In both lean and six sigma it is important to understand all aspects of waste, including inventory. One form of inventory is anticipation inventory. Anticipation inventory is built according to "anticipated" or some future demand. It is additional inventory that is created above and beyond the actual demand of customers according to forecasts, projections or trends. Some examples of anticipation inventory might be:
Reference: Apics Dictionary 14'th edition.
ABC classification or ABC analysis is a technique used in materials management. The ABC represents the different categories of inventory in your system and indicates the level of control each category requires. The Apics Dictionary 2015 edition defines the categories of the ABC system as:
A = The A group usually represents 10 percent to 20 percent by the number of items and 50 percent to 70 percent by projected dollar volume.
B = The B grouping usually represents about 20 percent of the items and about 20 percent of the dollar volume.
C = The C grouping usually contains 60 percent to 70 percent of the items and represents about 10 percent to 30 percent of the dollar volume.
It is important to note that there is no fixed numbers for each category. Each organization should customize their classification system based on a pareto analysis.
The nomogram is a computational aid which consists of two or more scales which are drawn and arranged so that results of calculations may be found by the linear connection points. The graph usually contains three parallel scales graduated for different variables so that when a straight line connects each value of any two, that value can be read directly from the third at the point of intersection.
Also Called: Alignment Chart
Assemble-To-Order describes a production environment in which a good or service can be assembled after receipt of a customer’s order. The key components (bulk, semi-finished, intermediate, subassembly, fabricated, purchased, packing, and so on) used in the assembly or finishing process are planned and usually stocked in anticipation of a customer order. Receipt of an order initiates assembly of the customized product. This strategy is useful where a large number of end products (based on the selection of options and accessories) can be assembled from common components.
Synonyms for Assemble-To-Order include Finish-To-Order and Make-To-Order.
Reference: Supply Chain Insights - Assemble to Order
When calculating Takt time you will need to know the available time. The available time is the total amount of time available minus breaks, lunch and planned downtime.
The ABC's of