Terminology 

C-TPAT - See Customs-Trade Partnership against Terrorism



Cabotage - A federal law that requires coastal and inter-coastal traffic to be carried in U.S.-built and registered ships.



CAE - See Computer Aided Engineering



Cage - (1) A secure enclosed area for storing highly valuable items, (2) a pallet-sized platform with sides that can be secured to the tines of a forklift and in which a person may ride to inventory items stored will above the warehouse floor.



Caged - Referring to the practice of placing high-value or sensitive products in a fenced off area within a warehouse.



Calculation - To convert from working days to calendar days if work week = 4 days, multiply by 1.75 = 5 days, multiply by 1.4 = 6 days, multiply by 1.17



Call Center - A facility housing personnel who respond to customer phone queries. These personnel may provide customer service or technical support. Call center services may be in-house or outsourced. Synonym Customer Interaction Center.



Can-order Point - An ordering system used when multiple items are ordered from one vendor. The can-order point is a point higher than the original order point. When any one of the items triggers an order by reaching the must-order point, all items below their can-order point are also ordered. The can-order point is set by considering the additional holding cost that would be incurred should the item be ordered early.



Capability maturity model (CMM) - A framework that describes the key elements of an effective software process. It's an evolutionary improvement path from an immature process to a mature, disciplined process. The CMM covers practices for planning, engineering and managing software development and maintenance. When followed, these key practices improve the ability of organizations to meet goals for cost, schedule, functionality and product quality.



Capable to Promise (CTP) - A technique used to determine if product can be assembled and shipped by a specific date. Component availability throughout the supply chain, as well as available materials, is checked to determine if delivery of a particular product can be made. The process of committing orders against available capacity as well as inventory. This process may involve multiple manufacturing or distribution sites. Capable-to-promise is used to determine when a new or unscheduled customer order can be delivered. Capable-to-promise employs a finite-scheduling model of the manufacturing system to determine when an item can be delivered. It includes any constraints that might restrict the production, such as availability of resources, lead times for raw materials or purchased parts, and requirements for lower-level components or subassemblies. The resulting delivery date takes into consideration production capacity, the current manufacturing environment, and future order commitments. The objective is to reduce the time spent by production planners in expediting orders and adjusting plans because of inaccurate delivery-date promises.



Capacity - The physical facilities, personnel and process available to meet the product or service needs of customers. Capacity generally refers to the maximum output or producing ability of a machine, a person, a process, a factory, a product, or a service. Also see Capacity Management



Capacity Management - The concept that capacity should be understood, defined, and measured for each level in the organization to include market segments, products, processes, activities, and resources. In each of these applications, capacity is defined in a hierarchy of idle, non-productive, and productive views.



Capacity Planning - Assuring that needed resources (e.g., manufacturing capacity, distribution center capacity, transportation vehicles, etc.) will be available at the right time and place to meet logistics and supply chain needs.



CAPEX - A term used to describe the monetary requirements (CAPital EXPenditure) of an initial investment in new machines or equipment.



Capital - The resources, or money, available for investing in assets that produce output.



Car supply charge - A railroad charge for a shipper's exclusive use of special equipment.



Cargo - A product shipped in an aircraft, railroad car, ship, barge, or truck.



Carload Lot - A shipment that qualifies for a reduced freight rate because it is greater than a specified minimum weight. Since carload rates usually include minimum rates per unit of volume, the higher LCL (less than carload) rate may be less expensive for a heavy but relatively small shipment.



Carmack Amendment - An Interstate Commerce Act amendment that delineates the liability of common carriers and the bill of lading provision.



Carousel - Carousels are a technology used to store items for eventual picking or retrieval. There are two primary types of carousels and one related technology, all of which operate under some form of computer control. Since the late 1990s, carousels have been placed under the more general category of AS/RS.



Carrier - A firm which transports goods or people via land, sea or air.



Cartel - A group of companies that agree to cooperate, rather than compete, in producing a product or service, thus limiting or regulating competition.



Case Code - The UPC number for a case of product. The UPC case code is different from the UPC item code. This is sometimes referred to as the "Shipping Container Symbol" or ITF-14 code.



Cash Conversion Cycle - 1) In retailing, the length of time between the sale of products and the cash payments for a company's resources. 2) In manufacturing, the length of time from the purchase of raw materials to the collection of accounts receivable from customers for the sale of products or services. Also see Cash-to-Cash Cycle Time



Cash-to-Cash Cycle Time - The time it takes for cash to flow back into a company after it has been spent for raw materials. Synonym Cash Conversion Cycle. Calculation Total Inventory Days of Supply + Days of Sales Outstanding - Average Payment Period for Material in days



Catalog Channel - A call center or order processing facility that receives orders directly from the customer based on defined catalog offerings and ships directly to the customer.



