A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

GO TO Aa, Ab, Ac, Ad, Ae, Af, Ag, Ah, Ai, Aj, Ak, Al, Am, An, Ao, Ap, Aq, Ar, As, At, Au, Av, Aw, Ax, Ay, Az, last entry

802.11: Wireless technology allowing data to be sent very rapidly from a central transmitter to devices such as laptops.

A Class Items: A general meaning of this term is the most important items. When a group of products is analysed according to some criterion and the individual products in the group ranked - ie placed in order - according to the criterion used, it is common to subdivide the products in the ordered list into three categories. The "A" category, or A Class, products are those products at the top of the list; the "B" category products are next, and the "C" category products are those at the bottom of the list. A common criterion applied in the analysis of the original group of products is according to each product's "annual value". Annual value is often thought of as reflecting a product's importance, and is defined as the product's annual usage multiplied by its unit value. (For example, if 200 products are used per annum and one unit costs £7, the annual value is £1,400.) It will typically be found that if the A Class items are defined as the top 20% of the items at the top, that they account for 80% of the total value of all the items. See ABC Classification and the vital few.

ABAP: Advanced Business Application Engineering.

ABB: Activity Based Budgeting.

ABC: In costing, Activity Based Costing (qv).

ABC Classification: The division of products in a group into three sub-groups: Group A, Group B and Group C. Division is usually accomplished by the following three step process: (1) the calculation for each product of its annual value, this being its "annual usage x its unit value"; (2) the ranking, or ordering, of all the products into an order based on their annual values, as calculated in Step 1, thus forming a list of products in descending order of annual value; and (3) the sub-division of the list in Step 2 into three groups according to Pareto principles. (The Pareto principle is that the top 20% (approx) of the products in the ordered list will account for some 80% of the total annual value of all the products together.) Thus the products in the list are split into the top group, called "A" (20% of the products, but 80% of the total annual value), the next group "B" (say, 30% of the products, about 15% of the total annual value) and the bottom group "C" (50% of the products, 5% of the total value). In fact, the split is arbitrary and it may be preferable to subdivide the products in other ways (eg the top 10% A, the next 15% B and the bottom 75% C). It may also be desirable to create a fourth group D - say, the bottom 20%, perhaps representing a mere 1% of the total annual value. Note also that if A products are to be looked after closely, and C products not at all so, then it may be desirable to promote a few "line stoppers" from Class C to Class A. The notion of the vital few and the trivial many is widely used. For example, in quality, Dr Joseph Juran maintained that 80% of trouble was caused by 20% of the problems, so, he recommended, fix the 20% as first priority!

ABCD Checklist: The late Oliver Wight, and, through him, the MRP training company that bears his name, have established an assessment and scoring system whereby companies that have installed MRPII can judge how well they have succeeded. Originally, there were 20 or so criteria, and the rating of a company (Class A, Class B, Class C and Class D) was simply a bit of fun. In Wight's eyes, Class A companies are using the system and literally working to the numbers it produces; Class B are using the system but still retain "little black books", Class C are running the system but not using it, and in Class D companies only the computer department ever see the output! There are now over 300 criteria and the process is taken very seriously. Very few companies - perhaps 20 in the UK - have attained Class A. Instead of concluding from this that it is MRP which is the problem, the promoters of this methodology conclude that the problems lie with the staff of the Class B to D companies (who clearly did not spend enough money on training).

Abnormal Demand: See Non-Consuming Demand and Unreasonableness Checks.

Absenteeism: This phenomenon relates to employee absence from work which, so far as the employer is concerned, is unauthorised and therefore unanticipated. A company analysing absenteeism among its employees may distinguish between absence due to illness, supported by medical evidence, and absence due to other reasons. For a company department, a percentage measure of absenteeism is: (total number of staff days lost) / (total number of staff working days) x 100%.

Absorption Costing: See Costing (Absorption).

ACAS: Advisory, Conciliation & Arbitration Service, a UK Goverment body with branches throughout the country, offering advice and assistance on matters to do with employer/employee law and relations. Visit http://www.acas.org.uk.

