy of designing a product initially intended for
and allocated overhead assigned at an operation. It is the cost one market in such a way that it can also be sold in other
roll-up as a part goes through a manufacturing process to markets. A form of standardization.
finished inventory. 2) In current manufacturing terms, the
actual increase of utility from the viewpoint of the customer as
a part is transformed from raw material to finished inventory;
the contribution made by an operation or a plant to the final
usefulness and value of a product, as seen by the customer.
The objective is to eliminate all non-value-added activities in
producing and providing a good or service.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
The processes of creating, producing, and delivering a The functions within a company that add value to the goods
good or service to the market. For a good, [this] or services that the organization sells to customers and for
encompasses the raw material supplier, the manufacture which it receives payment.
and assembly of the good, and the distribution network. For
a service, [this] consists of suppliers, support personnel
and technology, the service “producer,” and the distribution
channel. May be controlled by a single business or a
network of several businesses.

APICS CSCP Learning System APICS CSCP Learning System

Definition Definition
A network, often supporting EDI, providing services A lean production tool to visually understand the flow of
additional to those provided by common carriers. materials from supplier to customer that includes the
current process and flow as well as the value-added and
non-value-added time of all the process steps. Used to lead
to reduction of waste, decrease flow time, and make the
process flow more efficient and effective.

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warehouse management web services

system (WMS)

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 Definition Definition
A common internet or intranet framework that enables the A computer application system designed to manage and
movement of data from one supply chain application to optimize workflows and the storage of goods within a
another, without the requirement for a direct connection warehouse. Often interfaces with automated data capture
between the two applications and without regard to the and enterprise resources planning systems.
underlying operating system for those applications.

APICS CSCP Learning System APICS CSCP Learning System