7.10 Key Terms
Key Terms
- Average aggregate inventory value refers to the total inventory held in stock, including raw materials, work-in-process, and finished goods, valued at cost.
- Barcodes, widely adopted since the 1970s, display machine-readable data that can be scanned by barcode readers, containing information like pricing, product numbers, and descriptions.
- Cash flow, or the flow of money, moves in the opposite direction to the material/goods flow.
- Collaborative Planning, Forecasting, and Replenishment (CPFR): enables trading partners (manufacturer and distributor/retailer) to collaborate on forecasting and order planning.
- Cross-docking involves transferring goods directly from inbound to outbound carriers, bypassing warehousing and storage.
- Distribution management refers to the process of overseeing the movement of goods from suppliers or manufacturers to the point of sale.
- Electronic Data Interchange (EDI) is a computer-to-computer exchange of business documents, such as purchase orders and invoices, in a standardized electronic format between business partners.
- Horizontal Integration: Horizontal integration involves a business expanding its holdings by acquiring or merging with another firm operating in the same market.
- Integration management serves as the glue that binds the other elements together. It leverages technologies such as Enterprise Resource Planning (ERP) systems to facilitate seamless collaboration and information sharing among the various components of the supply chain.
- Internal operations management focuses on the processes and activities through which a company adds value to its products or services.
- Inventory management is a critical activity within the supply chain, ensuring that materials and goods are available in the right quantities, at the right locations, and at the right time.
- Key Performance Indicators are measurements used to evaluate supply chain performance.
- Logistics refers to the coordination and movement of resources, particularly inputs into the transformation process and finished goods out to customers.
- Material/goods flow represents the physical movement of products along the supply chain.
- QR systems leverage barcodes and EDI to provide vendors with real-time sales data for prompt replenishment of goods in the correct quantities – a just-in-time (JIT) approach for retail.
- Radio Frequency Identification (RFID) utilizes radio waves to communicate data stored on tags attached to objects, such as product details, shipment information, and pricing.
- Socially responsible supply chain management encompasses a range of practices promoting ethical, environmentally conscious, and socially responsible operations throughout the supply chain.
- Supply chain design is a strategic decision that determines various entities’ roles, responsibilities, and geographical locations within the supply chain network.
- Supply chain refers to the interconnected network of organizations involved in fulfilling a customer order, from sourcing raw materials to delivering the final product.
- Supply management encompasses the procurement and management of suppliers and the cultivation of strong relationships with them.
- Vendor Managed Inventory (VMI) is an advanced supply chain relationship where a vendor manages and maintains agreed inventory levels at the customer’s location, leveraging access to real-time inventory data.
- Vertical Integration: Vertical integration occurs when a firm owns more than one portion of its supply chain.
