Industry Terminology

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




Magnetic Stripe: Layer of ferromagnetic material bonded to a non-magnetic carrier, usually plastic, as in credit cards, to store information electronically. Often referred to as mag stripe.


Make-to-Order: A supplier's approach to plant production in which a product is made after receipt of a retailer's order. It often involves custom design to meet customer needs. See Assemble-to-Order and Make-to-Stock.


Make-to-Stock: An approach to production in which a supplier guesses at demand and makes products in advance accordingly. Also called make-to-forecast. Often, customer orders are shipped from existing stocks, and production replenishes those stocks as needed. See Assemble-to-Order, Make-to-Order.


Manufacture Cycle Time: The average time between commencement and completion of a manufacturing process, as it applies to make-to-stock products. Calculation: [Average # of units in WIP] / [Average daily output in units]


Manufacturing Capital Asset Value: The asset value of the "Manufacturing fixed assets" after allowance for depreciation. Examples of equipment are SMT placement machines, conveyors, Auto guided vehicles, robot cells, testers, X-ray solder machines, Burn-in chambers, Logic testers, Auto packing equipment, PLC station controllers, Scanning equipment, PWB magazines.


Manufacturing Execution System: A factory floor information and communication system enabling resource allocation, detailed scheduling, document control, data collection and acquisition, labor management, quality management, process management, maintenance management, order tracking, WIP status, and performance analysis. Manufacturing Requirements Planning (MRP I): A supplier's system for planning all production and procurement resources, but not labor, distribution, etc. See manufacturing resource planning (MRP II).


Manufacturing Lead Time: The total time required to manufacture an item, exclusive of lower level purchasing lead time. For make-to-order products, it is the length of time between the release of an order to the production process and shipment to the final customer. For make-to stock products, it is the length of time between the release of an order to the production process and receipt into finished goods inventory. Included here are order preparation time, queue time, setup time, run time, move time, inspection time, and put-away time. Synonyms: Manufacturing Cycle Time. Also see: Lead Time


Manufacturing Resource Planning (MRP II): A method for the effective planning of all resources of a manufacturing company. Ideally, it addresses operational planning in units, financial planning in dollars, and has a simulation capability to answer what- if questions. It is made up of a variety of processes, each linked together: business planning, production planning (sales and operations planning), master production scheduling, material requirements planning, capacity requirements planning, and the execution support systems for capacity and material. Output from these systems is integrated with financial reports such as the business plan, purchase commitment report, shipping budget, and inventory projections in dollars. Manufacturing resource planning is a direct outgrowth and extension of closed-loop MRP.


Mapping: A computer term referring to diagramming data that is to be exchanged electronically, including how it is to be used and what business management systems need it. Preliminary step for developing an applications link. Performed by the functional manager responsible for a business management system.


Mapping Software: See EDI Mapping Software.


Marginal Cost: The cost to produce one additional unit of output. The change in total variable cost resulting from a one-unit change in output.


Markdown Plan: Planned reductions (or, in some cases, increases) in the selling price of an article within a particular period. A markdown plan can also contain the planned sales quantities and volumes.


Market Basket Analysis: Studying what items consumers often purchase together to improve cross promotion, in-store layouts and displays, and promotional strategies.


Market Demand: In marketing, the total demand that would exist within a defined customer group in a given geographical area during a particular time period given a known marketing program.


Mass Customization: A highly streamlined and flexible approach to production that enables quick and efficient production of customized products and/or services at low cost and high volume.


Master Pack: Carton received that contains more than one warehouse pack or shipping unit inside it. This is very common in certain orders, such as imports.


Master Production Schedule (MPS): The schedule that determines which products a manufacturer produces in which volumes at which dates.


MAT: Merchandising-Advertising Technology. Systems that produce catalogs, supplements, ROP ads, in-store signage, etc.


Material Acquisition Costs: One of the elements comprising a company's total supply-chain management costs. These costs consist of the following: 1. Materials (Commodity) Management and Planning: All costs associated with supplier sourcing, contract negotiation and qualification, and the preparation, placement, and tracking of a purchase order. We recognize that these functions may be organizationally dispersed and/or decentralized, but ask you to group all related costs for purposes of this study. Also, this category includes all costs related to buyer/planners. 2. Supplier Quality Engineering: The costs associated with the determination, development/certification, and monitoring of suppliers' capabilities to fully satisfy the applicable quality and regulatory requirements. 3. Inbound Freight and Duties: Freight costs associated with the movement of material from a vendor to the buyer and the associated administrative tasks. Duties are those fees and taxes levied by government for moving purchased material across international borders. Customs broker fees should also be considered in this category. 4. Receiving and Material Storage: All costs associated with taking possession of material. This does not include inspection. Note that inventory-carrying costs are covered in a subsequent worksheet. 5. Incoming Inspection: All costs associated with the inspection and testing of received materials to verify compliance with specifications. 6. Material Process and Component Engineering: Those tasks required to document and communicate component specifications, as well as reviews to improve the manufacturability of the purchased item. 7. Tooling: Those costs associated with the design, development, and depreciation of the tooling required to produce a purchased item. A tooling cost would be incurred by a company if they actually paid for equipment and/or maintenance for a contract manufacturer that makes their product. Sometimes, there aren't enough incentive for a contract manufacturer to upgrade plant equipment to a level of quality that a company requires, so the company will pay for the upgrades and maintenance to ensure high quality. May not be common in some industries such as the Chemicals


Material Safety Data Sheet (MSDS): A document that is part of the materials information system and accompanies the product. Prepared by the manufacturer, the MSDS provides information regarding the safety and chemical properties and (if necessary) the long-term storage, handling, and disposal of the product. Among other factors, the MSDS describes the hazardous components of a product; how to treat leaks, spills, and fires; and how to treat improper human contact with the product. Also see: Hazardous Materials


Materials Handling: The physical handling of products and materials between procurement and shipping.


