Tact Time
See Takt Time

Tactical Planning
The process of developing a set of tactical plans (e.g., production plan, sales plan, marketing plan, and so on). Two approaches to tactical planning exist for linking tactical plans to strategic plans–production planning and sales and operations planning. See: Sales and operational planning, strategic planning.

Tag Number
The number used in the hospitality commerce to identify a specific product that is related to the blueprints or layout plans. Required for maintaining accurate and updated inventory process.

Taguchi Method
A concept of off-line quality control methods conducted at the product and process design stages in the product development cycle. This concept, expressed by Genichi Taguchi, encompasses three phases of product design: system design, parameter design, and tolerance design. The goal is to reduce quality loss by reducing the variability of the product’s characteristics during the parameter phase of product development.

Takt Time
Sets the pace of production to match the rate of customer demand and becomes the heartbeat of any lean production system. It is computed as the available production time divided by the rate of customer demand. For example, assume demand is 10,000 units per month, or 500 units per day, and planned available capacity is 420 minutes per day. The takt time = 420 minutes per day/ 500 units per day = 0.84 minutes per unit. This takt time means that a unit should be planned to exit the production system on average every 0.84 minutes.

Tally sheet
A printed form on which companies record, by making an appropriate mark, the number of items they receive or ship. In many operations, tally sheets become a part of the permanent inventory records.

Tandem
A truck that has two drive axles or a trailer that has two axles.

Tank cars
Rail cars that are designed to haul bulk liquids or gas commodities.

Tapering rate
A rate that increases with distance but not in direct proportion to the distance the commodity is shipped.

Tare Weight
The weight of a substance, obtained by deducting the weight of the empty container from the gross weight of the full container.

Target Costing
A target cost is calculated by subtracting a desired profit margin from an estimated or a market-based price to arrive at a desired production, engineering, or marketing cost. This may not be the initial production cost, but one expected to be achieved during the mature production stage. Target costing is a method used in the analysis of product design that involves estimating a target cost and then designing the product/service to meet that cost. Also see: Value Analysis

Tariff
Schedule of transportation costs.

Task interleaving
A method of combining warehouse picking and putaway. Warehouse Management Systems (WMS) use logic to direct a lift truck operator to put away a pallet en route to the next pick.

Tasks
The breakdown of the work in an activity into smaller elements.

TCO
see Total Cost of Ownership

Technical Components
Component (part) of a product for which there is a limited number of suppliers. These parts are hard to make, and require much more lead time and expertise on the part of the supplier to produce than standard components do.

Temporary authority
The ICC may grant a temporary operating authority as a common carrier for up to 270 days.

Ten Principles
‘A principle is a general rule, fundamental, or other statement of an observed truth. Over time certain fundamental truths of material handling have been found to exist. The ”principles” of material handling are often useful in analyzing, planning and managing material handling activities and systems. At the very least they form a basic foundation upon which one can begin building expertise in material handling. These principles, that serve as a starting point to identifying potential problems and assessing need, are : Planning, Standardization, Work, Ergonomic, Unit Load, Space Utilization, System, Automation, Environment, Life Cycle Cost’

Tender
The document which describes a business transaction to be performed.

Term Contracting
Establishing a source from which to acquire goods or services for a specific period of time.

Terminal delivery allowance
A reduced rate offered in return for the shipper of consignee tendering or picking up the freight at the carrier’s terminal

Terms and conditions
All the provisions and agreements of a contract.

Testing (Commodities)
To perform a laboratory analysis of products purchased from a contract to determine if the quality and performance agreed to by the contractor remains in compliance.

TEU
see Twenty-foot Equivalent Unit

Theoretical Cycle Time
The back-to-back process time required for a single unit to complete all stages of a process without waiting, stoppage, or time lost due to error.

Theory of Constraints
A production management theory which dictates that volume is controlled by a series of constraints related to work center capacity, component availability, finance, etc. Total throughput cannot exceed the capacity of the smallest constraint, and any inventory buffers or excess capacity at non-related work centers is waste.