Acceptable Quality Level (AQL): If a supplier sends parts to a buyer, then the two parties may agree that a sampling plan should be used by the buyer to validate their quality on receipt. Among other things, the sampling plan will be selected on the basis that the incoming parts are to be at an agreed quality level of "p%" or better. Naturally, the supplier of the items wishes to be assured that if the quality of parts he actually sends is indeed equal to or better than p%, then there will be a very high probability that they will be duly accepted under the plan (ie that the plan will not result in their rejection). On the other hand, the recipient wishes to be assured that if the quality of the goods he receives is worse than p%, then there is a very high chance that they will be rejected. In summary, the term acceptable quality level means the level of quality (p%) at which a sampling plan is liable to result in the parts' acceptance. In fact, the "Dodge-Romig/Military Plans" plans give the supplier 95% assurance that if quality is at p% or better, material will be accepted. Note therefore that the word "acceptable" means, literally, "liable to acceptance" - it does not have the alternative common English meanings of "welcome" or "satisfactory". See AQL sampling tables. See also ATI.

Acceptance (of Goods): A formal acknowledgement by a recipient that goods which have been physically delivered are satisfactory with regard to their identity (ie type), quality, quantity and other matters of central concern in the contract. By the Sale of Goods Act 1979, goods which are merely delivered are not deemed to be accepted until the recipient has been given a chance to inspect them or until a reasonable time has elapsed (without the recipient saying he rejects them) or unless the recipient begins to use the goods. The significance of legal acceptance is that the buying company thereby acknowledges that the main points of the contract have been fulfilled, and so cannot terminate the contract for breach of conditions. See Section 2.3.3 of the free on-line purchasing course at this site and sub-section 3.4.2 of the on-line course on stores, also at this site.

Acceptance of Offer (by Post, Fax or E-mail): The convention is adopted in law that a party is deemed to accept a contractual offer at the moment he posts a letter saying he has so accepted it, not when the letter is actually received. This convention applies only to an acceptance: it does not apply, for example, to other matters such as counteroffers, revocations or the making of offers themselves. When the party transmits his acceptance of an offer by fax or e-mail, acceptance is deemed to take place when the transmission is actually received by the other party, not when it was sent.

Account (An): A logical grouping of either receipts, expenditures, stocks or transactions relating to some particular activity having financial consequencies. Examples of accounts are: the VAT account; the wages account; the copper raw materials account; the fuel expenditure account etc. (The term "accounting" originally meant the management of these accounts.)

Accounting Equation: In financial accounting, the accounting equation relating to a company's finances is: (assets + expenses) = (capital + liability + revenue). The effect of the equation may be summarised thus: if there is an increase in the company's assets, or if there is an incurrence of an expense, the increase must be balanced by a corresponding increase in liabilities, or capital, or revenue. These principles are incorporated in "double entry bookkeeping".

Accounts (Type of): Asset accounts, expense accounts, liability accounts, capital accounts and revenue accounts.

Accuracy (of a measurement). A measurement process that has a small variability is said to have high precision. This does not mean, however, that the measured value is the true value. If the measured value is M and the true value is T, then the total error = M - T. This expression can be split into Total Error = (M - dx) + (dx - T). The first expression (M - dx) is the random deviation inherent in making any measurement - random error that can be "averaged away" by taking many repeated measurements. The second expression (dx - T) is bias due to a systematic fault in the measuring process (perhaps due, say,to an uncalibrated instrument). Bias can only be detected and removed by investigation. The term (dx - T) can be found by averaging many measurements, and is referred to as the accuracy of the measuring process. 'Accuracy' in the context of stock records accuracy is dealt with in Section 1.4 of the free on-line course on Stock Records Accuracy, at this site.

ACE: Automated Commercial Environment.

Ackoff, Russ: see Systems Thinking.

ACSI: American Customer Satisfaction Index - a metric devised by the ASQ and others attempting to express and track customer satisfaction as delivered by a wide range of companies and government institutions.

Action Date: The day that the next action on a part is scheduled to take place.

Activity Based Costing (ABC): A costing procedure devised by Robert Kaplan (*) and Robin Cooper in 1988 whereby the costs incurred in manufacturing are not accumulated by geographic area, and then assigned to products based on a simple "cost driver", such as the number of employees in the area, but instead are accumulated by type of activity undertaken. Examples of activities are machine set ups; quality management; purchase order placement; etc.. The costs incurred in these activities are then allocated to products based on the demand the products make on the activities. The argument against the adoption of ABC is that action taken by staff to reduce the demand of a particular product on an activity, and so reduce its cost, are likely to be disruptive. For example, a manager may reduce the demand of a product on purchase placement costs by ordering very large lots of material at infrequent intervals. (*Kaplan is also co-inventor of the balanced scorecard, qv.)

