Term Glossary

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510(k) A 510(k) clearance allows a company to market a medical device after it has shown in the 510(k) that the medical device is substantially equivalent to a legally marketed device that is not subject to pre-market approval requirements.

Amended New Drug Application (ANDA) The drugg approval application required by the FDA to approve a generic pharmaceutical product.

Application Server The middle tier in a three-tiered application architecture. In this differentiated architecture, the client tier handles the presentation layer or user interface (UI), the middle tier handles the application, and the third tier is the data source.

Available To Promise (ATP) The uncommitted portion of inventory or planned production.

Back Office Organizations They support and or work with the front office for sales organizations and companies. These include marketing and engineering organizations for managing products can be sold, a pricing organization that manages pricing, a credit organization that manages customer credit, an inventory organization, and a shipping or order fulfillment organization.

Batch Record A batch record is typically a packet of information containing the master formula and processing steps that accompany a batch of product through the manufacturing process. These records are typically retained for seven years and typically reviewed in audits by the FDA.

Brand A specific product within a category, as indicated by an identifying mark or name. The brand name is the distinctive name of a product, the word part of a trademark or the name of the manufacturer; for example, Kellogg’s Special K is the brand name of one product produced by the Kellogg Company.

Brand Management The typical brand management framework gives a brand "group" or "team" -- generally comprised of several assistant brand or assistant marketing managers and one supervising brand manager -- responsibility for all matters relevant to their product or products.

Brand Name or ethical drug Brand-name drugs are generally given patent protection for 17-20 years from the date of submission of the patent. This provides protection for the innovator who laid out the initial costs (including research, development, and marketing expenses) to develop the new drug. However, when the patent expires, other drug companies can introduce competitive generic versions, but only after they have been thoroughly tested by the manufacturer and approved by the FDA.

Bill-To Customer A customer type that allows a customer, on behalf of a Sold-To Customer, to receive invoices for goods shipped or services rendered and to be responsible for payment. The Bill-To Customer can choose to have someone make the payment on his behalf.

Broker An independent agent or representative of various noncompetitive products in a retail market who represents a manufacturer and presents products, sales and special deals to a retailer or wholesaler

Build-To-Order Building and delivering a product based on a customer-specific order. Pull is an important concept of Build-To-Order.

Business Object Document (BOD) An Open Applications Group, Inc.(OAGI) defined transaction format used to communicate among enterprise business applications. The BODs, based on industry consensus, contain high quality business content represented in XML.

Buying Group (Group purchasing organization) Buying groups are administrative entities that aggregate buyers or members (co-op) to leverage there joint purchasing power. The buying group receives a small administrative fee for the service and the buyers receive discounts below the ‘wholesale’ list price that the distributor usually charges. Buying groups never actually handle or own any products; they simply negotiate contracts with manufactures on behalf of their members.

By-Product An incidental product of a base process.

Capacity To Promise (CTP) The uncommitted capacity of planned production.

Catch Weight Some products are prepackaged but priced by the pound, for example meats, cheeses and some fruits and vegetables. For these items, records and calculations must be based upon two sets of figure with different units of measurers—the number of units (cases) and the weight (pounds). The retailer orders a number of cases but the price is based on the pounds actually shipped.

Category Management (CM) A joint process between retailer and manufacturer where service and product categories are managed as strategic business units, producing enhanced business results by focusing on delivering consumer value.

Change Control The process and managing ‘change’ to assure that systems or processes are not impacted by the change. Typically involves approval, testing and documentation of the results. Major issue in regulated industries.

Channel Management Management of all aspects of the complex dealer, reseller, or distributor relationships which exist in the supply of the manufacturer’s product to the retailer, in order to ensure maximum sales and minimal costs.

Chargeback A fee paid to the distributor for selling a product at a contract price that is less than what the distributor paid for the product.

Client A client, also known as a client tier in software architecture, handles the user interface (UI), which is the computer through which the user interacts with the software. The client handles the presentation logic of the application but, in the simple client-server architecture, it can also handle the business or application logic.