Materials Management: Inbound logistics from suppliers through the production process. The movement and management of materials and products from procurement through production.


Materials Requirements Planning (MRP): A decision-making methodology used to determine the timing and quantities of materials to purchase.


Matrix Organizational Structure: An organizational structure in which two (or more) channels of command, budget responsibility, and performance measurement exist simultaneously. For example, both product and functional forms of organization could be implemented simultaneously, that is, the product and functional managers have equal authority and employees report to both managers.


MAU: Multi-station Access Unit: A connection in a token ring LAN.


MaxiCode: A 2-dimensional bar-code symbology that encodes large volumes of data. It is a standard for fast auto-sortation, and was developed by UPS.


Maximum Inventory: The planned maximum allowable inventory for an item based on its planned lot size and target safety stock.


Maximum Order Quantity: An order quantity modifier, applied after the lot size has been calculated, that limits the order quantity to a preestablished maximum.


MBO: Management Buy Out. John Harvey led an MBO of TBG from Unilever/VGL in 1984!


Mean: The arithmetic average of a group of values. Syn: arithmetic mean.


Median: The middle value in a set of measured values when the items are arranged in order of magnitude. If there is no single middle value, the median is the mean of the two middle values.


MES: See Manufacturing Execution System.


Message: The EDIFACT term for a transaction set. A message is the collection of data, organized in segments, exchanged by trading partners engaged in EDI. Typically, a message is an electronic version of a document associated with a common business transaction, such as a purchase order or shipping notice. A message begins with a message header segment, which identifies the start of the message (e.g., the series of characters representing one purchase order). The message header segment also carries the message type code, which identifies the business transaction type. EDIFACT's message header segment is called UNH; in ANSI X12 protocol, the message header is called ST. A message ends with a message trailer segment, which signals the end of the message (e.g., the end of one purchase order). EDIFACT's message trailer is labeled UNT; the ANSI X12 message trailer is referred to as SE.


Metadata: Information about the data in a database or data warehouse: what it is, where it is, where it came from, its original format, how it was collected, how it was cleansed, etc.


MHE: Mechanical Handling Equipment (see also FLT, HPT, PPT, HLOP, etc.)


Microfilm: The process of filming documents. Copies of the documents may be retrieved if needed.


Micro-Marketing: Customizing each store's assortments, SKU quantities, promotions, and/ or introductions to fit each store's local pattern of demand.


Micro-Merchandising: A subset of micro-marketing focused on customizing assortments, quantities, and displays for each store.


Milk run: A regular route for pickup of mixed loads from several suppliers. For example, instead of each of five suppliers sending a truckload per week to meet the weekly needs of the customer, one truck visits each of the suppliers on a daily basis before delivering to the customer's plant. Five truckloads per week are still shipped, but each truckload contains the daily requirement from each supplier. Also see: Consolidation


Min-Max System: A simple replenishment system in which inventory level falling to the "min" (minimum) triggers an order of whatever quantity will reach the "max" (maximum) level.


MIS: Management information systems. The department or group of people focused on a company's information systems. See IS.


Mixed Case: A case that contains multiple SKUs. Mixed Pallet: A pallet that contains cases of different SKUs.


MOA: Memorandum Of Agreement


Mobile: as in "M-Commerce" (electronic shopping on the move).


Mode Quantity: Modulator-Demodulator. An optional two-way communication device which changes the form, bi-directionally, of data transmission signals.


Modem: Modulator-Demodulator. An optional two-way communication device which changes the form, bi-directionally, of data transmission signals. The modem can be either a direct-connect (hardwired into the telephone system) or acoustic (using a telephone handset) system.


Moving Beam Bar Code Reader: Scanner in which the motion is achieved by mechanically moving the optics.


mpg: miles per gallon


mph: miles per hour


MPS: Master Production Scheduling


MPT: Manpower, Personnel and Training


MPV: Multipurpose Vehicle


MR: Materials Replenishment


MRO: Maintenance, repair, and operating supplies. A category of inventory including office supplies and diverse other items not part of the critical products on which a purchasing department typically focuses.


MRP: Manufacturing Requirements Planning (AKA"Manufacturing Resource Planning"): production-led planning technique seen as precursor to JIT. Now revived as MRP II. See also DRP.


MRP II: See Manufacturing Resources Planning.


MSDS: See Material Safety Data Sheet


MU Merchandisable Unit: usually a dolly or wheeled carrier that is loaded with pre-merchandised product straight off the production line, but which travels right through the supply chain to the store sales area.


Multi-Dimensional Database: Database cross-referenced by more than tabular rows and columns. Many data warehouses are being constructed using multi-dimensional databases.


Mux or Multiplexer: Device that supports multiple polling data collection (as for getting POs and payroll data from each store) using scheduling schemes.

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