Terms Definition Assemble-to-order Assemble-to-order is a production strategy where key components are stocked in anticipation of customer orders.

Assembly is triggered by receipt of an order. This is useful when a large number of products use common components. Capacity requirements planning (CRP) The function of establishing, measuring and adjusting limits or levels of capacity, determining the amount of labour and machine resources required to accomplish the tasks of production. Cumulative lead-time Cumulative lead time is the longest planned length of time to accomplish the activity in question. For any item planned through MRP, it is the longest lead-time in the bill of materials item list. Delivery lead-time Delivery lead time is the time from receipt of a customer order to the delivery of the product. Distribution The activities associated with the movement of material, usually finished goods, from the manufacturer to the customer. It includes all activities related to physical distribution as well as the return of goods to the manufacturer. Engineer-to-order Engineer-to-order products are those with customer specifications that require unique engineering design or significant customization. Each customer order requires a unique set of part numbers, bills of material and routings. Industrial engineering The engineering discipline concerned with facilities layout, methods measure and improvement, statistical quality control, job design and evaluation, and the use of management sciences to solve business problems. Lead time Lead time is the span of time required to perform a process. Make-to-order Make-to-order is a production strategy where a product or service cans be made after receipt of a customer's order. The final product is a combination of standard items and customized items. Make-to-stock Make-to-stock is a production strategy where products are finished before receipt of a customer order. Customer orders are filled from existing stocks of finished goods and production orders are used to replenish those stocks.

Master production schedule (MPS) The anticipated build schedule for those items assigned to the master scheduler. It becomes a set of planning numbers that drive material requirements planning. The MPS represents what the company plans to produce expressed in quantities and dates. Material requirements planning (MRP) A set of techniques that uses bill of material data, inventory data, and the master production schedule to calculate requirements for materials. It makes recommendations to release replenishment orders for material and to reschedule orders. Materials management The grouping of management functions supporting the complete cycle of material flow, from the purchase and internal control of production materials to the planning and control of work in process to the warehousing, shipping and distribution of goods Plant layout Configuration of the plant site with lines, buildings, major facilities, work areas, aisles and other data such as department boundaries. Process layout Process (or functional) layout groups operations of a similar nature together. Quality Conformance to requirement or fitness for use. Resource planning (RP) Capacity planning at the business plan level .this establishes and measures long-range capacity. It is based on the production plan but may be driven by higher level plans such as the business plan. It addresses long range planning issues. Rough-cut capacity planning (RCCP) The process of converting the master production schedule into requirements for resources such as labour, machinery, warehouse space, supplier capabilities. Demonstrated capacity is examined for each key resource. Sales and operations planning(S&OP) A process that provides the ability to direct business to achieve competitive advantage by integrating customer-focused marketing plans for products with the management of the supply chain. The process integrates all the plans for the business.