Categorical Plan - A method of selecting and evaluating suppliers that considers input from many departments and functions within the buyer's organization and systematically categorizes that input. Engineering, production, quality assurance, and other functional areas evaluate all suppliers for critical factors within their scope of responsibility. For example, engineering would develop a category evaluating suppliers' design flexibility. Rankings are developed across categories, and performance ratings are obtained and supplier selections are made. Also see Weighted-Point Plan



Category Management - The management of product categories as strategic business units. The practice empowers a category manager with full responsibility for the assortment decisions, inventory levels, shelf-space allocation, promotions and buying. With this authority and responsibility, the category manager is able to judge more accurately the consumer buying patterns, product sales and market trends of that category.



Causal Forecast - In forecasting, a type of forecasting that uses cause-and-effect associations to predict and explain relationships between the independent and dependent variables. An example of a causal model is an econometric model used to explain the demand for housing starts based on consumer base, interest rates, personal incomes, and land availability.



Cause and Effect Diagram - In quality management, a structured process used to organize ideas into logical groupings. Used in brainstorming and problem solving exercises. Also known as Ishikawa or fish bone diagram.



CBT - See Computer-Based Training.



Cell - A manufacturing or service unit consisting of a number of workstations, and the materials transport mechanisms and storage buffers that interconnect them.



Cellular manufacturing - A manufacturing approach in which equipment and workstations are arranged to facilitate small-lot, continuous-flow production. In a manufacturing "cell," all operations necessary to produce a component or subassembly are performed in close proximity, thus allowing for quick feedback between operators when quality problems and other issues arise. Workers in a manufacturing cell typically are cross-trained and, therefore, able to perform multiple tasks as needed.



Center-of-Gravity Approach - A supply chain planning methodology for locating distribution centers at approximately the location representing the minimum transportation costs between the plants, the distribution centers, and the markets.



Centralized authority - Management authority to make decisions is restricted to few managers.



Centralized Dispatching - The organization of the dispatching function into one central location. This structure often involves the use of data collection devices for communication between the centralized dispatching function, which usually reports to the production control department, and the shop manufacturing departments.



Centralized Inventory Control - Inventory decision making (for all SKUs) exercised from one office or department for an entire company.



Certificate of Analysis (COA) - A certification of conformance to quality standards or specifications for products or materials. It may include a list or reference of analysis results and process information. It is often required for transfer of the custody/ownership/title of materials.



Certificate of Compliance - A supplier's certification that the supplies or services in question meet specified-requirements.



Certificate of origin - An international business document that certifies the country of origin of the shipment.



Certificate of public convenience and necessity - The grant of operating authority that is given to common carriers. A carrier must prove that a public need exists and that the carrier is fit, willing, and able to provide the needed service. The certificate may specify the commodities to be hauled, the area to be served, and the routes to be used.



Certificated carrier - A for-hire air carrier that is subject to economic regulation and requires an operating certification to provide service.



Certified Supplier - A status awarded to a supplier who consistently meets predetermined quality, cost, delivery, financial, and count objectives. Incoming inspection may not be required.



CFD - See Continuous Flow Distribution



CGMP - See Current Good Manufacturing Practice.



Chain of Customers - The sequence of customers who in turn consume the output of each other, forming a chain. For example, individuals are customers of a department store, which in turn is the customer of a producer, who is the customer of a material supplier.



Chain reaction - A chain of events described by W. Edwards Deming improve quality, decrease costs, improve productivity, increase market with better quality and lower price, stay in business, provide jobs and provide more jobs.



Challenge and Response - A method of user authentication. The user enters an ID and password and, in return, is issued a challenge by the system. The system compares the user's response to the challenge to a computed response. If the responses match, the user is allowed access to the system. The system issues a different challenge each time. In effect, it requires a new password for each logon.



Champion - A business leader or senior manager who ensures that resources are available for training and projects, and who is involved in project tollgate reviews



Change agent - An individual from within or outside an organization who facilitates change within the organization. May or may not be the initiator of the change effort.



Change Management - The business process that coordinates and monitors all changes to the business processes and applications operated by the business as well as to their internal equipment, resources, operating systems, and procedures. The change management discipline is carried out in a way that minimizes the risk of problems that will affect the operating environment and service delivery to the users.



Change Order - A formal notification that a purchase order or shop order must be modified in some way. This change can result from a revised quantity, date, or specification by the customer



Changeover - Process of making necessary adjustments to change or switchover the type of products produced on a manufacturing line. Changeovers usually lead to downtime and for the most part companies try to minimize changeover time to help reduce costs.