Closed System A closed system means an environment in which system access is controlled by persons who are responsible for the current content of electronic records that are on the system.

Co-Product An intended result of a base process that generally has significant value. For example, in making apple juice, the core can be used for mash.

Continuous Improvement Continuous Improvement is striving for perfection by continually removing successive layers of Waste, as they are discovered. It is generally accepted that a complete transformation process from mass production to Lean Manufacturing takes years. Perfection is zero waste, and progress can’t be benchmarked against competitors’ levels of waste, but requires striving for world-class performance.

Clinical Trials The testing process conducted on animals and humans that ultimately proves the safety and efficacy of a drug or medical device.

CPFR The Collaborative Planning, Forecasting and Replenishment (CPFR®) offering will enable collaboration among all supply-chain-related activities. This collaboration will include setting common cross-enterprise goals and performance measures, creating category/item goals across partners and collaborating on sales and order forecasts. Performance will be monitored as collaborative activities are executed providing participants the ability to evaluate partners. www.cpfr.org

Credit Checking A process that enables the company to determine the credit limit of a business partner and the total owed by the business partner for shipped goods or ordered goods.

Currency A monetary amount qualifier that a governing body assigns for use as a medium of exchange.

Data Pool A Data Pool is a repository of GCI / GDAS data where trading partners can obtain, maintain and exchange information on items and parties in a standard format through electronic means. Multiple trading partners use data pools in order to align / synchronize their internal master databases (GCI GDS definition).

Data pools and the Global registry are connected so that they constitute one logical data pool which makes available to users, all required master data in a standardized and transparent way.

Days-of-Supply The amount of product calculated to meet customer demand between replenishments.

A device history record is a compilation of records pertaining to the production of a finished device. These records are typically retained for seven years and may be reviewed in audits by the FDA.

Device master record A device master record is a compilation of records pertaining to the specifications and procedures of a finished device. These records are typically retained for seven years and may be reviewed in audits by the FDA.

DB2 A database supplied by IBM. The database is available for all platforms and operating systems including UNIX, Linux, Win NT/2000, and OS/400.

Direct Material From a purchasing point the material used in the manufacturing process to make the end product.

Direct Order The capability for a buyer to enter a transaction directly into the Seller's system through dialup or Internet connection.

Direct Store Delivery (DSD) A method of delivering product from a distributor directly to the retail store, bypassing a retailer’s warehouse. The vendor manages the product from order to shelf. Major DSD categories include greeting cards, beverages, baked goods, snacks, pharmaceuticals, etc.

Distributor A business that does not manufacture its own products but purchases and resells these products. Such a business usually maintains a finished goods inventory (source: APICS Dictionary). For the purpose of Collaborative Planning, Forecasting, and Replenishment (CPFR@), the term distributor is intended to include retailers.

Dynamic Hypertext Markup Language (DHTML) An HTML document with dynamic content. The three components of DHTML pages are HTML, JavaScript, and cascading style sheets. The three components are tied together with the Document Object Model.

EAN.UCC System The EAN.UCC System is a set of standards enabling the efficient management of global, multi- industry supply chains by uniquely identifying products, shipping units, assets, locations, and services to improve business efficiency and productivity. The system is co-managed by EAN International and the Uniform Code Council (UCC@).

E-market Exchange An electronic marketplace where many buyers and sellers meet to determine prices and conduct business.

Efficient Consumer Response (ECR) Initiative between retailers and suppliers to reduce existing barriers by focusing on processes, methods, and techniques to optimize the supply chain. Currently, ECR has three primary focus areas: supply side (e.g., efficient replenishment), demand side (e.g., efficient assortment, efficient promotion, efficient product introduction), and enabling technologies (e.g., common data and communication standards, cost/profit and value measurement). The overall goal of ECR is to fulfill consumer wishes better, faster, and at less cost.

Electronic Data Interchange (EDI) A standard format for exchanging business data.

Enterprise Resource Planning (ERP) An management-oriented information system for identifying and planning the enterprise-wide resources that are needed to take, make, ship, and account for customer orders.