Third Party Logistics Provider
A firm that provides one or multiple logistic related services for use by customers. They can facilitate the movement of parts and materials from suppliers to manufacturers, and finished products from manufacturers, and finished products from manufacturers to distributors and retailers. Among the services they provide are transportation, warehousing, receiving, cross docking, inventory management, packaging, and freight forwarding.

Third-Party Warehousing
The outsourcing of the warehousing function by the seller of the goods.

Three-layer framework
A basic structure and operational activity of a company, the three layers include operational systems, control and administrative management, and master planning.

Threshold
A pick-up or delivery service to the door only. No unpacking or placement of goods is performed.

Throughput
A measure of warehousing output volume (weight, number of units). Also, the total amount of units received plus the total amount of units shipped, divided by two.

Tier
A single layer of units forming part of a unit load, column, stack row or block.

Time Based Order System
See Fixed Reorder Cycle Inventory Model

Time Bucket
A number of days of data summarized into a columnar display. A weekly time bucket would contain all of the relevant data for an entire week. Weekly time buckets are considered to be the largest possible (at least in the near and medium term) to permit effective MRP.

Time Fence
A policy or guideline established to note where various restrictions or changes in operating procedures take place. For example, changes to the master production schedule can be accomplished easily beyond the cumulative lead time, while changes inside the cumulative lead time become increasingly more difficult to a point where changes should be resisted. Time fences can be used to define these points.

Time utility
A value created in a product by having the product available at the time desired. Transportation and warehousing create time utility.

Time/service rate
A rail rate that is based upon transit time.

Time-Definite Services
Delivery is guaranteed on a specific day or at a certain time of the day.

Time-Stop
An additional service for product that requires a specific pick-up or delivery date and or time.

Timetables
Time schedules of departures and arrivals by origin and destination, typically used for passenger transportation by air, bus, and rail.

Time-to-Product
The total time required to receive, fill, and deliver an order for an existing product to a customer, timed from the moment that the customer places the order until the customer receives the product.

TL
see Truckload

TMS
see Transportation Management System

TOC
see Theory of Constraints

TOFC
see Trailer on a Flatcar

Ton-mile
A measure of output for freight transportation, it reflects the weight of the shipment and the distance it is hauled, a multiplication of tons hauled and distance traveled.

Total Annual Material Receipts
The dollar amount associated with all direct materials received from Jan 1 to Dec 31.

Total Annual Sales
Total Annual Sales are Total Product Revenue plus post-delivery revenues (e.g., maintenance and repair of equipment, system integration) royalties, sales of other services, spare parts revenue, and rental/lease revenues.

Total Average Inventory
Average normal use stock, plus average lead stock, plus safety stock.

Total Cost Analysis
A decision-making approach that considers minimization of total costs and recognizes the interrelationship among system variables such as transportation, warehousing, inventory, and customer service.

Total Cost Curve
(1) In cost-volume-profit (breakeven) analysis, the total cost curve is composed of total fixed and variable costs per unit multiplied by the number of units provided. Breakeven quantity occurs where the total cost curve and total sales revenue curve intersect. See: Break-even chart, Break-even point.(2) In inventory theory, the total cost curve for an inventory item is the sum of the costs of acquiring and carrying the item. Also see: Economic Order Quantity

Total Cost of Ownership
Total cost of a computer asset throughout its lifecycle, from acquisition to disposal. TCO is the combined hard and soft costs of owning networked information assets. ‘Hard’ costs include items such as the purchase price of the asset, implementation fees, upgrades, maintenance contracts, support contracts, and disposal costs, license fees that may or may not be upfront or charged annually. These costs are considered ‘hard costs’ because they are tangible and easily accounted for.