Channel - 1) A method whereby a business dispenses its product, such as a retail or distribution channel, call center or web based electronic storefront. 2) A push technology that allows users to subscribe to a website to browse offline, automatically display updated pages on their screen savers, and download or receive notifications when pages in the website are modified. Channels are available only in browsers that support channel definitions, such as Microsoft Internet Explorer version 4.0 and above.



Channel Charging area - A warehouse area where a company maintains battery chargers and extra batteries to support a fleet of electrically powered materials handling equipment. The company must maintain this area in accordance with government safety regulations.



Channel Conflict - This occurs when various sales channels within a company's supply chain compete with each other for the same business. An example is where a retail channel is in competition with a web based channel set up by the company.



Channel Partners - Members of a supply chain (i.e. suppliers, manufacturers, distributors, retailers, etc.) who work in conjunction with one another to manufacture, distribute, and sell a specific product.



Channels of Distribution - Any series of firms or individuals that participates in the flow of goods and services from the raw material supplier and producer to the final user or consumer. Also see Distribution



Chock - A wedge, usually made of hard rubber or steel, that is firmly placed under the wheel of a trailer, truck, or boxcar to stop it from rolling.



CI - See Continuous Improvement



CIF - See Cost, Insurance, Freight.



City driver - A motor carrier driver who drives a local route as opposed to a long-distance, intercity route.



Civil Aeronautics Board - A federal regulatory agency that implemented economic regulatory controls over air carriers.



CL - Carload rail service requiring shipper to meet minimum weight.



Claim - A charge made against a carrier for loss, damage, delay, or overcharge.



Class I carrier - A classification of regulated carriers based upon annual operating revenues--motor carriers of property > or = $5 million



Class II carrier - A classification of regulated carriers based upon annual operating revenues--motor carriers of property $1-$5 million



Class III carrier - A classification of regulated carriers based upon annual operating revenues--motor carriers of property < or = $1 million



Class rate - A rate constructed from a classification and a uniform distance system. A class rate is available for any product between any two points.



Classification - An alphabetical listing \of commodities, the class or rating into which the commodity is placed, and the minimum weight necessary for the rate discount



Classification yard - A railroad terminal area where rail cars are grouped together to form train units.



CLCA - See Closed-loop corrective action.



Clearinghouse - A conventional or limited purpose entity generally restricted to providing specialized services, such as clearing funds or settling accounts.



Click-and-Mortar - With reference to a traditional brick-and-mortar company that has expanded its presence online. Many brickand- mortar stores are now trying to establish an online presence but often have a difficult time doing so for many reasons. Clickand- mortar is "the successful combination of online and real world experience."



Clip Art - A collection of icons, buttons, and other useful image files, along with sound and video files that can be inserted into documents/web pages.



Clipboard - A temporary storage area on a computer for cut or copied items.



CLM - See Council of Supply Chain Management Professionals.



Closed-loop corrective action (CLCA) - A sophisticated engineering system designed to document, verify and diagnose failures, recommend and initiate corrective action, provide follow-up and maintain comprehensive statistical records.



Closed-loop MRP - A system built around material requirements planning that includes the additional planning processes of production planning (sales and operations planning), master production scheduling, and capacity requirements planning. Once this planning phase is complete and the plans have been accepted as realistic and attainable, the execution processes come into play. These processes include the manufacturing control processes of input-output (capacity) measurement, detailed scheduling and dispatching, as well as anticipated delay reports from both the plant and suppliers, supplier scheduling, and so on. The term closed loop implies not only that each of these processes is included in the overall system, but also that feedback is provided by the execution processes so that the planning can be kept valid at all times.



CMI - See Co-managed Inventory



CMM - See Capability Maturity Model



Co-destiny - The evolution of a supply chain from intra-organizational management to inter-organizational management.



Co-Managed Inventory (CMI) - A form of continuous replenishment in which the manufacturer is responsible for replenishment of standard merchandise, while the retailer manages the replenishment of promotional merchandise.



Co-opetition - A combination of cooperation and competition that offers the counter intuitive possibility for rivals to benefit from each other's seemingly competitive activities. In short, there are circumstances where having more players to cut the pie means bigger pieces of pie for everyone. An example would be found in the group buying setting where its use refers to the activity of multiple, normally competitive buying group members leveraging each other's buying power to gain reduced pricing.



Co-Packer - A contract co-packer produces goods and/or services for other companies, usually under the other company's label or name. Co-Packers are more frequently seen in CPG and Foods.



Co-product - The term co-product is used to describe multiple items that are produced simultaneously during a production run. Co-products are often used to increase yields in cutting operations such as die cutting or sawing when it is found that scrap can be reduced by combining multiple-sized products in a single production run. Co-products are also used to reduce the frequency of machine setups required in these same types of operations. Co-products, also known as byproducts, are also common in process manufacturing such as in chemical plants. Although the concept of co-products is fairly simple, the programming logic required to provide for planning and processing of co-products is very complicated.



