Z94.14 - Operations & Inventory Planning & Control

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IMPLEMENTATION. The act of installing a system into operation. It concludes the system project with the exception of appropriate follow up or post-installation review.

INDENTED BILL OF MATERIAL. A form of multilevel bill of material. It exhibits the highest level sub-assemblies closest to the left margin. All the components going into these sub-assemblies are shown indented to the right of the margin, and all subsequent levels of components are indented farther to the right. If a component is used in more than one sub-assembly within a given product structure, it will appear more than once, under every sub-assembly in which it is used.

INDEPENDENT DEMAND. Demand for a finished good or a component unrelated to the demand for other items. Demand for finished goods, parts required for destructive testing and service parts requirements are some examples of independent demand. (See DEPENDENT DEMAND.)

INDIRECT LABOR. Work required to support production without being directly related to a specific product.

INFINITE LOADING. A loading method for CRP where work is assigned to work centers in specific time periods regardless of the capacity available to perform this work. Though infinite loading is not usually practiced today, it can be used for capacity planning. Infinite implies that a load can be put into a factory regardless of its capability to be processed. The concept obscures the fact that it is necessary to generate capacity requirements and compare these with available capacity before trying to adjust requirements to capacity. (See CAPACITY REQUIREMENTS PLANNING, FINITE LOADING.)

INGREDIENT. (See COMPONENT.)

INPUT. Work entering a production facility.

INPUT/OUTPUT CONTROL. Controls production capacity at the work centers. It monitors actual work entering and leaving each work center and compares it against planned inputs and outputs. The purpose is to reduce backlog and thus lead time. (See CAPACITY CONTROL, CLOSED-LOOP MRP.)

INTERACTIVE SCHEDULING. Computer scheduling where the process is either automatic or manually interrupted to allow the scheduler the opportunity to review and/or change the schedule.

INTERMITTENT PRODUCTION. A production system in which the productive units are organized according to function. The jobs pass through the functional departments in lots and each lot may have a different routing.

INTEROPERATION TIME. The time between thecompletion of an order at one work center and its start at the next. (See QUEUE TIME.)

INTERPLANT DEMAND. Material to be shipped to another plant or division within the corporation. Although it is not a customer order, it is usually handled by the master production scheduling system in a similar manner. (See DEMAND MANAGEMENT.)

INTRANSIT LEAD TIME. The time lag between the date of shipment (at supplier shipping point) and the date of receipt (at the customer's dock). Normally customers' orders specify the date by which goods should be at their dock. Consequently this date should be offset by intransit lead time for establishing a ship date for the supplier.

INTRINSIC FORECAST. A forecast made based on past history that is usually internal to the company, such as a forecast made from a moving average. Syn: statistical forecast. (See EXTRINSIC FORECAST.)

INVENTORY. Items that are in a stock point or work-in-process and which serve to decouple successive operations in the process of manufacturing a product and distributing it to the consumer. Inventories may consist of raw materials, work-in-process, or finished goods.

INVENTORY CONTROL. The activities and techniques of maintaining the stock of items at desired levels, whether they be raw materials, work-in-process, or finished goods. The objective is to minimize inventory while meeting all demands. (See iNVENTORY MANAGEMENT.)

INVENTORY MANAGEMENT. The branch of business management concerned with the planning and control of inventories. (See INVENTORY CONTROL.)

INVENTORY POLICY. A definite statement of management philosophy concerning inventories.

INVENTORY SHRINKAGE. Losses resulting from scrap, deterioration, pilferage, etc.

INVENTORY TURNOVER. The number of times that an inventory "turns over" or cycles during the year. One way to compute inventory turnover is to divide the average inventory level into the annual cost of sales. Syn: turns.

INVENTORY VALUATION. The value of the inventory at either its cost or its market value. Because inventory value can change with time, some recognition must be made of the age distribution of inventory. Therefore, the cost value of inventory, under accounting practice, is usually computed by first-in-first-out (FIFO), last-in-first-out (LIFO), or a standard cost system to establish the cost of goods sold.

INVENTORY WRITE-OFF. Deducting inventory dollars from the financial statement because the inventory is no longer saleable or because of shrinkage, i.e., the value of the physical inventory is less than its book value. Item. Any individual manufactured or purchased part or assembly. (See END PRODUCT, SUBASSEMBLY, COMPONENT, RAW MATERIALS.)

ITEM NUMBER. A number that serves to uniquely identify a product, component, or raw material. Syns: part number, product number, stock code.

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