Total Cumulative Manufacture Cycle Time
The average time between commencement of upstream processing and completion of final packaging for shipment operations as well as release approval for shipment. Do not include WIP storage time. Calculation: [Average

Total Inventory Days of Supply
Total gross value of inventory at standard cost before reserves for excess and obsolescence. Includes only inventory that is on the books and currently owned by the business entity. Future liabilities such as consignments from suppliers are not included. Calculation: [5 Point Annual Average Gross Inventory] / [Cost of Good Sold/365]

Total Make Cycle Time
The average total processing time between commencement of upstream processing and completion of all manufacturing process steps up to, but NOT including, packaging and labeling operations (i.e. from start of manufacturing to final formulated product ready for primary packaging). Do not include hold or test and release times. Calculation: [Average

Total Package and Label Cycle Time
The average total processing time between the commencement of the primary packaging and labeling steps to completion of the final packaging steps for shipment. Calculation: [Average

Total Product Revenue
The total value of sales made to external customers plus the transfer price valuation of intra-company shipments, net of all discounts, coupons, allowances, and rebates. Includes only the intra-company revenue for product transferring out of an entity, installation services if these services are sold bundled with end products, and recognized leases to customers initiated during the same period as revenue shipments, with revenue credited at the average selling price. Note: Total Product Revenue excludes post-delivery revenues (maintenance and repair of equipment, system integration), royalties, sales of other services, spare parts revenue, and rental/lease revenues.

Total Productive Maintenance
Team based maintenance process designed to maximize machine availability and performance and product quality.

Total quality management
A management approach in which managers constantly communicate with organizational stakeholders to emphasize the importance of continuous quality improvement.

Total Sourcing Lead Time
Cumulative lead time (total average combined inside-plant planning, supplier lead time [external or internal], receiving, handling, etc., from demand identification at the factory until the materials are available in the production facility) required to source 95% of the dollar value (per unit) of raw materials from internal and external suppliers.

Total Supply Chain Response Time
The time it takes to rebalance the entire supply chain after determining a change in market demand. Also, a measure of a supply chain’s ability to change rapidly in response to marketplace changes. Calculation: [Forecast Cycle Time] + [Re-plan Cycle Time] + [Intra-Manufacturing Re-plan Cycle Time] + [Cumulative Source/Make Cycle Time] + [Order Fulfillment Lead Time]

Total Supply-Chain Management Cost
Total cost to manage order processing, acquire materials, manage inventory, and manage supply-chain finance, planning, and IT costs, as represented as a percent of revenue. Accurate assignment of IT-related cost is challenging. It can be done using Activity-Based-Costing methods, or based on more traditional approaches. Allocation based on user counts, transaction counts, or departmental headcounts are reasonable approaches. The emphasis should be on capturing all costs, whether incurred in the entity completing the survey or incurred in a supporting organization on behalf of the entity. Reasonable estimates founded in data were accepted as a means to assess overall performance. All estimates reflected fully burdened actuals inclusive of salary, benefits, space and facilities, and general and administrative allocations. Calculation: [Order Management Costs + Material Acquisition Costs + Inventory Carrying Costs + Supply-Chain-Related Finance and Planning Costs + Total Supply-Chain-Related IT Costs] / [Total Product Revenue] (Please see individual component categories for component detail and calculations)

Total Test and Release Cycle Time
The average total test and release time for all tests, documentation reviews, and batch approval processes performed from start of manufacturing to release of final packaged product for shipment. Calculation: [Average

Toto authority
A private motor carrier receiving operating authority as a common carrier to haul freight for the public over the private carrier’s backhaul, this type of authority was granted to the Toto Company in 1978

Touch Labor
The labor that adds value to the product - assemblers, welders etc. This does not include indirect resources such as material handlers (mover and stage product, mechanical and electrical technicians responsible for maintaining equipment.

TPM
see Total Productive Maintenance

TQM
see Total quality management

Traceability
(1) The attribute allowing the ongoing location of a shipment to be determined. (2) The registering and tracking of parts, processes, and materials used in production, by lot or serial number.

Tracing
(1) Determining where a shipment is during the course of a move. (2) The practice of relating resources, activities and cost objects using the drivers underlying their cost causal relationships. The purpose of tracing is to observe and understand how costs are arising in the normal course of business operations. Synonym: Assignment.