COA - See Certificate of Analysis



Coastal carriers - Water carriers that provide service along coasts serving ports on the Atlantic or Pacific oceans or on the Gulf of Mexico



Code - A numeric, or alphanumeric, representation of text for exchanging commonly used information. For example commodity codes, carrier codes,



Codifying - The process of detailing a new standard.



COGS - See Cost of Goods Sold



Collaboration - Joint work and communication among people and systems including business partners, suppliers, and customers to achieve a common business goal.



Collaborative Planning, Forecasting and Replenishment (CPFR) - 1) A collaboration process whereby supply chain trading partners can jointly plan key supply chain activities from production and delivery of raw materials to production and delivery of final products to end customers. Collaboration encompasses business planning, sales forecasting, and all operations required to replenish raw materials and finished goods. 2) A process philosophy for facilitating collaborative communications. CPFR is considered a standard, endorsed by the Voluntary Inter-industry Commerce Standards.



Combined Lead Time - See Cumulative Lead Time



Commercial zone - The area surrounding a city or town to which rates quoted for the city or town also apply



Committed Capability - The portion of the production capability that is currently in use, or is scheduled for use.



Committee of American Steamship Lines - An industry association representing subsidized U.S. Flag steamship firms.



Commodities clause - A clause that prohibits railroads from hauling commodities that they produced, mined, owned, or had an interest in.



Commodity - An item that is traded in commerce. The term usually implies an undifferentiated product competing primarily on price and availability.



Commodity Buying - Grouping like parts or materials under one buyer's control for the procurement of all requirements to support production.



Commodity Procurement Strategy - The purchasing plan for a family of items. This would include the plan to manage the supplier base and solve problems.



Commodity rate - A rate for a specific commodity and its origin-destination.



Common Carrier - Transportation available to the public that does not provide special treatment to any one party and is regulated as to the rates charged, the liability assumed, and the service provided. A common carrier must obtain a certificate of public convenience and necessity from the Federal Trade Commission for interstate traffic.



Common carrier duties - Common carriers are required to serve, deliver, charge reasonable rates, and not discriminate.



Common cost - A cost that cannot be directly assignable to particular segments of the business but that is incurred for the business as a whole.



Communication Protocol - The method by which two computers coordinate their communications. BISYNC and MNP are two examples.



Commuter - An exempt for-hire air carrier that publishes a time schedule on specific routes



Company Culture - A system of values, beliefs, and behaviors inherent in a company. To optimize business performance, top management must define and create the necessary culture.



Comparative advantage - A principle based on the assumption that an area will specialize in the production of goods for which it has the greatest advantage or least comparative disadvantage.



Competitive Advantage - Value created by a company for its customers that clearly distinguishes it from the competition, and provides its customers a reason to remain loyal.



Competitive Benchmarking - Benchmarking a product or service against competitors. Also see Benchmarking



Competitive Bid - A price/service offering by a supplier that must compete with offerings from other suppliers.



Complete & On-Time Delivery (COTD) - A measure of customer service. All items on any given order must be delivered on time for the order to be considered as complete and on time



Complete Manufacture to Ship Time - Average time from when a unit is declared shippable by manufacturing until the unit actually ships to a customer.



Compliance - Meaning that products, services, processes and/or documents comply with requirements.



Compliance Checking - The function of EDI processing software that ensures that all transmissions contain the mandatory information demanded by the EDI standard. Compares information sent by an EDI user against EDI standards and reports exceptions. Does not ensure that documents are complete and fully accurate, but does reject transmissions with missing data elements or syntax errors.



Compliance Monitoring - A check done by the VAN/third party network or the translation software to ensure the data being exchanged is in the correct format for the standard being used.



Compliance Program - A method by which two or more EDI trading partners periodically report conformity to agreed upon standards of control and audit. Management produces statements of compliance, which briefly note any exceptions, as well as corrective action planned or taken, in accordance with operating rules. Auditors produce an independent and objective statement of opinion on management statements.



Component - Material that will contribute to a finished product but is not the finished product itself. Examples would include tires for an automobile, power supply for a personal computer, or a zipper for a ski parka. Note that what is a component to the manufacturer may be considered the finished product of their supplier.



Computer Aided Engineering (CAE) - The use of computers to model design options to stimulate their performance.



Computer-aided design (CAD) - Computer-based systems for product design that may incorporate analytical and "what if" capabilities to optimize product designs. Many CAD systems capture geometric and other product characteristics for engineeringdata- management systems, producibility and cost analysis, and performance analysis. In many cases, CAD-generated data



Computer-aided manufacturing (CAM) - Computerized systems in which manufacturing instructions are downloaded to automated equipment or to operator workstations.