Every Part, Every Interval (EPEI) The concept of EPEI interval is key to lean manufacturing. The EPEI is the time it takes to run through every regular part produced in a process Knowing the EPEI helps determine the manufacturing lot size and supermarket quantities for each part produced in a manufacturing process, as well as the number of kanban cards in the replenishment loop.

eXtensible Markup Language (XML) A universal format that allows software developers to easily describe and deliver rich, structured data from any application in a standard, consistent way.

Firewall A set of related programs, located at a network gateway server that protects the resources of a private network from users of other networks. The term also implies the security policy that is used within the programs.

Flow After identifying the Value Stream for a product, the objective is to make the product value creation flow without obstacles. Enabling flow without interruption, detours, backflows, waiting and scrap is no easy matter and presents a constant challenge. The focus is on avoiding batch and queue between different steps in the process flow. There are many Lean Manufacturing methodologies and tools available for creating Flow, such as Single Minute Exchange of Dies to reduce changeover time, Poka-yoke and 5S. The end target is to enable Single-Piece Flow, meaning producing and delivering only one product at a time, to reduce Work-In-Process materials. Empirical studies show that creating Flow has the added benefits of improved quality and responsiveness, reduced lead time, and reduced space requirements.

Freight Consolidation Ganging of smaller shipments to cut costs, often as directed by a system or via pooling with a third party.

Generic, Generic Product or Generic Brand Product packaged and sold without brand name or advertisements. Usually of a standard grade as opposed to grade A or top quality. Offers customers lower quality at a lower price, and is packed in a plain package with only a simple product description and no brand name shown. Products may still be quality controlled, open dated and unit priced. Also referred to a no-name brand.

Generic Drug A generic drug is identical, or bioequivalent to a brand name drug in dosage form, safety, strength, route of administration, quality, performance characteristics and intended use.

Global Commerce Initiative (GCI) Initiative of retailers, manufacturers, and suppliers with the objective of building a collaborative inter-business process that will endorse a set of recommended standards, enabling technologies and best practices with worldwide application. The GCI will provide benefits to all users, large and small, wherever they operate, as well as facilitate global supply chain efficiency and effectiveness and consumer value through co-operation.

Global Registry A Registry is a global directory for the registration of items and parties. It can only contain data certified GCI compliant. It federates the GCI / GDAS compliant data pools and acts as a pointer to the data pools where master data has been originally and physically stored.

Global Trade Item Number (GTIN) An "umbrella" term used to describe the entire family of EAN/UCC data structures for trade items (products and services) identification. The family of data structures include: EAN/UCC-8, UCC-12, EAN/UCC-13, and EAN/UCC-14. Products at every level of product configuration (consumer selling unit, case level, inner pack level, pallet, shipper, etc.) require a unique GTIN. GTIN is a new term, not a standards change.

GMA Grocery Manufacturers of America, is the world's largest association of food, beverage and consumer product companies. GMA applies legal, scientific and political expertise from its member companies to vital food, nutrition and public policy issues affecting the industry. The association also leads efforts to increase productivity, efficiency and growth in the CPA industry www.gmabrands.com

Hypertext Markup Language (HTML) A universal format that is used for text and multimedia information on the Internet

HyperText Transfer Protocol (HTTP) HTTP is the fundamental, text-based protocol underlying both HTML and XML. A secure version, HTTPS, is also commonly used and consists of a security and authentication capability layered on top of HTTP. This protocol is the only Internet transport that is firewall friendly (does not require opening another port in the firewall).

Indirect Material The materials and supplies that a manufacturer needs to produce products.

Invoicing The process of producing a bill for goods or services purchased. The bill, or invoice, includes pertinent information regarding the quantity, price, terms, nature of delivery, etc.

Internet Kanban A term coined for the Internet implementation of a replenishment system. Taken from the methodology of inventory control that uses cards to control the replenishment flow of parts within work centers on the manufacturing floor.

