Term
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Definition
| Any set of activities performed by an organization that takes inputs and transforms them into outputs ideally of greater value to the organization than the original inputs. |
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Term
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Definition
| The average time between completions of successive units in a process (this is the definition used in this book). The term is sometimes used to mean the elapsed time between starting and completing a job. |
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Term
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Definition
| The ratio of the time that a resource is actually activated relative to the time that it is available for use. |
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Term
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Definition
| A storage area between stages where the output of a stage is placed prior to being used in a downstream stage. Buffering allows the stages to operate independently. |
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Term
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Definition
| The activities in the stage must stop because there is no place to deposit the item just completed. |
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Term
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Definition
| The activities in a stage must stop because there is no work. |
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Term
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Definition
| A resource that limits the capacity or maximum output of the process. |
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Term
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Definition
| A process that is activated only in response to an actual order. |
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Term
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Definition
| A process that produces standard products that are stored in finished goods inventory. The product is delivered quickly to the customer from the finished goods inventory. |
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Term
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Definition
| Combines the features of both make-to-order and make-to-stock. Typically, a generic product is made and stocked at some point in the process. These generic units are customized in a final process to meet actual orders. |
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Term
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Definition
| Movement of items through a process is coordinated through a timing mechanism. Most processes are not paced, but assembly lines usually are paced. |
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Term
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Definition
| The ratio of output to input. Taking the dollar value of the output and dividing by the dollar value of the inputs usually measures total factor productivity. Alternatively, partial factor productivity is measured based on an individual input and often is not calculated using dollar values (an example would be units/person). |
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Term
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Definition
| A ratio of the actual output of a process relative to some standard. |
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Term
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Definition
| The time required to produce a batch of parts. |
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Term
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Definition
| The time required to prepare a machine to make a particular item. |
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Term
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Definition
| The sum of the setup time and run time for a batch of parts that are run on a machine. |
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Term
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Definition
| The average time that it takes a unit to move through an entire process. Usually the term lead time is used to refer to the total time that it takes a customer to receive an order (includes time to process the order, throughput time, and delivery time). |
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Term
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Definition
| The output rate that the process is expected to produce over a period of time. |
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Term
| Process velocity or throughput ratio |
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Definition
| The ratio of the total flow time to the value-added time. |
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Term
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Definition
| The time in which useful work is actually being done on the unit. |
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Term
| Total average value of inventory |
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Definition
| The total average investment in raw material, work-in-process, and finished goods inventory. This is valued at the cost to the firm. |
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Term
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Definition
| The cost of goods sold divided by the total average value of inventory. |
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Term
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Definition
| The number of days of inventory of an item. If an item were not replenished, this would be the numbers of days until the firm would run out of the item (on average). Also, the inverse of inventory turn expressed in days. |
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Term
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Definition
| States a mathematical relationship between throughput rate, flow time, and the amount of work-in-process inventory. Flow time is equal to work-in-process divided by the throughput rate. |
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Term
| Partial Factor productivity |
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Definition
| measured based on an individual input, labor being the most common |
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