Key terms chapter 5

1. Agile supply chain: Focuses on an organization's ability to respond to

changes in demand with respect to volume and variety.
2. Bullwhip effect: Characterized by variability in demand orders among
supply chain participants.
3. Contract logistics: refers to the outsourcing of resource management
tasks by one company to a third-party company specializing in logistical
matters, such as transportation, warehousing, and order fulfillment.
4. Fast supply chain: Emphasizes a speed or time component.
5. Fourth-party logistics: General contractor that ensures that third-party
logistics companies are working toward relevant supply chain goals and
objectives.
6. GSCF model: Global Supply Chain Forum model, a framework that
identifies eight relevant processes, such as customer relationship
management, demand management, and order fulfillment, associated with
supply chain management.
7. Lead logistics provider: Appears to be emerging as the moniker of choice,
but some providers, such as UPS Supply Chain Services, don't use either
term to describe their services.
8. Leagility: Combines agility and leanness as a way to focus part of one's
supply chain on a timely response to customer orders and/or product variety
and another part of the supply chain on leveling out the planning
requirements to smooth production output.
9. Lean supply chain: Focuses on eliminating all waste, including time, and
ensuring a level schedule.
10. Perfect order: An order that simultaneously achieves relevant customer
metrics.
11. Relational exchanges: A long-term orientation among supply chain parties
that is characterized by trust, commitment, dependence, joint investment
and shared benefits.
12. SCOR model (Supply Chain Operations Reference Model): A framework
that identifies five key processes plan, source, make, deliver, return
associated with supply chain management.
13. Supply chain: All activities associated with the flow and transformation of
goods from the raw material stage, through to the end user, as well as the
associated information flows.
14. Supply chain analytics: Combines technology with manual employee
effort to identify trends, perform comparisons and highlight opportunities in
supply chain processes, even when large amounts of data are involved.
15. Supply chain collaboration: Cooperative, formal or informal supply chain
relationships between manufacturing companies and their suppliers,
business partners, or customers, developed to enhance the overall business
performance of both sides.
16. Supply chain management: According to the Council of Supply Chain
Management Professionals, SCM encompasses the planning and
management of all activities involved in sourcing and procurement,
conversion, and all logistics management activities. Importantly, it also
includes coordination and collaboration with channel partners, which can be
suppliers, intermediaries, third-party service providers, and customers. In
essence, supply chain management integrates supply and demand
management within and across companies.
17. Supply chain partnership: Refers to a tailored business relationship
between two supply chain members.
18. Third-party logistics (logistics outsourcing): The general idea behind
these concepts is that one company (e.g. a manufacturer) allows a
specialist company to provide it with one or more logistics functions (e.g.,
warehousing, outbound transportation).
19. Transactional exchanges: Refers to a short-term orientation between
supply chain participants.
 Key terms chapter 6

1. Bribes: Money paid before an exchange.

2. Excess (surplus) materials: Stock that exceeds the reasonable
requirements of an organization.
3. FinTech: Refers to companies that use cloud-based software to optimize
the connection between procurement and accounts payable.
4. Global procurement (sourcing): Refers to buying components and inputs
anywhere in the world.
5. Investment recovery: Identifies opportunities to recover revenues or
reduce costs associated with scrap, surplus, obsolete, and waste materials.
6. Kickbacks: Money paid after an exchange.
7. Kraljic's Portfolio Matrix: A tool used by managers to classify corporate
purchases in terms of their importance and supply complexity.
8. Multiple sourcing: A procurement philosophy that suggests that by having
more than one supplier increased amounts of competition, greater supply
risk mitigation and improved market intelligence can arise.
9. Near-sourcing: Refers to companies reconfiguring their logistics networks
to bring some production facilities closer to key consumer markets.
10. Obsolete materials: Refer to materials that are not likely to ever be used
by the organization that purchased it.
11. Procurement: Raw materials, component parts, and supplies brought from
outside organizations to support a company's operations.
12. Procurement cards (p-cards): Is similar to a credit card for personal use,
only a p-card is used for organizational purchases.
13. Purchasing: Raw materials, component parts, and supplies brought from
outside organizations to support a company's operations.
14. Scrap materials: These are materials that are no longer serviceable, have
been discarded, or are a by-product of the production process.
15. Single sourcing: Consolidates purchase volume with a single supplier with
the hopes of enjoying lower costs per unit and increased cooperation and
communication in the supply relationship.
16. Strategic sourcing: Refers to taking a supply chain perspective towards
purchasing.
17. Sustainable procurement: Refers to the integration of social and
environmental considerations into all stages of the purchasing process.
18. Supplier audit: A process that assesses a supplier's structure, resources,
health, and technology.
19. Supplier development (reverse marketing): A degree of aggressive
procurement involvement not normally encountered in supplier selection.
20. Supplier scorecards: Are used by organizations to report performance
information to their suppliers.
21. Supply chain finance: Refers to a set of technology and financed-based
processes that strive to optimize cash flow by allowing businesses to extend
their payment terms to their suppliers while simultaneously allowing
suppliers to get paid early.
22. Supply management: A relational exchange approach involving a limited
number of suppliers.
23. Total cost of ownership (TCO): Refers to an approach where a firm
considers all the costs that can be assigned to the acquisition, use, and
maintenance of a purchase.
24. Waste materials: These are materials that have been spoiled, broken, or
otherwise rendered unfit for further use or reclamation.