Investigational device exemption (IDE) IDE allows the investigational device to be used in a clinical study in order to collect safety and effectiveness data required to support a Pre-market Approval (PMA) application or a Pre-market Notification [510(k)] submission to FDA

Java A programming language expressly designed for use in the distributed environment of the Internet.

Java applets Java applets are small pieces of Java code that are downloaded by a web browser to perform UI tasks that neither pure HTML nor JavaScript can accomplish. For example, a Java applet may be embedded in an HTML page to draw a graph of some data. Note that these are not stand-alone Java applications, but are simply small sections of Java code triggered by some web page.

Java Servlets A servlet is an applet that runs on the server side. Written in Java, servlets are server-and- platform independent. They provide a simple, consistent mechanism for extending the functionality of a web server and for accessing existing business systems.

JavaServer Pages (JSP) An extension of the servlet technology created to support authoring of HTML and XML pages. It makes it easier to combine fixed or static template data with dynamic content.

Just-In-Time (JIT) The concept of reducing inventories by working closely with suppliers to coordinate delivery of the right materials, in the right quantity, just in time for use in the next step in the manufacturing process/supply chain.

Kaizen The Japanese word for Continuous Improvement.

Kanban A method of JIT production that uses standard containers or lot sizes with a single card attached to each. It is a Pull system in which work centers use a card to signal that they wish to withdraw parts from feeding operations or suppliers. The Japanese word kanban, loosely translated, means card, billboard or sign.

Lean Manufacturing Lean Manufacturing, the most prevalent manufacturing strategy in the automotive industry, provides a way to do more with less - less human effort, less equipment, less time and less space - while coming closer and closer to providing customers with exactly what they want.

LIMS Lab Information Management System. A software application, that uses a relational database, to collate laboratory information such as tests, results, samples, instruments and people, and provide the tools to allow that information to be entered, tracked, documented and reported.

Linux An alternative operating system to Unix for use at some installations

Maintenance, Repair, Operating Supplies (MRO) Items used in support of general operations and maintenance, such as maintenance supplies, spare parts, and consumables used in the manufacturing process and supporting operations.

Medical Device Classes Class I - Devices subject to General Controls. Commodity like products that pose little patient risk such as a stethoscope or wheelchair.

Class 2 - Devices subject to General Controls and Special Controls that entail moderate patient risk such as an endoscope or x-ray machine.

Class 3 - Devices subject to General Controls, Special Controls, and Pre-market Clearance. Class III devices are those that sustain or support life, are implanted, or present a potential risks such that their safety and efficacy must be established in clinical trials such as an angioplasty catheter or pace maker.

Message-Oriented Middleware (MOM) A class of software that proves data or message transport services between applications, when the source and destination applications are typically distributed on different platforms and development/run-time environments. Software that exchanges asynchronous client/server messages using message queues.

Muda The Japanese word for Waste.

NDA (New Drug Application) A document submitted to the FDA that states the results of clinical trials and asks permission to market the drug to the public. The supporting clinical trails and application can easily take twelve years and cost $700 million dollars.

New Molecular Entity (NME) A new compound generated in basic pharmaceutical research. Often used as a measure of pharmaceutical R&D effectiveness. Currently only about twenty-five new molecular entities are discovered each year.

NT/2000 A popular deployment environment for the PowerSystem product, which includes MFG/PRO and IBM's Netfinity server.

Nutritional Labeling An accurate list of ingredients printed on food, beverage and drug labels.

OAGIS The Open Application Group Integration Specification. The OAG is a group of over 600 ERP-related vendors that are driving toward a common standard for integration. QAD products talk to each other using XML-encoded OAG Business Object Documents (BODs) that conform to the OAGIS.

Open Apps Server The Open App Server allows us to expose Progress procedures as Java routines, callable by e-business applications written in Java.

Oracle Oracle is an excellent alternative to the Progress database for customers with the necessary IT infrastructure. QAD MFG/PRO can use Oracle databases for data storage.

Out-of-Stock (OOS) A product temporarily oversold and unavailable in a retail store. Also, product not in supply in the warehouse. In wholesaling, it is a customer service standard used and measured as a percentage of orders placed that cannot be filled. Also known as Outs.