ACV: All Commodity Volume.

Adaptive Exponential Smoothing: Devised by Derek Trigg originally in connection with the tracking of the Nylon 8 process at ICI in Wilton, Co. Durham, Adaptive Smoothing is the only naive forecasting technique to incorporate a built-in ability to adapt its own behaviour as circumstances change. The exponent alpha in single exponential smoothing is replaced by a variable "A", calculated from the past "n" forecast errors, where A = (sum of the errors where signs cancel) / (absolute sum of the errors). In short, as errors start to increase, A gets bigger and the forecasts start to catch up to the new level of demand. Adaptive smoothing is not a sound forecasting technique and is no longer used; it is regarded as a curiosity.

ADC: Analogue to Digital Converter, or Automated Data Collection.

Added Value: see Value Added.

ADC: Automated data capture.

ADE: Automated Data Entry.

ADSL: Assymmetric Digital Subscriber Line, a methodology enabling a single copper wire carrying a telephone signal to transmit data at anything from 10x the normal rate to 40x the normal rate - ie it is a digital connection over a normal telephone line that is also capable of carrying high speed traffic. "Asymmetric" means that the user cannot send ("upload") data as fast as he can receive it. As well, what is important from the user's point of view, is that the connection is "always on". ADSL Max denotes new technology intended to improve performance, especially for users a long way from the telephone exchange.

Ad Valorem: A customs duty levied according to the value of the goods.

Advance Shipping Notice: see ASN.

Advanced Planning and Scheduling: See APS.

Advice Note: A message from a supplier to a receiving company stating that goods ordered are in the process of being actually despatched. The advice note may be paper or electronic, and will include the relevant Order Number. An advice note is equivalent to an ASN.

AEG: Allgemeine Elektricitäts - Gesellschaft.

AEI: Associated Electrical Industries.

AEN: Ambient electromagnetic noise. The electrical and magnetic waves measured in decibels that are generated in the air by electrical devices - sortation systems, conveyors, alarm systems, radio VDUs etc.. A major problem with AEN lies in the installation of RFID - the radio waves generated and read by the RFID devices are interfered with by the AEN. Prior to setting up an RFID system, therefore, it is necessary to carry out a site assessment or site survey. In the site assessment, a Full Faraday Cycle Analysis is performed over a 24-hour working day of the proposed RFID interrogation zone to determine the AEN present. By doing so, RFID readers can be positioned so as to minimise AEN radio interference. The subjects of AEN, site surveys and Full Faraday Cycle Analyses remind us that in setting up an RFID system, in, say, a warehouse, problems are as much matters of physics and electronic engineering as they are of systems analysis.

AEU: Amalgamated Engineering Union.

AFI: Average Fraction Inspected. A term used in quality and acceptance sampling to gauge the financial effectiveness, to a recipent of incoming goods, of a sampling inspection table or procedure. AFI is defined as ATI / N, where N is the number of the incoming items.

Agent (legal): An employee is the "agent" of an employer, whose function it is to assist the employer in the fulfilment of a contract. The limit of the agent's contractual involvement is that a contract of agency exists between him and his employer, and it is from this that he derives his authority to act. Such authority may be express, implied, apparent, ratified or of necessity. In general, the principal (ie employer) is bound by his agent's actions. This is not the case, however, if the agent acts contrary to the employer's specific instructions.

Agile Manufacturing: Agile is an adjective from the Manufacturing Consultant's Golden Lexicon - a powerful word suggesting immediately that a company that is not agile is inferior to one that is (but we are not to enquire in what way the non-agile company is inferior). If agile manufacturing does have a meaning, it is that the company responds to a customer's requirement by the immediate commencement of fast manufacture, rather than through a reliance on forecasting and stock holding. Two examples of agile manufacture are: (1) in Just-in-Time, the instant response to market demand, through group technology, kanban and SMED; and (2) in quick response/assemble-to-order, the prior manufacture of machine options and their use in a final assembly stage.

AGV (Automated Guided Vehicle): A computer controlled device used in materials handling and factory internal transportation.

AID: Automatic Identification .... bar codes, RFID and contact memory buttons.

AIDAS: The tasks which the salesman must undertake in selling have been summarised by the mnemonic AIDAS, as follows: A = attention (making contact); I = interest; D = desire (showing the potential customer how the goods will benefit him); A = action (closing the sale); and S = satisfaction (making sure the business is retained).

