Definition of Terms

Know the definitions of the terms you'll encounter when reviewing the SCPLTM learning materials.

Advisory Services

Third party services defined by a scope of work to advise a project over a set period of time. Typically, supply chain performance and optimization Advisory Services accelerate team strategic business initiatives to develop, launch and improve products and supply chains via technology.

Agile

A nonlinear project management methodology where projects are broken down into short repeatable periods of time, typically one to four week sprints. Sprints should result in a draft, prototype and/or workable version of the final project deliverable

Agile Lean FrameworkTM

A “Crawl-Walk-Run”, four-level approach to help frame a company's digital transformation journey that builds Agile, Lean and Industry 4.0 capabilities over time and realizes sustainable supply chain performance results more quickly.

Agile Lean Process

A repeatable eight-step process to accelerate continuous improvement initiatives. The process is intended to be used to quickly root out the causes of supply performance challenges and to develop a path forward to optimize and sustain desired business outcomes.

Agile Lean Productivity Framework

A four-step productivity framework to accelerate desired business outcomes with automation.

Agile Lean Supply Chain

A supply chain strategy that uses Lean principles, Agile approaches and Industry 4.0 technologies to enhance supply performance and enable a supply chain competitive advantage.

Application Programming Interface (API)

A software intermediary that allows two software applications to push and pull data between each other.

Artificial Intelligence (AI)

A wide branch of computer science that encompasses software and machines containing software that can perform tasks that typically require human intelligence. AI software is programmed to think like humans, performing operations like learning and problem-solving, and covers multiple approaches from machine learning to deep learning.

Automated Plan for Every PartTM (AutoPFEP)

A Lean software tool for mapping, optimizing, and managing input data required to maintain a high performing supply chain. Typically, the tool is a standalone system and/or a feature within a Supply Performance SystemTM that allows teams to realize results more quickly via productivity gains from system collaboration and automation.

Business Ecosystem

The network of stakeholders – e.g., companies, suppliers, distributors, customers, competitors, government agencies, etc. — involved in the delivery of a specific product or service through both competition and cooperation.

Business Outcome Services

Third party services defined by future state outcomes to support and/or execute project tasks to realize results faster.

Capabilities

A tactic for categorizing parts to enable deeper insights and analysis. The term capability is preferred over the commonly used term “commodity,” to foster more goodwill in supplier conversations.

Cloud Software

The delivery of computing services, including servers, storage, databases, networking, software, analytics, and intelligence over the Internet, the “cloud”, to offer faster innovation, flexible resources and economies of scale.

Co-Create

The collaborative development of new value (concepts, solutions, products, and services) together with stakeholders, like customers and/or suppliers.

Cost Avoidances

The avoidance of planned future state costs over a period of time.

Cost Savings

The delta of realized future state costs from current state costs over a period of time.

Current State

The present state of a company, division, plant, process, product, project, part, etc.

Data Lake

A system or repository of data stored in its natural/raw format, typically structured data within a system database and/or unstructured data stored in a cloud storage system.

Deployment Services

Third party services to map current to future data/systems, digitize data, connect systems, deploy software, and train a given team.

eKanban

A self-managing, real-time electronic system that can be utilized internally and/or extended externally to sustain best practices, commonly used for inventory management, planning, scheduling and two-way Buyer-Supplier communication for Lean and just-in-time manufacturing (JIT).

Executive Summary Report

A concise summary of analysis appropriate for senior-level leaders that’s typically used when requesting initiative/project budget approval, and/or delivering results or a status update on an initiative/project.

Flows

Encompass all current state value chain information and physical (part, packaging, product, and people) flows.

Future State

The final desired business outcome(s) that an initiative or project aims to obtain that are different than those in the current state.

Industry 4.0

The fourth industrial revolution underway that's blurring the lines between the physical, digital and biological spheres.

Information Flows

The movement of information between people, hardware, systems and/or companies.