Overs, Shorts, Damages (OSDs) A discrepancy between products ordered and those received.

Pacemaker Process Any process along a value stream that sets the pace for the entire stream.

Pharmaceutical Drug Development Process Phase I-Small-scale human trials to determine safety. Typically include 20 to 60 patients and are six months to one year in length.

Pharmaceutical Drug Development Process Phase II-Preliminary trials on a drug's safety/efficacy. Typically include 100 to 500 patients and are one and one-half to two years in length.

Pharmaceutical Drug Development Process Phase III-Large-scale controlled clinical trials for efficacy/safety; also the last stage before a request for approval for commercial distribution is made to the FDA. Typically include 1,000 to 7,500 patients and are three to five years in length.

Pharmaceutical Drug Development Process A phase IV-Follow-up trial after a drug is released to the public.

Pitch The time needed in a production area to make one container of products. For example, if Takt Time equals 30 seconds and pack size is 20 pieces, pitch equals 10 pieces.

Poka Yoke Commonly referred to as Error-Proofing or Mistake-Proofing. The aim of Poka Yoke is to design devices that prevent mistakes from becoming defects by giving the earliest possible warning to enable response to abnormalities. Poka Yoke devices are not control devices, like thermostats, that take action every time, but rather they sense abnormalities and take action only when an abnormality is identified.

Point-of-Sale (POS) Place where the purchase is made at the check stand or scanning terminals in a retail store. The acronym "POS" frequently is used to describe the sales data generated at checkout scanners. The relief of inventory and computation of sales data at a time and place of sale, generally through the use of bar coding or magnetic media equipment.

Progress QAD uses Progress for data storage due to its cross-platform, internationalized, and easy deployment capabilities.

PMA (Pre Market Approval) An application to the FDA seeking permission to sell a medical device (rather than a drug) that is implanted, life-sustaining or life-supporting.

Pull An essential part of any Build-To-Order strategy. Having set up the framework for Flow, the next step is to only produce what the customer needs. Pull means that no one upstream should produce goods or services until the customer downstream asks for it.

Purchase Order (PO) The purchaser’s authorization that is used to formalize a purchase transaction with a supplier.

Purchaser A role that allows a party to buy goods or services.

Push The production of items required by a given schedule planned in advance. Push-based manufacturing is associated with producing products for which there is no demand.

Recall The process of identifying where lots/serialized items of ‘out of specification’ product were shipped and contacting the receiving party to retrieve/exchange the product. Information also reported to FDA enforcement group. FDA reports 354 prescription drug recalls in 2002, up from 248 in 2001.

Repetitive Manufacturing: Building the same product over and over again. Repetitive manufacturing, in contrast to Build-To-Order, does not involve building customer-specific products. However, It can be implemented with Lean Manufacturing strategies as well as Push-based manufacturing.

Replenishment Replenishment is the process of replacing material that has been consumed in a business operation.

Reverse Logistics The processing of returned merchandise from the customer's customer. This process includes matching RGA's (returned goods authorization identifications), sorting salvageable, repairable and non-salvageable inventories.

RFID Radio Frequency Identification. A technology for the automatic and untouched identification of physical objects with computer chips (RFID tags). Two types of RFID tags can be distinguished: passive RFID tags (without an energy supply) and active RFID tags (with a battery).

Scan-based Trading A new way of doing business between direct store delivery manufacturers and retailers. It incorporates daily point-of-sale data to pay for product, electronic communication technologies to eliminate discrepancies and inefficiencies, and various store-level operating improvements, such as open delivery windows and elimination of check-in, to speed product flow.

Specify Value What does and does not create value is to be specified from the customer’s perspective, and not from the perspective of individual companies, functions and departments.

Stock-Keeping Unit (SKU) The identification of a product by name and number. A single unit that has been completely assembled.