AIM: (1) Application Integration Middleware; (2) Alternative Investment Market, a branch of the London Stock Exchange formerly known as the Unlisted Securities Market, launched in 1995 and having less stringent rules and regulations than the main stock exchange. The AIM was aimed at smaller, younger companies.

AIMS: Agile Infrastructure for Manufactured Systems (a program).

AIT: Automatic Identification Technology (Auto ID) ... bar codes, RFID and contact memory buttons.

ALE: Application Level Events (Standard). A software standard connected with RFID which deals with the collection, management and routing of data. (For example, an RFID reader is capable of multiple readings of the same RFID tag in a fraction of a second ... this "dirty data" must be filtered.) See also GEN2.

All Time Order: See All Time Supply.

All Time Supply: An expression coined by R. G. Brown to mean that quantity of stock that would just satisfy all remaining future demand for a product. Brown's use of the expression is in the calculation of the total potential remaining demand for a spare part related to a machine assembly, where the machine assembly itself has been discontinued by the manufacturer. For a few short years in this situation, the demand for spares for the main (discontinued) machine is normal and in accordance with normal service requirements. But as the discontinued machines remaining in the marketplace are withdrawn from service or are scrapped, it is found that the demand for spares for the surviving machines declines at an even rate, year on year. For example, the demand for spares in Year 2 may be 80% of the demand in Year 1, and the demand in Year 3 may be 80% of the demand in Year 2. The rate of decline is a geometric series, which can therefore be summarised: if demand in one year is D and the rate of decline per year is L, the summation to infinity is D x L / (1 - L). For example, if the demand in one year is 100 units and the rate of decline of sales is 0.8 per year, the total remaining demand is 100 x 0.8 / (1 - 0.8), or 400 units. If the company guarantees providing spares for 5 years after withdrawal of the main machine, the demand over the 5 years can be readily calculated ( 100 x 0.8 + 64 x 0.8 + ... = 269 units). Consequently, in this case, by manufacturing a single lot of 400 units to cover the all time supply, and notwithstanding the cost of holding stock, the company is providing for the likely demand in its guarantee period, plus a "safety stock" of 131 units. An example in which the All Time Supply calculation might have been useful is the discontinuation in 2007 by the retailer PC World of sale of floppy disks due to ever-declining sales, to the detriment of a decreasing number of customers wanting them.

Allocation: see Stock (Allocated).

Allocation Basis: See Cost Driver.

Alpha Risk: See Producer's Risk (in sampling).

Alphanumeric Code: "Alpha" means allowing letters of the alphabet, and "numeric" means numbers 0 to 9. Thus an alphanumeric code is one potentially containing letters (A, B, C and/or a,b,c ...) and numbers (1, 2, 3 ...). The number on a UK car number plate is alphanumeric (eg R754ORX).

Alternative Investment Market: see AIM meaning (2).

Always-on: a permanently open connection (a term usually used in relation to the Internet).

AM: Amplitude Modulation.

Amalgamated Society of Engineers: A former craft trade union in engineering.

AMH: Automated Materials Handling.

Amortisation: synonymous with depreciation.

Analysis of Features: In the design of a new product, "analysis of features" is a formal method, employing a matrix, for analysing competitive products. See also parametric analysis.

Ancestor: A material anywhere within a product's bill of material at a lower level. Thus if A and B are used to make material C, A and B are C's ancestors. If D is used to make A, D is also C's ancestor.

Andon Board: In Just-in-Time and lean manufacture, a large electronic board suspended from the ceiling in the workplace bearing constantly updated figures relating to achieved and target production. The andon is also used to communicate warnings on quality and production flow through a simple coloured light system

ANN: Artificial Neural Networks.

Annual Stock Check: Stock which is manufactured by a company is regarded from the financial viewpoint as an investment waiting to be sold. Consequently, in order to strike the balance sheet at the end of its financial year, the company must report its stock, valued at cost price, as part of its current assets (*). If the stock records are not reliable and there is no programme of cycle counting in place, a major counting exercise must be embarked on to do so, usually over a short period such as a long weekend. The annual stock take is a significant cause of errors in stock records since the counting performed is often not accurately done and discrepancies between the counts recorded and the stock records are not verified or investigated as they should be, due to pressure of time. Other causes of error in annual stock counting are: (1) failure to prepare the stores or warehouse for the counting exercise (eg by tidying the environment and making sure everything is correctly labelled); (2) employing inexperienced staff to perform the counting; (3) rushing the counting exercise through the imposition of a completion deadline. If a company has reasonably good records accuracy and a cycle counting programme in place, it should definitely not allow annual stock check figures to overwrite the records. For practical notes relating to the annual stock count, visit the free on-line course Stock Records Accuracy, at this site (Section 5.1 and possibly 5.2). (* Current assets are assets which are cash or will soon become cash, as opposed to fixed assets such as land and buildings.)