Kanban

A scheduling management system deployed by Toyota for Lean and just-in-time manufacturing (JIT).

Kanban Card

A physical representation of inventory in a paper card form as part of Lean Kanban inventory management system. A Kanban card is removed from inventory once consumption starts to signal a standard unit needs to be reordered.

Lean Extended Enterprise

An expanded definition of the enterprise to include all organizations along the value chain that create value outside of your organization, and that are required to sell your product to customers. The concept that a company doesn’t operate in isolation because its success is dependent upon a network of suppliers and partners, e.g., tier Is, IIs, and IIIs.

Level Scheduling

The alignment of production output with customer requirements to enable a smooth flow of inbound parts and outbound product over a period of time.

Linear Process

A process where repetitive tasks progress and change straight from one stage to another, and that has a starting point and an ending point. Process examples include procure to pay, inbound parts receipt, material delivery routes, and Kanban systems.

Machine Learning (ML)

The application of software algorithms that can automatically learn from data, identify patterns, and make decisions with minimal human intervention, and a branch of AI.

Managed Services

Third party services to proactively identify, support and/or execute and deliver ongoing business outcome results.

Non-Linear Process

A process where tasks progress and change and there isn’t a straight line or direct relationship from one stage to another, and progress is determined by task statuses ranging from open to closed. Process examples include new product development, new product launch, and continuous improvement.

Off-Premise Software

Purchased software access that is hosted by a third-party Supplier and/or their Suppliers. Typically, off-premise software is Software as a Service (SaaS), hosted Buyer software licenses and data in a cloud software environment accessible via internet connection.

On-Demand Services

Services provided on an as needed basis to address defined needs. Typically, “X” as a Service – e.g., Supply Chain as a Service – is technology-enabled managed services and provide mix of fixed and variable cost support to lower overall costs while enhancing business outcomes.

On-Premise Software

Purchased software from a third-party Supplier, and/or developed by Buyer and/or Buyers’ Suppliers. Typically, on-premise software is legacy purchased software and inputted data, stored onsite at Buyer location(s) accessible via Buyer intranet.

PACE MethodTM

A four-step method to assess and systematically optimize new product launches.

Payback Period

The period of time that a potential initiative and/or project will “break even”, e.g., save and/or avoid the amount of money equal to the initial monetary investment for the initiative and/or project investment. Payback Period is also referred to as Breakeven Point.

Payback Period Analysis

The analysis of a potential investment and cost savings/avoidances for an initiative and/or project that calculates the Payback Period where the investment is recuperated by the cost savings/avoidances. Payback Period Analysis is also referred to as Breakeven Analysis.

Pilot Project

A small-scale, focused project over a short duration of time that’s intended to realize quick-win, low-risk results for both the Buyer and Supplier(s). The intent of a Pilot Project is often to prove out a new technology and/or product. Pilot Project is also referred to as Proof of Concept.

Physical Flows

The movement of tangible assets such as people, parts, and material handling equipment, within and outside of companies.

Phased Deployment Plan

A low risk software deployment plan that focuses on realizing and then building success in waves by site, capabilities and/or users.

Plan For Every Part (PFEP)

An essential Lean Tool for mapping, optimizing and managing input data to maintain high-performing supply chain.

Predictive Analytics

The application of software algorithms into software analytics tools that can automatically make predictions with minimal human intervention.

Project Charter

A one page tool to clearly define a problem and the project team, scope, and goals that will enable results more quickly. Typically, a Project Charter includes a project title, current and future state key performance indicators, problem statement, current and future state metrics, goal statement, project in scope and out of scope, project lead, project team members and project executive sponsor, key stakeholders, and potential risks. The Project Charter is created ahead of budget approval request or shortly after budget approval ahead of product kickoff.

Point

A metric used in Agile project management to estimate the difficulty of completing a given task, which is an abstract measure of effort required to complete it.

