 | This article needs additional citations for verification .(April 2018) |
Cumulative quantities are a concept in logistics that involves adding up required materials quantities over a defined time-window that can be drawn as a 'cumulative curve'. This concept is applied in serial production and mainly used in the automotive industry to plan, control and monitor production and delivery. [1] The concept is sometimes called 'Cumulative Production Figures Principle' (CPGP). [2]
The Concept of Cumulative Quantities (CCQ) uses the feedback mechanism of a closed loop, which can be found in industrial, engineering and electronic systems. The target requirements are summarized for each time-interval and compared with the actual values for closed-loop control. Positive cumulative deviation for a certain time-interval requires no further order, while negative deviations require a new order. To "calm" production and material flow upper and lower tolerance boundaries are defined and only if these boundaries are violated is a renewed order.
To check the entire production and material flow 'reporting limits' can be defined at a chosen counting point and if a limit is exceeded a concerned 'alert' is issued. The logistics staff has to explain the reason for the 'alert'. If the reason is correct and traceable no further action is needed. If mistakes are present in the database, data processing or in data-acquisition appropriate counter-measures are needed. Examples for mistakes or failures wrong primary demand or bad forecasting, mistakes in Bill of Material or master data, old Master Production Schedule, inaccurate or delayed data acquisition, calculation mistakes, mounting of incorrect parts at assembly line.
Target-actual-control-loop uses exactly defined counting points that demarcate the next-following intervals along the supply chain. [3] The cumulative differences of next-following counting points show the quantities of material items which traverse the Interval and therefore offer transparency of the inventory of an item along the entire supply chain.
Cumulative quantities are a part of official EDI-formats (e.g. EDIFACT - DELFOR) that are widely used by OEMs and their suppliers. Normally the data acquisition at 'goods receipt' are used for communication between consignee and goods dispatcher.
In commerce, supply chain management (SCM) deals with a system of procurement, operations management, logistics and marketing channels, through which raw materials can be developed into finished products and delivered to their end customers. A more narrow definition of supply chain management is the "design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronising supply with demand and measuring performance globally". This can include the movement and storage of raw materials, work-in-process inventory, finished goods, and end to end order fulfilment from the point of origin to the point of consumption. Interconnected, interrelated or interlinked networks, channels and node businesses combine in the provision of products and services required by end customers in a supply chain.
Logistics is the part of supply chain management that deals with the efficient forward and reverse flow of goods, services, and related information from the point of origin to the point of consumption according to the needs of customers. Logistics management is a component that holds the supply chain together. The resources managed in logistics may include tangible goods such as materials, equipment, and supplies, as well as food and other consumable items.
Material requirements planning (MRP) is a production planning, scheduling, and inventory control system used to manage manufacturing processes. Most MRP systems are software-based, but it is possible to conduct MRP by hand as well.
Inventory or stock refers to the goods and materials that a business holds for the ultimate goal of resale, production or utilisation.
A supply chain, sometimes expressed as a "supply-chain", is a complex logistics system that consists of facilities that convert raw materials into finished products and distribute them to end consumers or end customers. Meanwhile, supply chain management deals with the flow of goods within the supply chain in the most efficient manner.
Procurement is the process of locating and agreeing to terms and purchasing goods, services, or other works from an external source, often with the use of a tendering or competitive bidding process. The term may also refer to a contractual obligation to "procure", i.e. to "ensure" that something is done. When a government agency buys goods or services through this practice, it is referred to as government procurement or public procurement.
Purchasing is the procurement process a business or organization uses to acquire goods or services to accomplish its goals. Although there are several organizations that attempt to set standards in the purchasing process, processes can vary greatly between organizations.
Manufacturingresource planning is a method for the effective planning of all resources of a manufacturing company. Ideally, it addresses operational planning in units, financial planning, and has a simulation capability to answer "what-if" questions and is an extension of closed-loop MRP.