Supermarket In lean manufacturing terms, a supermarket is a tightly managed amount of inventory within the value stream to allow for a pull system. Supermarkets, often called inventory buffers, can contain either finished items or work-in-process. They are used to handle finished goods inventories being replenished from a continuous flow pacemaker process, between a continuous flow process and other manufacturing processes that are shared by other value streams, and for incoming parts and material being pulled from supplier locations.

Supply Chain Execution (SCE) A subset of Supply Chain Management, this is a framework of execution-oriented applications that enable the efficient procurement and supply of goods, services and information across enterprise boundaries to meet customer-specific demand. In its broadest sense, Supply Chain Execution includes manufacturing execution systems, warehouse management systems and other execution systems within the enterprise, as well as throughout the supply chain.

Supply Chain Management (SCM) A business strategy to improve shareholder and customer value by optimizing the flow of products, services and related information from source to customer. Supply Chain Management encompasses the processes of creating and fulfilling the market’s demand for goods and services, and involves a trading partner community engaged in a common goal of satisfying the end customer.

Supply Chain Planning (SCP) A subset of Supply Chain Management, this is the process of coordinating assets to optimize the delivery of goods, services and information from supplier to customer, balancing supply and demand. A Supply Chain Planning suite overlays a transactional system to provide planning, what-if scenario analysis capabilities and real-time demand commitments.

Taiichi Ohno Born in 1912, he developed the Toyota Production System using the quintessence of Japanese reasoning. He was an excellent originator of new ideas in the industrial world with a unique management style. His Japanese production system made planning for the manufacture of automobiles the most modern process in the world.

Takt Time Takt time, an important lean concept, represents the customer demand rate and is used to synchronize the rate of production with the rate of sales.

Thin Client or Three-tiered Architecture Processing is split between: 1) clients running the UI logic, 2) the application server running the business logic, and 3) the database. It is also referred to as a three-tiered architecture.

Toyota Production System (TPS) The manufacturing strategy of Toyota, widely regarded as the first implementation of Lean Manufacturing.

Trade Promotion Management A suite of applications for planning trade promotions, managing funds, and collecting and analyzing POS and third-party sales data and information on store execution (time to shelf, display effectiveness, out of stocks, etc.).

UCCnet UCCnet is a universal foundation for industry standards-based electronic commerce. It provides foundational product registry services, enabling the synchronization of item and location information among trading partners, trade exchanges, solution partners and national data pools. In addition, UCCnet facilitates interoperability among these groups by providing companies visibility to a wide range of information and resources.

Unix Unix is the predominant operating system for MFG/PRO deployments. Types include HPUX, IBM AIX, and Sun Solaris.

User Interface (UI) An interface that enables information to be passed between a human user and the software components of a computer system. Also, the portion n of an application that is visible to an end user on their computer screen.

Value chain A series of value-added process activities that incorporate demand creation and management linked with associated supply management.

Value Stream It requires identifying all steps necessary to design, order and produce the product across the whole value stream, to highlight non-value adding waste. The whole Value Stream covers processes from ordering raw materials to delivery of the finished product to the final customer. When mapping, focus should be horizontal across systems and departments, from order to delivery, not vertical in the departmental silo. It is necessary to manage whole Value Streams for specific products. In general, it is useful to divide activities into three categories:

Value Adding Activity Those activities that, in the eyes of the end customer, make a product more valuable. A value adding activity is simple to define; it results in something the customer would pay for.

Value Stream Mapping Identifying all the specific activities occurring along a Value Stream for a product or product family.

Waste Lean Manufacturing is a continuous attack on Waste. The seven Wastes in Lean Manufacturing are: overproduction, defects, unnecessary inventory, inappropriate processing, excessive transportation, waiting and unnecessary motion.

Web Server Although considered part of the middle-tiered application server, the Web server plays a key role in supporting the presentation layer or UI. It primarily supports the presentation layer by connecting with the client and directing all browser-based activity, while the application supports the business or application logic that runs the application.

XML Extensible Markup Language (XML) is the successor to HTML. While HTML is primarily intended for human-readable web pages, XML is perhaps more useful for application to application communication through firewalls. It is the defacto standard for Internet B2B communications.