Pull Systems

A Lean manufacturing strategy and supporting tactics and tools used to reduce waste in the production process, where parts used in the manufacturing process are only replaced once they’ve been consumed so companies only make enough products to meet customer demand.

Return on Investment (ROI)

The result of an initiative or project above and beyond the investment over a period of time. The form of result is typically cost savings and cost avoidances but could also include increased revenue, and/or non-financial metrics such as improved on-time delivery.

RASIC Chart

A project management tool that outlines who is (R)esponsible, (A)pproving, (S)upporting, (I)nformed and (C)onsulted for each workstream, task and/or process on a project.

Site Assessment

The in-depth onsite review of current state operations at a specific site like at a manufacturing plant, warehouse, or other facility. The intent of this in-depth review is to verify anticipated business outcomes to realize results more quickly.

Software as a Service (SaaS)

A software business model in which software is licensed on a subscription basis and hosted centrally, allowing users to connect to and use cloud-based applications over the internet.

Software Deployment

The process to onboard, roll out, connect, configure and/or train users of a system over a period of time to meet business outcome goals.

Spend Analysis

A focused analysis of a company, product, or segment of spend. Typically, the analysis highlights, spend by segment, supplier, capabilities, region, country, concentrations, supply risks, macro trends, and recommendations for optimization, including cost, time-risk reductions through resourcing, and/or sourcing.

Sprints

Short repeatable time periods, typically one to four weeks, that contain several points or tasks required to complete a draft, prototype and/or workable version of the final project deliverable as part of an Agile project.

Supplier Data Management Process

A four-step process for acquiring and maintaining supplier data that enables multiple channels to optimize supply cost, time, and risk.

Supplier Information FrameworkTM

A five-level framework to outline and align both supplier data and assessment levels to streamline processes and communication.

Supplier Set

An essential tool for mapping, optimizing, and managing supplier data to enable a high-performing supply chain. The traditional definition of a Supplier Set can go by alternative terms such as Commodity Strategies, Buying Decks and Supplier Lists.

Supply Chain as a ServiceTM (SCaaS)

An on-demand, “technology enabled managed service,” combining experienced professionals with cloud-based productivity software to support all or part of a company’s supply chain.

Supply Chain Assessment

The in-depth review of current state supply chain operations for a specific company, division and/or product with the intent to verify anticipated business outcomes to realize supply chain optimization results more quickly.

Supply Chain Digitization

The movement toward a completely integrated sequence of planning and production solutions that work in tandem to create a more visible supply stream across each touch point of the value chain.

Supply Chain Optimization Analysis

The in-depth analysis of current state and potential future supply chain operations for a specific company, division, plant, process, and/or product. The analysis typically includes potential solutions, potential solution alternatives, investments required to realize future state cost savings and/or avoidances, ROI and payback period.

Supply Performance FrameworkTM

A repeatable seven-step framework to help a company optimize and maintain supply performance more quickly.

Supply Performance SystemTM (SPS)

Is a purpose-built, day-to-day collaboration and execution software tool that empowers teams to drive supply chain performance results. Sometimes referred to as Supply Execution Systems (SES), and/or Supply Chain Execution Systems (SCES), these systems are similar to Manufacturing Execution Systems (MES), except focused on increasing team collaboration and daily productivity of supply chain execution.

Technology Enables Services

A business model that combines experienced professionals with software to support company tasks, projects, processes, and/or functions.

Value Stream Map

A Lean tool to visually outline detailed information and physical (part, packaging, product, and people) flows. Typically, the idea is to create a current state map and future state map to highlight optimizations to improve value creation by reducing waste.

Waterfall

A linear project management methodology where projects are broken down into sequential terminal phases. The next phase of a project begins only when a prior phase is completed.

Waves

A focused scope of work to be completed over a time period as part of a Phased Deployment Plan to accelerate quick-win, low-risk results, focusing on specific sites, capabilities and/or user groups.