Annual Usage Value (AUV): The quantity of a material used per annum, multiplied by its unit cost. The figure is widely used in ABC Classification, since it reflects both a material's commercial and manufacturing importance. See also DGR.

ANOVA (Single Factor, analysis of variances): The conduct of a process or procedure may give rise to certain outputs which are recordable as quantitative data. For example, a job shop produces units of output in the course of a day, and the number of units produced may be recorded, say, as 100 pieces. However, the process can proceed under alternative factor levels (qv), or alternative conditions. The recorded output from the process may then be different depending on the particular, unique factor or condition prevailing. For example, the number of units of output produced by the job shop in the day may be different depending whether the day is Monday, or Tuesday, or Wednesday, or Thursday or Friday. Single factor ANOVA is used to determine whether the differences in output emanating from the alternative levels of a particular factor are statistically significant. For example, it may be used to determine whether the job shop's output is dependent on the day of the week.

To begin, the analyst must first calculate the variance of the observed data at each factor level (eg the variance in the output figures as observed for each of the days of the week.) Next, two statisical measures are calculated. The first, SST, is known as the Between Treatments(*) Variation, or "sum of the squares for treatment". The SST is a meaure of the closeness, or difference between, the variances calculated. The second statistical measure is known as the Within Treatment Variation, or "sum of the squares for error" (SSE). This is a measure of the variation within each set of observed data. Finally, both the SST and SSE are adjusted for statistical averaging purposes to take account of the number of degrees of freedom (qv) permitted, to give the MST (mean square for treatment) and the MSE (mean square error). The last step is to calculate MST/MSE, known as the test statistic F. If F is sufficiently large (greater than 1, but probably much greater), then there is statistical significance as a result of the alternative factor levels (eg that the job shop output on Monday is significantly different from the output on Tuesday, from ... Friday). ANOVA is widely used in industry, including at the Analyse phase of Six Sigma. Naturally, the analyst so using it need not be concerned with the statistics ... all he need do is enter the numbers on, say, a MINITAB screen! Note that multifactor ANOVA allows significance to be explored when several factors themselves are present. For example, the output observed between the days of the week, but also qualified by which season of the four seasons of the year is involved - Mondays in Summer, v. Tuesdays in Winter .... (* The term "treatment" used in ANOVA and DOE harks back to the experiments of Sir Ronald Fisher in 1915, using ANOVA and DOE to investigate the yields from potato crops with different types of types of potato and different types of manure.) See also The Null Hypothesis.

ANS: Advanced Networks and Services.

ANSI: American National Standards Institute.

ANSI/ISO/ASQC Q9000: The US terminology for ISO 9000 (qv).

ANSI ASC X.121 : also known as X.12, a technical standard for the transmission of EDI messages over telecommunications links. The dominant standard in North America, Australia and New Zealand.

Anticipated Delay Report: A printout or VDU display showing which works orders will be completed later than their planned due dates.

Anticipation Stock: see Stock (Anticipation).

ANX: Automotive Network Exchange.

AOC: Appelation d'origine controllee - 'designation of original hallmark', being a status granted by the French government to more than 300 food and drink products, mainly wines and cheeses. An AOC designation is an assurance that the product has come from a specified geographical area.

AOG: Aircraft on (the) ground - the ultimate horror for stockists of aircraft spares, apparantly justifying the abandonment of scientific inventory principles and the storage of gross and wildly excessive levels of stock.

AOI: Automated Optical Inspection.

AOQ: Average Outgoing Quality. The quality level of parts which have been subject to sampling. The level will be affected by the probability that certain lots will be rejected, and that, as a consequence, these lots will be 100% inspected. Since there has been 100% inspection of some of the parts, with rectification of any defects found, the overall outgoing quality will be improved. (If all lots are liable to be rejected by sampling, outgoing quality will be 100%.)

AOQL: Average Outgoing Quality Limit. The worst possible outgoing quality associated with items that have been subject to a particular sample plan (see AOQ).

