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SupplyChainandOperationsManagementGlossary4July©LINDOSystems2003ThisglossarywasoriginallycompiledinconjunctionwithacourseonLogisticsandSupplyChainManagementattheUniversityofChicago.Entriestendtobearrangedaccordingtotheirabbreviation.Thus,Bill-Of-MaterialisdefinedunderBOM.Thereasoningisthatitiseasiertodeducetheabbreviationfromaphrase,thandeducethephrasefromtheabbreviation.3PL(ThirdPartyLogistics):Theuseofanoutsidepartytoperformsomepartofthelogisticsfunction,typicallytruckingorwarehousing.Itisappropriateifthereareeconomiesofscaleinthelogisticsfunction.ABCAnalysis:Partitionofproductsintothreegroupsaccordingtotheiryearlydollarvolume.Atypicalresultisthat30%oftheproducts(theA’s)comprise70%ofthevolume.MoresophisticatedcontrolproceduresareappropriateforclassAproducts.Verysimple,cheapmethodssufficeformanagingclassCitems.ThisissimilartoParetoanalysis.ABC(ActivityBasedCosting):Anaccountingmethodthatattemptstocloselyassociatecosts,particularlyindirectcosts,withtheactivitiesthatgeneratethecosts.Thisissometimesalsocalledtransaction-basedcosting.ThemostcrucialaspectofABCisidentifyingthe“costdrivers”(e.g.,numberofstopsonadeliveryroute,numberofmilesonadeliveryroute,numberofpalletsdelivered,etc.)andthendeducingthecostratetoapplytoeachactivity.A.C.Nielsen:AChicagobasedsupplierofindustrysalesdataforconsumerproducts(e.g.,supermarkets).Thesedataareobtainedfromsourcessuchascashregisterscanners.AnothersupplierofsuchdataisIRI.Acre:unitoflandmeasure=4840squareyards=0.4049hectares.640acres=1squaremile.SeeSIunits.AGV(AutomaticGuidedVehicle):adriverlessvehicleusedinwarehousesandfactoriestomovematerial.Itcanreplaceforkliftsforsometasks.Usuallythematerialtobemovedmustbeonastandardpallet.Initsmostautomatedform,whenapalletistobemovedtoanewlocation,theAGVsystemisinformedoftheoriginandthedestinationofthedesiredmovement.AnAGVwillpickupthepallet,navigatethroughthefactoryfollowingeitherwiresormagnetsburiedinthefloororlaserbeams.AnAGVmaybemanagedbyaWMS.AICPA(AmericanInstituteofCertifiedPublicAccountants).ANSI(AmericanNationalStandardsInstitute):see(AccountsPayable):Listofamountsduetooursuppliers.Softwaresystemfordecidingwhentopaywhichbillsbasedupondiscountsandpenaltiesthatdependuponwhenpaid.AR(AccountsReceivable):Listofamountsduetousbycustomer.Softwaresystemformonitoringandupdatingamountsdueandhighlightingaccountsaccordingtotheirneedforattention(e.g.,morethan30dayspastdue,morethan60dayspastdue,etc).ASA(AverageSpeedofAnswer):Astandardmeasureofservicequalityinin-boundcallcenters.Atypicaltargetis20secondsorless.IntheUS,thetimebetween“ring”tonesissixseconds,sothiscorrespondstoalittleoverthreerings.ASN(AdvanceShippingNotice):Anelectronicmessagefromtheshipper(orsupplierorsender)tothecustomer(orreceiver)thattheproducthasbeenshippedandisexpectedtoarriveduringaspecifiedtimeinterval.2ASP(ApplicationServiceProvider):Afirmthatprovidesbothcomputingpowerandbusinesssoftwaretobusinessesviatheweb,somewhatsimilartotimesharingfirmsinthe1970’s.AbusinessthatusesanASPcanbebilledpertransaction,sothatasmallfirmmightbeabletouseapowerfulpieceofsoftwarewithouthavingtopayahighfixedlicensefeeforit.Anotheradvantageisthatthedetailsofsoftwaremaintenanceandupgradesareinvisibletotheuser.AriskinusinganASPisthattheASPmayfaileitherphysicallyorfinancially,inwhichcasethebusinessthatusesitmayhavelessrecoursethanifitsinformationprocessingwasdonein-house.AS/RS:Automatedstorageandretrievalsystem.ThebenefitsofanAS/RSaretypically:higherpickratesperpersonandgreaterstoragedensityofproducts.Thegreaterdensityisbecauseitemsmaybestoredhigher.ATP(AvailableToPromise):Amountofproductthatafacilitycanpromisetodeliverquicklybecauseithasa)therequiredproductandcomponentsonhand,b)notpromisedalreadytosomeothercustomer,andc)hasproductioncapacitytoassembletheproduct,notalreadyscheduledforproductionofotherproductsforothercustomers.Attributessampling:Inqualityassurance,samplinginwhichayes/noattributeismeasured(e.g.,defectiveornot).Incontrast,seevariablessampling.AVI(AutomaticVehicleIdentification):Asysteminwhichparticipatingvehicles(e.g.,trucks)carryatransponderthatmaybequeriedbyareader(e.g.,ataweightscale,atollbooth,oratportofentryatastateborder).Thetransponder,ifitrecognizesthedeviceorsystemsendingthequery,willrespondwithitsidentificationcode.Thiskindofsystemisalsousedinautomobiletollcollection.Theidentificationcodecontainsinformationaboutthetypeofvehicle,suchasthenumberofaxles.Theroadwaymayhaveadditionalsensorstocountthenumberofaxlesand/orestimatethelengthofthevehicleandcheckifitmatchesthevehicledescriptioninthecodesentbythetransponder.AVL(ApprovedVendorList):ForeachSKUthatwemightbuy,alistofvendorswhohavebeenapprovedtosupplythisSKU(e.g.,onthebasisofquality,price,deliverytime).B2B:BusinesstoBusiness.Thisisatransactionbetweentwobusinesses.B2C:BusinesstoConsumer.Thisisatransactionbetweenabusinessandaconsumer.Backhaul:Areturntrip,carryinggoodsperhapsatalowerrate,aftermakingtheprimarydelivery.Seealsodeadhead.Back