Computer-aided process planning (CAPP) - Software-based systems that aid manufacturing engineers in creating a process plan to manufacture a product who's geometric, electronic, and other characteristics have been captured in a CAD database. CAPP systems address such manufacturing criteria as target costs, target lead times, anticipated production volumes, availability of



Computer-Based Training (CBT) - Training that is delivered via computer workstation and includes all training and testing materials.



Computer-integrated manufacturing (CIM) - A variety of approaches in which computer systems communicate or interoperate over a local-area network. Typically, CIM systems link management functions with engineering, manufacturing, and support operations. In the factory, CIM systems may control the sequencing of production operations, control operation of automated equipment and conveyor systems, transmit manufacturing instructions, capture data at various stages of the manufacturing or assembly process, facilitate tracking and analysis of test results and operating parameters, or a combination of these.



Computerized maintenance management systems (CMMS) - Software-based systems that analyze operating conditions of production equipment vibration, oil analysis, heat, etc. and equipment-failure data, and apply that data to the scheduling of maintenance and repair inventory orders and routine maintenance functions. A CMMS prevents unscheduled machine downtime and optimizes a plant's ability to process product at optimum volumes and quality levels.



Computerized process simulation - Use of computer simulation to facilitate sequencing of production operations, analysis of production flows, and layout of manufacturing facilities.



Computerized SPC - See Statistical process control



Concurrent engineering - A cross-functional, team-based approach in which the product and the manufacturing process are designed and configured within the same time frame, rather than sequentially. Ease and cost of manufacturability, as well as customer needs, quality issues, and product-life-cycle costs are taken into account earlier in the development cycle. Fully configured concurrent engineering teams include representation from marketing, design engineering, manufacturing engineering, and purchasing, as well as supplierand even customercompanies.



Configuration - The arrangement of components as specified to produce an assembly.



Configure/Package-to-Order - A process where the trigger to begin manufacture, final assembly or packaging of a product is an actual customer order or release, rather than a market forecast. In order to be considered a Configure-to-Order environment, less than 20% of the value-added takes place after the receipt of the order or release, and virtually all necessary design and process documentation is available at time of order receipt.



Confirmation - With regards to EDI, a formal notice (by message or code) from a electronic mailbox system or EDI server indicating that a message sent to a trading partner has reached its intended mailbox or been retrieved by the addressee.



Confirming Order - A purchase order issued to a supplier, listing the goods or services and terms of an order placed orally or otherwise before the usual purchase document.



Conformance - An affirmative indication or judgment that a product or service has met the requirements of a relevant specification, contract, or regulation. Synonym Compliance.



Conrail - The Consolidated Rail Corporation established by the Regional Reorganization Act of 1973 to operate the bankrupt Penn Central Railroad and other bankrupt railroads in the Northeast



Consensus - A state in which all the members of a group support an action or decision, even if some of them don't fully agree with it.



Consignee - The party to whom goods are shipped and delivered. The receiver of a freight shipment.



Consignment - 1) A shipment that is handled by a common carrier. 2) The process of a supplier placing goods at a customer location without receiving payment until after the goods are used or sold. Also see Consignment Inventory



Consignment Inventory - 1) Goods or product that are paid for when they are sold by the reseller, not at the time they are shipped to the reseller. 2) Goods or products which are owned by the vendor until they are sold to the consumer.



Consignor - The party who originates a shipment of goods (shipper). The sender of a freight shipment, usually the seller.



Consolidation - Combining two or more shipments in order to realize lower transportation rates. Inbound consolidation from vendors is called make-bulk consolidation



Consortium - A group of companies that work together to jointly produce a product, service, or project.



Constraint - A bottleneck, obstacle or planned control that limits throughput or the utilization of capacity.



Consumer packaged goods (CPG) - Consumable goods such as food and beverages, footwear and apparel, tobacco, and cleaning products. In general, CPGs are things that get used up and have to be replaced frequently, in contrast to items that people usually keep for a long time, such as cars and furniture.



Consumer-Centric Database - Database with information about a retailer's individual consumers, used primarily for marketing and promotion.



Consuming the Forecast - The process of reducing the forecast by customer orders or other types of actual demands as they are received. The adjustments yield the value of the remaining forecast for each period.



Container - 1) A "box," typically 10 to 40 feet long, which is primarily used for ocean freight shipments. For travel to and from ports, containers are loaded onto truck chassis or on railroad flatcars. 2) The packaging, such as a carton, case, box, bucket, drum, bin, bottle, bundle, or bag, that an item is packed and shipped in.



Container Security Initiative (CSI) - U.S. Customs program to prevent global containerized cargo from being exploited by terrorists. Designed to enhance security of sea cargo container.



Containerization - A shipment method in which commodities are placed in containers, and after initial loading, the commodities per se are not re-handled in shipment until they are unloaded at the destination.



