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Glossary of Manufacturing - Manufacturing terms Category: Agriculture and Industry Date & country: 27/04/2011, USA Words: 2096

Journal:
In accounting, the journal holds basic financial data and supporting evidence that the financial accounts are based on actual, real transactions. Evidence may include supplier and customer receipts, contracts, business letters etc..

Journeyman:
a person who has completed an apprenticeship and is now in the position of earning his living in the trade or profession concerned.

JPEG:
Joint Photographic Experts Group.

Judgment (or Judgement) Creditor:
If a company or person sues another company for debt and obtains judgment in the court for that debt, the company/person is said to be a "judgment creditor".

JUSE:
Japanese Union of Scientists and Engineers.

Just in Time:
The system of manufacturing employed at the Toyota Motor Company, and devised by the late Taiichi Ohno, a former general manager and MD at Toyota's main plant at Koromo, Tokyo. The system involves the rearrangement of plant and the reorganisation of procedures so that material required for processing arrives exactly at the time it is needed. The o...

Kaizen Teian:
an employee suggestion scheme set up as an adjunct of a continuous improvement drive. Suggestions are elicited from shop floor and other employees, these then being evaluated by management and, if beneficial to the manufacturing process, duly put into effect. Financial awards may be made to staff based on the merits of the ideas they come up with.

Kaizen:
The effecting of continuous improvement by systematically making small beneficial changes on a continuous basis. Two kinds of change are possible in a company: (1) wholescale major changes, perhaps associated with the introduction of new technology or systems; and (2) gradual, never-ending change using existing resources to effect small improvemen...

Kalman Filters:
Synonymous with Bayesian Forecasting (qv), the term Kalman filters having its origin in engineering science.

Kanban:
A Japanese word with no equivalent in English (except, perhaps, "signage"), used by The Toyota Car Company since 1953 to mean a card about 3" x 5" in a plastic vinyl pouch holding brief, simple information relating to the manufacture to hand. A formal definition of kanban is: a card or signal conveying information and indicatin...

Kann Was:
a type of schwundgeld originating in January 2004 in Bad Oldesloe, Germany.

Kano Analysis:
A diagramming method devised by the Japanese quality expert Noriaki Kano in which each customer requirement relating to a manufactured object or service is placed in one or other of three classes: (1) Dissatisfiers or Basic Requirements - these are essential requirements and define the minimum baseline (for example: the car is provided with brakes;...

Katatataki:
allegedly, Japanese for an employee getting a tap on the shoulder so that his employer can say Goodbye! (Better than just being handed a black bin bag, one supposes.)

KBE:
Knowledge-Based Engineering.

Kerf Allowance:
An addition to the stated requirements of bar, rod, tubing and similar material to compensate for the small amount of material that will be lost in cutting operations.

KGD:
Known Good Die.

Kirschblute:
a type of schwundgeld originating in October 2004 in Witzenhausen, central Germany.

Kiss:
keep it simple stupid.

Kit:
The collection of those parts needed to complete a manufacturing job. Thus a job to make 50 bicycles will require a kit of 100 wheels, 50 frames, 50 handlebars ...

Kitting and Kitting Area:
An area in which a kit of parts is to be assembled prior to the commencement of a production job. In unruly and less than brilliantly managed factories, it has been known for kits to be "robbed" - ie for material in kits to be removed surreptitiously by operators wanting those parts for other jobs. If stock records are 100% correct, physi...

Knowledge Mapping:
A knowledge map is a type of functional map depicting what is known about some particular, critical variable relating to a product, over time (for example, what is known about the top speed of the average motor car, year by year from 1918 to the present).

kph
: kilometres per hour.

KPI:
Key Performance Indicator. A measurement believed by a company to be indicative of its business performance. For example, a KPI for an organisation concerned with production monitoring and control might be its inventory records accuracy, expressed as a percentage. See BAM and see also benchmarking.

KWA:
Key Word Analysis, a technique associated with design quality and failure avoidance.

KWIC:
Key Word in Context - a library and text classification and search technique.

KWOC:
Key Word out of context - a library classification and search technique.

Labour Costs:
In relation to determining the standard cost of a manufactured product, labour costs are expenditures incurred relating to wages and salaries. Labour costs may be direct or indirect. Contrast "Materials Costs" and "Expenses".

