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Estimating the quality of conformance of large batches through inspection of smaller samples.
acceptance sampling
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Medium-term tactical capacity planning in response to changing demand.
aggregate planning
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Japanese term for a signaling system announcing problems encountered and assistance requested, often implemented as sets of lights over workstations.
andon
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Estimate of the proportion of defects that pass an acceptance sampling plan.
average outgoing quality (AOQ)
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Determining the overall inventory requirements of a finished good by combining information on amount of the good produced with the requirements information in its bill of materials.
backflushing
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Measuring performance relative to some peer’s performance, generally identified as ‘best in class’.
benchmarking
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A description of all raw materials and intermediate assemblies required to create a finished product.
bill of materials
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A group problem-solving technique that requires collection and discussion of various ideas from group members in an effort to develop a solution to a target problem.
brainstorming
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Aggregate planning approach that relies on changing capacity to match demand.
chase demand strategy
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The likelihood of a Type II error.
consumer's risk
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Graph illustrating observed values in relationship to the allowable limits on those values.
control chart
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Time remaining until due date divided by work remaining to be done.
critical ratio
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Requirements for child items, also known as ‘component demand.’
dependent demand
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Translation of an aggregated value into smaller individual estimates corresponding to specific products.
disaggregation
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Assigning work in real-time, often in the context of mobile resources.
dispatching
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Granting an employee the authority to take independent action on behalf of the overall operation.
employee empowerment
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A scheduling approach which recognizes capacity constraints.
finite loading
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Visual model to clarify cause-and-effect relationships.
fishbone diagram
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The length of time a job spends in the system.
flowtime
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In planning, a policy that does not allow changes to the Master Production Schedule within a protected interval.
freezing
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The combined, overall demand for an item.
gross requirements
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A bar chart illustrating the relative frequency of occurrences in different categories.
histogram
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Requirements for an item from outside the system, also known as ‘customer demand.’
independent demand
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A scheduling approach which ignores capacity constraints.
infinite loading
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A certification of compliance with an internationally recognized set of quality management standards.
ISO 9000
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The authority to stop production.
jidoka
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A phrase first popularized by the Bose Company, emphasizing vendor managed inventory and co-location of those vendors within a production facility.
JIT II
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An earlier and alternate term for lean operation, in which a system implicitly operates with minimum of inventory and waste.
Just-in-Time (JIT)
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Japanese term for a focus on continuous improvement.
kaizen
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Assigning work to resources.
loading
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Maximum proportion of defects that a consumer can tolerate.
lot tolerance percent defective (LTPD)
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An ordering policy in which orders are sized to match individual demands exactly, theoretically accumulating no inventory.
lot-for-lot (LFL)
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A statement of independent demand for all inventory items in an MRP system.
master production schedule (MP)
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A technique for scheduling the production of multiple items related by both independent and dependent demand.
material requirements planning (MRP)
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The lowest speed of perfectly level production that will not produce any shortages within a demand forecast.
minimum constant production (MCP) rate
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Production of a range of products with a single assembly line, primarily by varying features on an otherwise standardized product.
mixed model assembly
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Japanese term for waste, particularly anything a customer is not willing to pay for.
muda
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A point of time within a forecast where aggregate demand dictates the minimum level production rate necessary to fulfill all demand specified by that forecast.
natural planning horizon
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A graph of the likelihood of accepting a batch, given increasing proportion of defects within that batch.
operating characteristic (OC) curve
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A schedule of the ordering of a particular item within a planning horizon, to supply its gross requirements over that same time interval.
planned order releases
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Japanese term for process improvements striving to make the desired outcome of a process inevitable, largely by preventing mistakes.
poka-yoke
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The natural variation in an existing process, stated relative to the allowable variation specified in a product’s design.
process capability
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The likelihood of a Type I error.
producer's risk
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A particularly visual format for a bill of materials, in which parent/child relationships among inventory items have been illustrated as a network of connected shapes.
product structure diagram
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A production system that reacts to signals of demand, relying on internal coordination instead of the implementation of explicit plans to achieve outcomes.
pull systems
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A production system that calculates and anticipates demand, relying on the implementation of explicit plans instead of internal coordination to achieve outcomes
push systems
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A group of employees that meets regularly to discuss and develop opportunities for continuous improvement of their operation.
quality circle
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The degree to which the output of an operation meets the producer’s expectations.
quality of conformance
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The degree to which the output of an operation meets the customer’s expectations.
quality of design
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To determine the order in which requirements are met.
sequencing
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An individual or organization’s comprehension of the surrounding environment and its potential near future states.
situational awareness
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A quality management program emphasizing the application of analytical tools and wide-spread involvement of employees across the organization.
six sigma
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The monitoring of overall conformance through the on-going evaluation of samples.
statistical process control (SPC)
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A proposed model of the cost of non-conformance that penalizes even small degrees of deviation from a target specification.
Taguchi loss function
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A body of knowledge focused on managing the limitations on a system for continuous improvement.
Theory of Constraints (TOC)
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The smallest interval of time used in planning, such as hourly, daily or weekly.
time bucket
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A point in time specified by a policy to protect a master production schedule from near-term changes, dividing the planning horizon into shorter intervals with varying levels of protection.
time fence
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Simultaneous and continuous pursuit of improvement in both the quality of design and conformance through the involvement of the entire organization.
total quality management (TQM)
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In quality control, concluding the process is out of control when in fact it is not
Type 1 error
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In quality control, concluding the process is in control when in fact it is not.
Type II error
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