Contingency planning - Preparing to deal with calamities (e.g., floods) and non-calamitous situations (e.g., strikes) before they occur



Continuous Flow Distribution (CFD) - The streamlined pull of products in response to customer requirements while minimizing the total costs of distribution.



Continuous Improvement (CI) - A structured measurement driven process that continually reviews and improves performance.



Continuous Process Improvement (CPI) - A never-ending effort to expose and eliminate root causes of problems



Continuous Replenishment - Continuous Replenishment is the practice of partnering between distribution channel members that changes the traditional replenishment process from distributor-generated purchase orders, based on economic order quantities, to the replenishment of products based on actual and forecasted product demand.



Continuous Replenishment Planning (CRP) - A program that triggers the manufacturing and movement of product through the supply chain when the identical product is purchased by an end user.



Continuous-flow, fixed-path equipment - Materials handling devices that include conveyors and drag lines.



Contract - An agreement between two or more competent persons or companies to perform or not to perform specific acts or services or to deliver merchandise. A contract may be oral or written. A purchase order, when accepted by a supplier, becomes a contract. Acceptance may be in writing or by performance, unless the purchase order requires acceptance in writing.



Contract Administration - Managing all aspects of a contract to guarantee that the contractor fulfills his obligations.



Contract Carrier - A carrier that does not serve the general public, but provides transportation for hire for one or a limited number of shippers under a specific contract.



Contribution - The difference between sales price and variable costs. Contribution is used to cover fixed costs and profits.



Contribution Margin - An amount equal to the difference between sales revenue and variable costs.



Controlled Access - Referring to an area within a warehouse or yard that is fenced and gated. These areas are typically used to store high-value items and may be monitored by security cameras



Conveyor - A materials handling device that moves freight from one area to another in a warehouse. Roller conveyors make sue of gravity, whereas belt conveyors use motors.



Cookie - A computer term. A piece of information from your computer that references what the user has clicked on, or references information that is stored in a text file on the user's hard drive (such as a username). Another way to describe cookies is to say they are tiny files containing information about individual computers that can be used by advertisers to track online interests and tastes. Cookies are also used in the process of purchasing items on the Web. It is because of the cookie that the "shopping cart" technology works. By saving in a text file, the name, and other important information about an item a user "clicks" on as they move through a shopping Website, a user can later go to an order form, and see all the items they selected, ready for quick and easy processing.



Cooperative associations - Groups of firms or individuals having common interests agricultural cooperative associations may haul up to 25% of their total interstate tonnage in nonfarm, nonmenber goods in movements incidental and necessary to their primary business.



Coordinated transportation - Two or more carriers of different modes transporting a shipment.



Core Competency - Bundles of skills or knowledge sets that enable a firm to provide the greatest level of value to its customers in a way that is difficult for competitors to emulate and that provides for future growth. Core competencies are embodied in the skills of the workers and in the organization. They are developed through -collective -learning, communication, and commitment to work across levels and functions in the organization and with the customers and suppliers. For example, a core competency could be the capability of a firm to coordinate and harmonize diverse production skills and multiple technologies. To illustrate, advanced casting processes for making steel require the integration of machine design with sophisticated sensors to track temperature and speed, and the sensors require mathematical modeling of heat transfer. For rapid and effective development of such a process, materials scientists must work closely with machine designers, software engineers, process specialists, and operating personnel. Core competencies are not directly related to the product or market.



Core Process - That unique capability that is central to a company's competitive strategy.



Cost Accounting - The branch of accounting that is concerned with recording and reporting business operating costs. It includes the reporting of costs by departments, activities, and products.



Cost Allocation - In accounting, the assignment of costs that cannot be directly related to production activities via more measurable means, e.g., assigning corporate expenses to different products via direct labor costs or hours.



Cost Center - In accounting, a sub-unit in an organization that is responsible for costs.



Cost Driver - In accounting, any situation or event that causes a change in the consumption of a resource, or influences quality or cycle time. An activity may have multiple cost drivers. Cost drivers do not necessarily need to be quantified



Cost Driver Analysis - In cost accounting, the examination, quantification, and explanation of the effects of cost drivers. The results are often used for continuous improvement programs to reduce throughput times, improve quality, and reduce cost.



Cost Element - In cost accounting, the lowest level component of a resource, activity, or cost object.



Cost Management - The management and control of activities and drivers to calculate accurate product and service costs, improve business processes, eliminate waste, influence cost drivers, and plan operations. The resulting information will have utility in setting and evaluating an organization's strategies.



Cost of Capital - The cost to borrow or invest capital.



Cost of Goods Sold (COGS) - The amount of direct materials, direct labor, and allocated overhead associated with products sold during a given period of time, determined in accordance with Generally Accepted Accounting Principles (GAAP)



Cost of lost sales - The forgone profit associated with a stockout.



