A Terms in the Supply Chain Glossary


A
ABC Classification
A method of sorting items into three groups (A, B, and C) based on criteria such as annual dollar volume. Group A includes the most significant items (10–20%), which account for 50–70% of the dollar volume. Group B often represents 20% of the items and about 20% of the dollar volume. Group C comprises around 50% of the items but often only 10–30% of the dollar volume. The principle focuses on tighter management for Group A and less strict control for Group C.
Accessorial Charges
Additional fees for extra services provided during transportation.
Accounts Payable
The total amount a company owes for goods or services it has received but has not yet paid for.
Accounts Receivable
The total value of goods delivered or services provided for which payment has not yet been received.
Accreditation
The official recognition by an authoritative body that an individual, organization, or facility meets specific standards of competence, objectivity, and integrity.
Acquisition Cost
The expense incurred to purchase one or more units of an item, calculated by multiplying the order quantity by the unit cost.
Activity-Based Budgeting (ABB)
A budgeting approach that uses insights into activities and their cost drivers to forecast workloads and resource needs.
Activity-Based Cost Accounting
A system of cost accounting that tracks costs by activities performed and assigns them to products, customers, or projects based on cost drivers.
Activity-Based Costing (ABC)
A cost accounting model that determines the cost of resources consumed by activities related to specific products, services, or other drivers during a particular period.
Additive Manufacturing
Also known as 3D printing, it is the process of creating objects layer by layer from digital models.
Advanced Planning and Scheduling (APS)
A set of tools and methods that use advanced mathematical algorithms to analyze and optimize logistics and manufacturing operations over various timeframes. APS systems manage constraints and business rules to provide solutions for production scheduling, resource planning, demand management, and more. They often generate multiple scenarios for decision-making.
Agile Project Management
A flexible project management methodology ideal for dynamic environments, such as software development, where outcomes evolve through iterative subprojects rather than fixed plans.
Agile Supply Chain
A supply chain designed to adapt quickly and efficiently to unpredictable customer demands by reconfiguring its operations.
AGVs
AGVs (Automated Guided Vehicles) are robotic systems used in warehouses and distribution centers for material handling and transportation tasks. Warehouse AGVs are self-driving vehicles that autonomously navigate through warehouse facilities to perform various logistics tasks such as moving inventory, picking orders, and transporting goods without direct human operation. AGVs can significantly improve efficiency, reduce labor costs, and minimize errors in inventory management and order fulfillment processes.
American National Standards Institute (ANSI)
A coordinating body for U.S. standards, including electronic data interchange standards across industries.
American Society for Quality (ASQ)
An educational nonprofit organization established in 1946, dedicated to promoting quality improvement among individuals and organizations worldwide.
American Standard Code for Information Interchange (ASCII)
A standard seven-bit character encoding scheme used in computers to represent text for information interchange. An eighth bit is often added for error-checking purposes.
Analysis of Variance (ANOVA)
A statistical technique used to identify the impact of independent variables on a dependent variable and assess the significance of these relationships.
Analytics
The process of analyzing large data sets using statistical methods, mathematics, and software to uncover patterns that aid in decision-making.
ANSI
ANSI, or American National Standards Institute is a non-profit organization chartered to develop, maintain, and promulgate voluntary US national standards in a number of areas, especially with regards to setting EDI standards. ANSI is the US representative to the International Standards Organization (ISO).
Anti-Bribery Regulations
Laws established by countries to penalize organizations involved in bribery. These regulations are supported by international agreements, such as the OECD Anti-Bribery Convention.
APICS
A professional association founded in 1957 to advance operations management through education, certification, and global networking.
Approved Vendor List (AVL)
A list of suppliers verified and approved to provide goods or services based on factors like quality, cost, and reliability.
Artificial Intelligence
Artificial Intelligence (AI) refers to the simulation of human intelligence in machines that are programmed to think and learn like humans. Here's a concise definition: AI is the field of computer science focused on creating intelligent machines that can perform tasks that typically require human intelligence.
ASRS
ASRS or AS/RS is short for Automated Storage and Retrieval System. These systems are designed to automatically place and retrieve items from defined storage locations in a warehouse.
Augmented Reality
Technology that overlays digital information onto the physical world to enhance user experiences.
Automated Fulfillment Signals
Systems that use real-time data and automated triggers to manage supply chain processes like order placement, fulfillment, and returns, improving efficiency and visibility.
Automated Guided Vehicle System
A material-handling system that uses automated vehicles, like carts or pallet trucks, to transport goods without human intervention.

 
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