Labour Stability:
In Human Resources, this is often defined as (the number of employees exceeding one years service)/ ((total number of employees that were also, themselves, employed one year ago) x 100%.

Labour Turnover:
In Human Resources, this is often defined as (number of employees who left during a given year)/ (average number employed during the year) x 100%.

Lagging Indicator:
If a second event is known always to take place following a prior event, observation and analysis of the second event may allow conclusions to be drawn about the prior event. An example might be an uncrease in the demand for anti-theft devices following an increase in the rate of burglaries in an area. More importantly, see Leading Indicator.

Lake Wobegon Effect, The:
Lake Wobegon is a fictional town in Minnesota, the invention of author Garrison Keillor, where all the women are strong, all the men are good looking, and all the children are above average. The remarkable statistic relating to the children is the significance of Lake Wobegon's presence in this Glossary - in manufacturing quality, as Deming never ...

LAN
: Local Area Network (see also WAN).

Landmark:
(1) A type of schwundgeld launched in November 2005 in Reinstadt, central Germany; (2) An easily recognised geographic feature often used by a traveller to assist him in his journey.

Langelad Pipeline:
The world's longest sub-marine pipeline at 750 miles. The Langeled gas pipeline was opened in 2006, and runs from Nyhamna, Norway to Easington, Yorkshire (UK).

Lap Phasing:
Synonymous with Operation Overlapping, qv.

LAP:
Large Area Processing.

Lb:
An abbreviation, from the Latin libra, for a "pound", being the principal unit of weight in the Imperial system of weights and measures, as employed in the UK and US. 1 lb = 0.453 592 37 kgs.

LBO:
leveraged buy-out (ie a buy out by a person or group made with the help of someone else's money).

LC:
Low Cost.

LCA:
Life Cycle Assessment (see also Terotechnology).

LCD:
Liquid Crystal Display.

LCL:
(1) Less than Carload Lot, a largely American term meaning a vehicle or rail shipment which occupies less volume than a full load. (2) Lower Control Limit (on control charts in SPC).

LCOC:
Liquid Crystal On Silicon.

LCPC:
Life Cycle Product Cost (see also LCA).

LD50:
(Live/die 50:50). A theoretical yardstick in drug marketing, meant to represent the point in product efficacy at which half the consumers in the market will buy the product (and live) and half will not (and die). The concept of an LD50 point relates to Taguchi's loss to society (qv) - that is, for the consumer, there is no strict cut off point whic...

Leading Indicator:
In sales forecasting, if one event is known always to precede a second event, observation and analysis of the first event may allow conclusions (especially in regard to sales demand volumes) to be drawn about the second. Examples are: (1) statistics relating to births and the sale six months later of baby foods; and (2) housing starts and carpet s...

Leadtime Demand:
The demand for a product that is forecast to occur over the time necessary to secure its replenishment from the source of supply. If the forecast is F units/month, and the month comprises 20 days, then the daily forecast is F/20 units. Now if the replenishment leadtime is D days, the leadtime demand is F/20 x D units.

Leadtime Management:
Action taken at the shop supervisor level to shorten the leadtime of a current production job - see Operation Splitting, Operation Overlapping and Operation Compression.

Leadtime Offset:
In materials planning, all components needed in a manufacturing job are usually required to be available at a date equal to "the job's due date, less the job's overall leadtime". However, all of the components may not be needed together right from the start - for example, some may enter the production process part way through, after init...

Leadtime:
In manufacturing, leadtime is the assumed elapsed time from the point of entry of a job into production to its completion and final emergence therefrom. It is normal to consider manufacturing leadtime as consisting of five separate elements : queue time (time spent in queues waiting to begin); set-up (time to set the machine up for the job); run (...

Leakage:
See Shrinkage Factor.

Lean DRP:
See Fair Shares and DRPII.

Lean; Lean Manufacturing:
Lean means the conduct of manufacturing operations with minimum waste - ie with a minimum of the seven wastes of over production; waiting time; transportation; processing time itself; movement; the production of non-conforming product; and the maintenance of stock. In truth, the elimination of waste and the pursuit of lean manufacturin...

Learning Curve:
As more and more units of a product are produced, the time to make each one gets increasingly short and the cost of doing so increasingly less compared with the time and cost needed when the product was completely novel. The learning curve expresses the relationship between: (1) on the horizontal axis, the total number of units made so far, and (2...