Cost trade-off - The interrelationship among system variables indicates that a change in one variable has cost impact upon other variables. A cost reduction in one variable may be at the expense of increased cost for other variables, and vice versa.



Cost Variance - In cost accounting, the difference between what has been budgeted for an activity and what it actually costs.



Cost, Insurance, Freight (CIF) - A freight term indicating that the seller is responsible for cost, the marine insurance, and the freight charges on an ocean shipment of goods.



COTD - See Complete & On-Time Delivery



Council of Logistics Management (CLM) - See Council of Supply Chain Management Professionals.



Council of Supply Chain Management Professionals (CSCMP) - The CSCMP is a not-for-profit professional business organization consisting of individuals throughout the world who have interests and/or responsibilities in logistics and supply chain management, and the related functions that make up these professions. Its purpose is to enhance the development of the logistics and supply chain management professions by providing these individuals with educational opportunities and relevant information through a variety of programs, services, and activities.



Courier service - A fast, door-to-door service for high-valued goods and documents



CPFR - See Collaborative Planning Forecasting and Replenishment



CPG - See Consumer Packaged Goods



CPI - See Continuous Process Improvement



Credit Level - The amount of purchasing credit a customer has available. Usually defined by the internal credit department and reduced by any existing unpaid bills or open orders.



Critical Differentiators - This is what makes an idea, product, service or business model unique.



Critical Success Factor (CSF) - Those activities and/or processes that must be completed and/or controlled to enable a company to reach its goals.



Critical value analysis - A modified ABC analysis in which a subjective value of criticalness is assigned to each item in the inventory.



CRM - See Customer Relationship Management



Cross Docking - A distribution system in which merchandise received at the warehouse or distribution center is not put away, but instead is readied for shipment to retail stores. Cross docking requires close synchronization of all inbound and outbound shipment movements. By eliminating the put-away, storage and selection operations, it can significantly reduce distribution costs.



Cross functional - A term used to describe a process or an activity that crosses the boundary between functions. A cross functional team consists of individuals from more than one organizational unit or function.



Cross Sell - The practice of attempting to sell additional products to a customer during a sales call. For example, when the CSR presents a camera case and accessories to a customer that is ordering a camera



Cross-Shipment - Material flow activity where materials are shipped to customers from a secondary shipping point rather than from a preferred shipping point.



Cross-Subsidy - In cost accounting, the inequitable assignment of costs to cost objects, which leads to over costing or under costing them relative to the amount of activities and resources actually consumed. This may result in poor management decisions that are inconsistent with the economic goals of the organization.



CRP - See Continuous Replenishment Program



CSCMP - See Council of Supply Chain Management Professionals.



CSF - See Critical Success Factor



CSI - See Container Security Initiative



CSR - See Customer Service Representative



CTP - See Capacity to Promise



Cubage - Cubic volume of space being used or available for shipping or storage.



Cube - The volume of the shipment or package (the product of the length x width x depth).



Cube Utilization - In warehousing, a measurement of the utilization of the total storage capacity of a vehicle or warehouse.



Cubic Space - In warehousing, a measurement of space available or required in transportation and warehousing.



Cumulative Available-to-Promise - A calculation based on the available-to-promise (ATP) figure in the master schedule. Two methods of computing the cumulative available-to-promise are used, with and without lookahead calculation. The cumulative with lookahead ATP equals the ATP from the previous period plus the MPS of the period minus the backlog of the period minus the sum of the differences between the backlogs and MPSs of all future periods until, but not to include, the period where point production exceeds the backlogs. The cumulative without lookahead procedure equals the ATP in the previous period plus the MPS, minus the backlog in the period being considered. Also see Available-to-Promise



Cumulative Lead Time - The total time required to source components, build and ship a product.



Cumulative Source/Make Cycle Time - The cumulative internal and external lead time to manufacture shippable product, assuming that there is no inventory on-hand, no materials or parts on order, and no prior forecasts existing with suppliers. (An element of Total Supply Chain Response Time)Calculation The critical path along the following elements Total Sourcing Lead Time, Manufacturing Order Release to Start Manufacturing, Total Manufacture Cycle Time (Make-to-Order, Engineer-to-Order, Configure/Package-to-Order) or Manufacture Cycle Time (Make-to-Stock), Complete Manufacture to Ship Time Note Determined separately for Make-to-Order, Configure/Package-to-Order, Engineer-to-Order, and Make-to-Stock products



Currency adjustment factor (CAF) - An added charge assessed by water carriers for currency value changes.



Current good manufacturing practices (CGMP) - Regulations enforced by the U.S. Food and Drug Administration for food and chemical manufacturers and packagers.