Appellation Controllee: see AOC.

API: Application Program Interface.

APICS: The American Production and Inventory Control Society. Visit www.apics.org.

APO: Advanced Planning & Optimisation.

APQP: Advanced Product Quality Planning.

APS (UK - Advanced Planning & Scheduling System; US - Advanced Planning System): A comprehensive planning and operational control system based on proprietary software and comprising a number of distinct modules, or sub-elements. The sub-systems include MPS, Forecasting, BOM and many others common to MRPII and ERP. However, a notable absentee among the modules is Closed-Loop MRP. The day to day plan control which is effected by Closed-Loop MRP in an MRPII/ERP system is replaced in an APS by a Finite Scheduling "Engine". That is, what is at the heart of an APS is the capability to produce a realistic schedule of work detailing the order of jobs, start and finish times and so on, taking account of practical scheduling and production rules and the desirability of optimising throughput. Unlike the cumbersome manner of MRP, APS provides for interactive interrogation of the scheduling situation and interactive resolution of problems (eg planning difficulties due to plant breakdowns). See also Finite Capacity Scheduling.

AQL: See Acceptable Quality Level.

AQL Sampling Tables: See Sampling Tables (AQL or Military).

ARIMA (Autoregressive Integrated Moving Average): A refinement of ARMA, and better known as Box-Jenkins Technique (qv).

ARMA (Autoregressive Moving Average): A causal forecasting technique and the forerunner of ARIMA.

Articles of Association: along with the Memorandum of Association (qv), one of the two key founding documents of a company, the Articles setting out internal company rules and regulations as they affect shareholders and directors.

asap: "as soon as possible" - office jargon.

As is: A statement that the supplier of goods will not be responsible for the condition or quality thereof after the buyer receives them. Note importantly, that the statement has no legal effect unless it was agreed between the supplier and buyer beforehand at the time the contract was formed. In other words, "received as is" has no validity if it appears for the first time writen on a delivery note.

ASC: Accounting Standards Committee.

Ascertained Goods: Ascertained goods are a seller's stockholding of particular goods from which a buyer's order has already been picked or put to one side. That is, the goods have been identified and selected for sale. See also unascertained goods.

ASCII: American Standard Code for Information Interchange. A worldwide standard of 128 seven bit binary character codes used in computers to represent characters (ie numbers, the alphabet and punctuation marks etc.).

Aseptic, Aseptic Handling: Aseptic means "not liable to putrify, preventing putrefaction" (OED), hence aseptic handling in stores terminology means handling in a constant state of hygiene; when so handling, there must be a flawless level of air-tight, germ free sanitation. To achieve this, it is usually necessary to employ special plastic IBCs, which have been subject to stringent pre-treatment/cleaning. A popular aseptic vessel used in IBC aseptic handling is the 1000 litre 'Combo' from Schoeller Arca Systems.

ASN: Advance Shipping Notice, or Advance Shipping Notification. An Advice Note (qv) - a document sent either electronically or by some other means to a customer informing him that actual despatch of an accepted order has commenced. The data on an ASN will typically include the customer order number and purchase order number, and, for the goods despatched, SKU/product code numbers and quantities, lot numbers, pallet/ container numbers; and carton numbers. A slightly risky means available to the customer for updating his records is to enter data direct from the ASN, and "backflush" the data automatically when the shipment is actually received.

AS/RS: Automated Storage & Retrieval System - a planned combination of materials handling devices and materials storage media forming a single integrated system. Depending on the vendor's specification, an AS/RS type might be a miniload AS/RS; a unit load AS/RS; an order picking AS/RS; a human-aboard AS/RS; or an end-of-aisle AS/RS.The typical function of an AS/RS might be that a shuttle travels to the picking location to retrieve the items to be picked and delivers them to a station, a dispenser then dropping them into a container or onto a conveyor for eventual removal and despatch.

Assemble-to-Order: see two-level master scheduling.

Assembly: A structure or machine which is put together (or "built") by fitting together two or many sub-assemblies. By contrast, a sub-assembly usually has a defined, single function within the overall assembly in which it is incorporated. Sub-assemblies themselves are likely to be built from individual product components.

Asset (Current): Assets which are expected to be turned into cash in due course, or consumed in the course of operations. Current assets are entered in the balance sheet in increasing order of liquidity (ie stocks, then debtors, then cash itself).