Lease Purchase:
Synonymous with Hire Purchase, qv.

Lease:
A means of financing the payment for an asset. The company wishing to acquire the asset (the lessee) arranges with the organisation putting up the money (the lessor), and a simultaneous transaction then takes place as follows: The supplier of the asset sells the equipment to the lessor, and the lessee agrees to pay the lessor money to have immedia...

Least Processing Time:
See SPT.

LED:
Light Emitting Diode.

Ledger:
The collection of accounts maintained by a company. Typically, ledger types are distinguished as follows: personal ledger; private ledger; and nominal ledger (or impersonal ledger). Ledger records (ie records of sales, debts, receipt, encashments and so on ) are sometimes referred to as the company's "books".

Leeway:
In a Closed-Loop MRP system, the "leeway" is the number of days by which an open or firm plan should theoretically be rescheduled, so that plans in practice comply with the latest planning schedule calculated through MRP, but in fact will not be so rescheduled. For example, an open plan might need to be rescheduled in by 2 days to bring ...

LEO:
Low Earth Orbit, or the acronym for Lyons Electronic Office, a British computer developed in 1955 by the food company J.Lyons Ltd in conjunction with engineers from Cambridge University. (See A Computer called LEO, by Georgina Ferry, published 2003.)

Letter of Comfort:
An encouragement by a party, to a lender of money, that the lender should advance money to a third party. Such letters are often deliberately phrased in a vague manner, and are intended to fall short of being guarantees. Since they are usually come across in a commercial context, the writer of a letter of comfort should be very cautious in his phra...

Letter of Credit (L/C):
A letter of credit is a document, along with certain other accompanying certificates, intended to facilitate trade, especially international trade. The form of the L/C and the commercial and legal procedures accompanying it have been laid down by the International Chamber of Commerce (qv). The purpose of the L/C is to eliminate or reduce certain r...

Letter of Intent:
A "letter of intent" is often sought from a purchaser by a supplier to give the supplier assurance that initial work on the purchaser's behalf can safely be commenced and that a fully specified contract will duly be agreed. If the later formal contract is not, however, signed, the status of the letter of intent will in fact depend on cir...

Leverage:
when applied to financial management, the application of other people's money to our own.

LIBOR:
London Inter-Bank Offered Rate - The rate of interest at which London banks offer to lend money to other banks, the rate being based on the lending bank's base rate.

Life Cycle (of a Product):
The period from a product's launch to its final withdrawal from the selling range. Usually, the life cycle can be illustrated by the familiar changes in demand levels which occur. Thus, on launch, demand increases very rapidly in accordance with the product's appeal to the marketplace. Demand then flattens out and remains at a high, steady level f...

Lifed Item:
A tool or piece of equipment against which the supplier or tools store supervisor has assigned a likely life span. The life span will typically be nominated in terms of usage - say, 1000 hours, or 50,000 miles.

LIFFE (pronounced "life"):
The London International Financial Futures Exchange, the market in the City of London in which bonds and currencies are bought and sold. The value of contracts in a given month amount to many thousands of billion pounds.

LIFO (Last in, First out):
The opposite of FIFO (qv). From the viewpoint of stock rotation, it can rarely be correct to retain the oldest stock. However, if the stocked items are not liable to deteriorate with age, normal stock rotation may be irrelevant. Consequently, with heavy goods such as concrete blocks and other building materials, it may be convenient to store incom...

Limiting Quality Level (LQL):
A quality level that a supplier agrees with a customer that it will equal or exceed, expressed as a percentage of non-conforming items.

Line Department:
a company department which generates revenue or which acquires, distributes or manufactures material. Contrast staff department (qv).

Line Side Stocks:
Commonly used C-Class items issued to the shop floor for general use and replenished by the 2-bin system. Also known as floor stocks.

Line Stopper:
A heart-felt term for a stocked item, whether a production component or a machine spare, which is essential for the continuation of production and which has a very long replenishment leadtime. The line stopper is usually inexpensive, stocked in small quantities and replenished at infrequent intervals. Since line stoppers are almost always "Cl...