Customer - 1) In distribution, the Trading Partner or reseller, i.e. Wal-Mart, Safeway, or CVS. 2) In Direct-to-Consumer, the end customer or user.



Customer Acquisition or Retention - The rate by which new customers are acquired, or existing customers are retained. A key selling point to potential marquis partners. Also see Marquis Partner



Customer Driven - The end user, or customer, motivates what is produced or how it is delivered.



Customer Facing - Those personnel whose jobs entail actual contact with the customer.



Customer Interaction Center - See Call Center



Customer Order - An order from a customer for a particular product or a number of products. It is often referred to as an actual demand to distinguish it from a forecasted demand.



Customer Profitability - The practice of placing a value on the profit generated by business done with a particular customer.



Customer Receipt of Order to Installation Complete - Average lead-time from receipt of goods at the customer to the time when installation (if applicable) is complete, including the following sub-elements time to get product up and running, and product acceptance by customer. (An element of Order Fulfillment Lead Time) Note Determined separately for Make-to-Order, Configure/Package-to-Order, Engineer-to-Order, and Make-to-Stock products.



Customer Relationship Management (CRM) - This refers to information systems that help sales and marketing functions, as opposed to the ERP (Enterprise Resource Planning), which is for back-end integration.



Customer Segmentation - Dividing customers into groups based on specific criteria, such as products purchased, customer geographic location, etc.



Customer service - Activities between the buyer and seller that enhance or facilitate the sale or use of the seller's products or services.



Customer Service Ratio - See Percent of Fill



Customer Service Representative (CSR) - The individual who provides customer support via telephone in a call center environment.



Customer Signature/Authorization to Order Receipt - Average lead-time from when a customer authorizes an order to the time that that order is received and order entry can commence. (An element of Order Fulfillment Lead Time) Note Determined separately for Make-to-Order, Configure/Package-to-Order, Engineer-to-Order, and Make-to-Stock products.



Customer-Supplier Partnership - A long-term relationship between a buyer and a supplier characterized by teamwork and mutual confidence. The supplier is considered an extension of the buyer's organization. The partnership is based on several commitments. The buyer provides long-term contracts and uses fewer suppliers. The supplier implements quality assurance processes so that incoming inspection can be minimized. The supplier also helps the buyer reduce costs and improve product and process designs.



Customer/Order Fulfillment Process - A series of customers' interactions with an organization through the order filling process, including product/service design, production and delivery, and order status reporting.



Customization - Creating a product from existing components into an individual order. Synonym Build to Order.



Customs House Broker - A business firm that oversees the movement of international shipments through customs and ensures that the documentation accompanying a shipment is complete and accurate.



Customs-Trade Partnership against Terrorism (C-TPAT) - A joint government/business initiative to build cooperative relationships that strengthen overall supply chain and border security. The voluntary program is designed to share information that will protect against terrorists' compromising the supply chain.



CWT - See Hundredweight



Cycle Counting - An inventory accuracy audit technique where inventory is counted on a cyclic schedule rather than once a year. A cycle inventory count is usually taken on a regular, defined basis (often more frequently for high-value or fast-moving items and less frequently for low-value or slow-moving items). Most effective cycle counting systems require the counting of a certain number of items every workday with each item counted at a prescribed frequency. The key purpose of cycle counting is to identify items in error, thus triggering research, identification, and elimination of the cause of the errors.



Cycle inventory - An inventory system where counts are performed continuously, often eliminating the need for an annual overall inventory. It is usually set up so that A items are counted regularly (i.e., every month), B items are counted semiregularly (every quarter or six months), and C items are counted perhaps only once a year.



Cycle Time - The amount of time it takes to complete a business process.



Cycle Time to Process Excess Product Returns for Resale - The total time to process goods returned as Excess by customer or distribution centers, in preparation for resale. This cycle time includes the time a Return Product Authorization (RPA) is created to the time the RPA is approved, from Product Available for Pick-up to Product Received and from Product Receipt to Product Available for use.



Cycle Time to Process Obsolete and End-of-Life Product Returns for Disposal - The total time to process goods returned as Obsolete & End of Life to actual Disposal. This cycle time includes the time a Return Product Authorization (RPA) is created to the time the RPA is approved, from Product Available for Pick-up to Product Received and from Product Receipt to Product Disposal/Recycle.



Cycle Time to Repair or Refurbish Returns for Use - The total time to process goods returned for repair or refurbishing. This cycle time includes the time a Return Product Authorization (RPA) is created to the time the RPA is approved, from Product Available for Pick-up to Product Received, from Product Receipt to Product Repair/Refurbish begin, and from Product Repair/Refurbish begin to Product Available for use.



Cyclical Demand - A situation where demand patterns for a product run in cycles driven by seasonality or other predictable factors.