Asset (Fixed): Buildings, land and equipment acquired by the company and which have a continuing use in its business. Fixed assets are entered in the balance sheet in descending order of permanence (ie land first, then buildings ...). Small items such as typewriters are usually omitted.

Asset (Intangible): an asset having no physical existence but which is nevertheless identifiable and controllable - four examples of many are the ownership of licenses, patent rights, trademarks and brand names.

Asset (Monetary): An asset having a stated, unequivocal value (eg cash and debts).

Asset (Non Monetary): An asset which must be sold in the market, and therefore has a value that is not definite (its value depends on what the market will pay!).

Asset (Wasting): A wasting or sinking asset is a fixed asset that is steadily declining in value, with no hope of recovery in its value. An example is a mine which is being gradually depleted of minerals as mining takes place.

Asset turns: a measure of company performance, defined as (sales revenue)/(total assets). Thus with sales of £25m and total assets of £5m, asset turns are 5.0. Also see stock turns.

Assumption of Constancy: The reasonable contention that the forces which lead buyers in the marketplace to purchase goods are rationally based, although liable to change. The rational behaviour of buyers ... the assumption of the constancy ... stands behind the validity of sales forecasting (and much else).

ATI: Average Total Inspection. A term used in quality and acceptance sampling to gauge the financial effectiveness, to the recipient of goods, of a sampling / acceptance procedure.The ATI is defined as the sum of two costs: (1) the cost of the required inspection of the sample taken of the incoming parts, and (2) the cost of the required inspection of incoming lots that have been rejected by the sample plan, even though their quality was at the level of quality agreed as being satisfactory. As far as cost (2) is concerned, the possibility of rejecting incoming lots which prove on later 100% inspection to be satisfactory is inherent in the very activity of sampling. Clearly, however, the lower this possibility, the better the sampling plan and methodology. Cost (2) cannot be completely eliminated except through 100% inspection of incoming parts. However, cost (2) can be reduced in some sampling methodologies if larger samples are taken - ie if cost (1) is increased. For superior, effective sampling, a balance should be found such that the total of cost (1) and cost (2) is minimised. Perhaps a more popular measure than ATI is AFI, Average Fraction Inspected. This is defined as ATI / N, where N is the number of the incoming items.

ATO: Assemble to Order.

ATP: see Available to Promise.

AT&T: American Telephone & Telegraph Co. Inc., with headquarters in New Jersey, affectionately known as Ma Bell.

Attenuation: reduction. For example, the attenuation of a radio wave's power as the distance from its origin is increased. (In the case of a radio wave, the attenuation follows the inverse square relationship - ie as the distance doules, the original power falls to a quarter.)

Attribute Control Chart: In quality and SPC, an "attribute" is a particular undesirable quality characteristic such as a blemish, spot, hole or crack in a manufactured object. One method of monitoring a manufacturing process with regard to the production of manufactured objects is to take a sample every so-often, and inspect each part for the presence of any undesirable quality attribute. (A sample of 50 parts might be taken.) The number of parts having one or more attributes is then plotted on a graph (the horizontal axis representing time, the vertical axis the percentage of parts with one or more undesirable quality attributes). See also Count Chart.

ATR: Automated Trouble Reporting.

Audit Trail: See Transaction Trail.

AutoID: Automatic Identification Technology ... bar codes, RFID and contact memory buttons.

AUV: annual usage value, qv. See also DGR.

Autarky: Self sufficiency (see Industrial Autarky).

Autonomous Maintenance: The principal component of TPM (Total Productive Maintenance (qv)), since it may be said that shop floor workers have a unique knowledge of their machines. To make autonomous maintenance a reality, managers must be willing to give operators the freedom to make their own decisions about machine performance and machine adjustments, and must provide the training necessary to enable them to do so.

AV: Audio Visual.

Availability (of a Machine): usually defined as (loading time - down time) / loading time. Synonymous with uptime.

Available Hours: The total time available at a work centre over a period of time (usually one week).

Available-to-Promise: It is essential, if customer orders are to be delivered on the dates promised, that such orders do not exceed the company's commitment to future manufacture (ie do not exceed the company's declared master schedule. To ensure that this is so, a portion of the available master schedule effort is allocated to each customer order as it is accepted. That portion of the master schedule effort which has not been so allocated remains "available to promise (to future customers)". See also Capacity Available to Promise, and Capable to Promise.

Average Total Inspected: see ATI.

Az: A shorthand calculation used in SPC.

 

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