Reverse logistics encompasses all operations related to the upstream movement of products and materials. It is "the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal. Remanufacturing and refurbishing activities also may be included in the definition of reverse logistics." Growing green concerns and advancement of green supply chain management concepts and practices make it all the more relevant. The number of publications on the topic of reverse logistics have increased significantly over the past two decades. The first use of the term "reverse logistics" in a publication was by James R. Stock in a White Paper titled "Reverse Logistics," published by the Council of Logistics Management in 1992. The concept was further refined in subsequent publications by Stock (1998) in another Council of Logistics Management book, titled Development and Implementation of Reverse Logistics Programs, and by Rogers and Tibben-Lembke (1999) in a book published by the Reverse Logistics Association titled Going Backwards: Reverse Logistics Trends and Practices. The reverse logistics process includes the management and the sale of surplus as well as returned equipment and machines from the hardware leasing business. Normally, logistics deal with events that bring the product towards the customer. In the case of reverse logistics, the resource goes at least one step back in the supply chain. For instance, goods move from the customer to the distributor or to the manufacturer.
Integrated logistics support (ILS) is a technology in the system engineering to lower a product life cycle cost and decrease demand for logistics by the maintenance system optimization to ease the product support. Although originally developed for military purposes, it is also widely used in commercial customer service organisations.
Safety stock is a term used by logisticians to describe a level of extra stock that is maintained to mitigate risk of stockouts caused by uncertainties in supply and demand. Adequate safety stock levels permit business operations to proceed according to their plans. Safety stock is held when uncertainty exists in demand, supply, or manufacturing yield, and serves as an insurance against stockouts.
Military supply-chain management is a cross-functional approach to procuring, producing and delivering products and services for military materiel applications. Military supply chain management includes sub-suppliers, suppliers, internal information and funds flow.
Postponement is a business strategy employed in manufacturing and supply chain management which maximizes possible benefit and minimizes risk by delaying further investment into a product or service until the last possible moment, or where a manufacturer produces a generic product, which can be modified at a later stage before the final distribution to the customer. An example of such a strategy is Dell Computers' build-to-order online store. One of the earliest references to the concept was in a paper by Walter Zinn and Donald J. Bowersox in the Journal of Business Logistics in 1988, which highlighted five types: labelling, packaging, assembly, manufacturing and time postponements.
Materials management is a core supply chain function and includes supply chain planning and supply chain execution capabilities. Specifically, materials management is the capability firms use to plan total material requirements. The material requirements are communicated to procurement and other functions for sourcing. Materials management is also responsible for determining the amount of material to be deployed at each stocking location across the supply chain, establishing material replenishment plans, determining inventory levels to hold for each type of inventory, and communicating information regarding material needs throughout the extended supply chain.
Although logistics has been mostly utilized in commercial supply chains, it is also an important tool in disaster relief operations. Humanitarian logistics is a branch of logistics which specializes in organizing the delivery and warehousing of supplies during natural disasters or complex emergencies to the affected area and people. However, this definition focuses only on the physical flow of goods to final destinations, and in reality, humanitarian logistics is far more complicated and includes forecasting and optimizing resources, managing inventory, and exchanging information. Thus, a good broader definition of humanitarian logistics is the process of planning, implementing and controlling the efficient, cost-effective flow and storage of goods and materials, as well as related information, from the point of origin to the point of consumption for the purpose of alleviating the suffering of vulnerable people.
Supply chain risk management (SCRM) is "the implementation of strategies to manage both everyday and exceptional risks along the supply chain based on continuous risk assessment with the objective of reducing vulnerability and ensuring continuity".
Third-party logistics is an organization's long term commitment of outsourcing its distribution services to third-party logistics businesses.
Management accounting in supply chains is part of the supply chain management concept. This necessitates planning, monitoring, management and information about logistics and manufacturing processes throughout the value chain. The goal of management accounting in supply chains is to optimise these processes. This strategy focuses on supporting management.
SAP EWM is part of SAP AG's Supply Chain Management Suite of solutions. The Extended Warehouse Management product is an integrated software platform for inflexible, automated support for processing goods movements and for managing inventory in the warehouse.
In logistics, a counting point is a certain spot designated for planning, controlling, and monitoring material flow items.