Know thy Meaning - 5
independent
variable
A factor or phenomenon that causes or influences another associated factor or phenomenon called
a dependent variable.
For example, income is an independent variable because it causes and influences
another variable consumption. In a mathematical equation or model, the independent variable is the variable
whose value is given. In an experiment, it is the controlled condition (that is allowed to change in a systematic manner) whose effect on
the behavior of a dependent variable is
studied. Also called controlled variable, explanatory variable, or predictor variable.
manipulated
variable
An independent variable that is manipulated
to achieve a particular effect or tested to determine if it is the cause of the effect. For example,
to find out if your weight depends on the amount of calories you consume, you could lower your
caloric intake (calories is the manipulated variable)
for a period of time and see how your
weight changes in response.
qualitative
data
Definition
Data that approximates or characterizes but does
not measure the attributes, characteristics, properties, etc., of a thing or phenomenon.
Qualitative data describes whereas quantitative data defines.
quantitative
data
Definition
Data that can be quantified and verified,
and is amenable to statistical manipulation. Quantitative data defines whereas qualitative data describes.
ABC analysis
An analysis of a range of items that have different levels of significance and should be
handled or controlled differently. It is a form of Pareto analysis in which the items (such
as activities, customers, documents, inventory items, sales territories) are grouped into three
categories (A, B, and C) in order of their estimated importance. 'A' items are very
important, 'B' items are important, 'C' items are marginally important.
For example, the best customers
who yield highest revenue are given the 'A' rating, are usually serviced by the sales manager, and receive most attention. 'B' and 'C'
customers warrant progressively less attention and are serviced accordingly.
critical value
analysis
Type of ABC analysis in which a 'critical value' (based on an item's perceived or known importance) is
assigned to every item in an inventory control system.
just in time
(JIT) inventory
Pull' (demand) driven inventory system in
which materials, parts, sub-assemblies, and support items are delivered just when needed and
neither sooner nor later. Its objective is to eliminate product inventories from the supply chain. As much a managerial philosophy as
an inventory system, JIT encompasses all activities required to make a final product fromdesign engineering onwards to the last manufacturing operation. JIT systems are fundamental to time based competition and rely on waste reduction, process simplification, setup time and batch size reduction, parallel (instead of sequential) processing, and shop floor layout redesign. Under JIT management, shipments are made within rigidly enforced
'time windows' and all items must be within the specifications with very little or no inspection. It was developed and perfected by Taiichi Ohno of
Toyota Corporation during 1960s and 70s to meet
fast changing consumer demands with minimum delays. See also just on time.
material
requirements planning (MRP/MRP-I)
Computerized ordering and scheduling system for manufacturing and fabrication industries, it uses bill of materials data, inventory data, and master production schedule to project what material is required, when, and in what quantity. MRP phases orders for dependent-demand items (such as raw materials, components, parts) over a period to synchronize flow ofmaterials and in in-process inventories with production schedules. It also computes and
tracks effect of hundreds of variables such as new orders, changes in various capacities, overloaded production centers, shortages, and delays by suppliers, and feeds financial data into the accounting system. In contrast to just in time inventory (a demand-pull production system), MRP is a plan-push system,
and in contrast to advanced planning system (a forward scheduling
system) it is a backward-scheduling sytem. See also manufacturing resource planning (MRP-II).
production
schedule
Definition
The timetable for the use of resources and processes required by a business to produce goods or provide services. A typical business will modify its production
schedule in response to large customer orders, to accommodate resource changes, to reduce costs, and to increase overall production efficiency.
distribution
requirement planning (DRP-I)
Systematic process for determining which goods, in what quantity, at which location, and when are required in meeting anticipated demand. This inventory related information is then entered into a manufacturing requirements planning (MRP-I) system as gross requirements for estimating input flows and production schedules.
supply chain
management (SCM)
Management of material and information flow in a supply chain to provide the highest degree of customer satisfaction at the lowest
possible cost.
Supply chain management requires the commitment of supply chain partners to work closely to coordinate order generation, order taking, and order fulfillment. They thereby create an extended enterprise spreading far beyond the producer's location.
Efficient
Customer Response (ECR)
A supply chain management system that requires the sharing of
the retailer's sales and advertising information with the supplier which is used to generate orders shipped from the supplier based upon
projected customer demand. The goal is to reduce inventory and associated handling costs at the retailer.
fourth party logistics (4PL)
Arrangement in which a firm contracts out (outsources) its logistical operations to two or more specialist firms (the third party logistics) and hires another specialist firm (the fourth party) to coordinate the activities of the third parties.
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