Linear Exponential Smoothing:
(Double Exponential Smoothing) A refinement of single exponential smoothing especially applicable when there is an upwards or downwards trend in the time-series. If a moving average lags behind the original data because of trend in the data (and the trend is linear), it is possible to take a further moving average of the moving average already tak...

linear loss function
, and is encountered only in calulations involving safety stock.

Linear Loss Function:
A term that has been used for the Partial Expectation, qv.

Linear Programming:
See Mathematical Programming.

Liquidated Damages (legal):
A buyer may insert into a contract a stipulation that if some specified activity required of the supplier is not, in fact, performed, then the supplier will pay a certain sum to the buyer as recompense. For example, "delivery of the goods is to be made on the 15th, and the supplier will pay liquidated damages of

Liquidity Ratio:
the ratio of (current assets less stock)/current liabilities.

Little's Law:
Manufacturing Process Leadtime = (Number of Items in Process) / (Number of Item Completions per Hour).

Live Storage:
Roll through storage systems typically based on chutes or metal rollers. Additional productivity is associated with live storage (as opposed to static storage), and is obtained at very little cost Visit www.live-storage.com.

Live/die 50:50:
See LD50.

LLP:
Limited liabilty partnership (also see Ltd )

LLU:
Local Loop Unbundling.

LMDS:
Local Multi-Point Distribution System.

LME (London Metal Exchange):
The market in the City of London for buying and selling non-ferrous metals and metal futures. The LME is the largest non-iron market in the world. It trades in US dollars and dealing is still (2007) done by "open outcry" rather than by way of computer.

LNA:
Local Noise Amplifier.

Load Factor:
A decimal fraction calculated as follows: (demonstrated capacity) / (available hours). Thus if the demonstrated capacity of a work centre is 80 hours and the available hours is only 60 hours, the load factor is 1.33 (80/60).

Load:
When applied to capacity planning, the total amount of work standing at a work centre waiting to be processed. (The figure is usually expressed in hours.)

Loading Bay:
The area of a stores or warehouse which receives the vehicles and goods of suppliers of raw materials or from which vehicles and goods are despatched to customers - where the stores meets the outside world. Critical issues are side loading of vehicles (speed of access) v. end-loading (economy of parking, temperature control and safety); safety; te...

Local Delivery:
In the context of distribution, the conveyance of relatively small loads from a depot or DC to customers' premises. Issues in local delivery are likely to include tailoring the delivery service to the varying requirements of customers (eg as to timing), rather than load efficiency. See also Trunking.

Location of Distribution Depots:
When a distribution facility is established at a particular location within the area covered by a distribution network (qv), it is desirable that it should be located at the optimum point. "Optimum" is usually taken to mean the point at which least cost is incurred in servicing the customers who are to be supplied by the facility (althou...

Logistics:
The art of moving and quartering troops, and associated supplies - ie a quarter-master's work. (OED). Logistics now means what distribution used to mean in the 1960s - ie the calculation of needed external supplies and the arrangement for their receipt and replenishment, and the determination of channels of supply and communication.

LOLER regulations:
. The Lifting Operations and Lifting Equipment Regulations 1998. These state that all lifting equipment (including fork lift trucks, tail lifts on road transport etc.) should be thoroughly examined at least every 12 months (or every 6 months if the lifts are employed in lifting people or if it is a lifting attachment). As well, examination should b...

London Fox:
London Futures and Options Exchange. The market in the City of London dealing in coffee, tea, cocoa, sugar and other similar commodities.

Longitudinal Analysis:
examination of the performance of a company over a period of many years, in order to pinpoint significant changes that have occurred and determine the causes of them.

Loop (in Production):
Each component and raw material constituting a bill of materials of a product will occur only once in that bill. That is, P is made from Q, Q from R, R from S etc.. Technically, however, it is possible for a component to appear more than once: P made from Q, Q from R, R from Q ... An example is the use of oxide to coat video tape, and the later rec...

Loss to Society:
For the engineer or manufacturer regarding the quality of a product, there are strict limits limits defined by tolerance dimensions. Within the limits, there is quality; outside them, there is not. For the consumer, said Taguchi (qv), there are no such cut-off points. While he certainly seeks a level of quality within the targets of manufacture, h...

Lot for Lot (L4L:
The manufacture of precisely the number of units required to satisfy net requirements, rather than the manufacture of a standard lot size (which may be more than the number required).