Tracking and Tracing
Monitoring and recording shipment movements from origin to destination.

Tracking Signal
The ratio of the cumulative algebraic sum of the deviations between the forecasts and the actual values to the mean absolute deviation. Used to signal when the validity of the forecasting model might be in doubt.

Tractor
Motor truck for towing a trailer.

Trademark
A symbol, initialing, lettering, etc., which has been adopted as a positive identification of a supplier. A trademark, to be valid, must be properly registered with legal rights assigned to only one user.

Trading Partner
Companies that do business with each other via EDI (e.g., send and receive business documents, such as purchase orders).

Trading Partner Agreement
The written contract that spells out agreed upon terms between EDI trading partners.

Trading partners
Organizations a company does business with.

Traffic
A department or function charged with the responsibility for arranging the most economic classification and method of shipment for both incoming and outgoing materials and products.

Traffic Management
The management and controlling of transportation modes, carriers and services.

Trailer
Container to haul commodities that is mounted on wheels and pulled by a tractor.

Trailer Drops
When a driver drops off a full truck at a warehouse and picks up an empty one. See Drop.

Trailer on a Flatcar
A specialized form of containerization in which motor and rail transport coordinate. Synonym: Piggyback.

Tramp
An international water carrier that has no fixed route or published schedule, a tramp ship is chartered for a particular voyage or a given time period.

Transaction
A single completed transmission, e.g., transmission of an invoice over an EDI network. Analogous to usage of the term in data processing, in which a transaction can be an inquiry or a range of updates and trading transactions. The definition is important for EDI service operators, who must interpret invoices and other documents.

Transaction Set
Commonly used business transactions (e.g. purchase order, invoice, etc.) organized in a formal, structured manner, consisting of a Transaction Set header control segment, one or more Data Segments, and a Transaction Set trailer Control Data Segment.

Transaction Set ID
A three digit numerical representation that identifies a transaction set.

Transactional Acknowledgement
Specific Transaction Sets, such as the Purchase Order Acknowledgement (855), that both acknowledges receipt of an order and provides special status information such as reschedules, price changes, back order situation, etc.

Transfer Pricing
The pricing of goods or services transferred from one segment of a business to another. Transfer pricing generally includes the costs associated with performing the transfer and therefore item costs will be incrementally higher than when received through normal channels.

Transit Inventory
Inventory in transit between manufacturing and stocking locations, or between warehouses in a distributed warehousing model. Also see: In-transit Inventory

Transit privilege
A carrier service that permits the shipper to stop the shipment in transit to perform a function that changes the commodity’s physical characteristics, but to pay the through rate.

Transit time
The total time that elapses from pickup to delivery of a shipment.

Translation Software
‘Software the converts or ”translates” business application data into EDI standard formats, and vice versa.’

Transmission Acknowledgment
Acknowledgment that a total transmission was received with no errors detected

Transparency
The ability to gain access to information without regard to the systems landscape or architecture. An example would be where an online customer could access a vendor’s web site to place an order and receive availability information supplied by a third party outsourced manufacturer or shipment information from a third party logistics provider. See also: Visibility

Transportation
The movement of goods by method of rail, ocean, air, truck and/or pipeline.

Transportation Association of America
An association that represents the entire U.S. transportation system–carriers, users, and the public, now defunct.

Transportation Management System
A computer program designed to provide optimized transportation management in various modes along with associated activities, including managed shipping units, labor planning and building, scheduling through inbound, outbound, intra-company shipments, documentation management, and third party logistics management. ##

Transportation method
A linear programming technique that determines the least-cost allocation of shipping goods from plants to warehouses of from warehouses to customers.

Transportation Mode
The method of transportation: rail, ocean, air, truck and pipeline.

Transportation Planning
The process of defining an integrated supply chain transportation plan and maintaining the information that characterize total supply chain transportation requirements, and the management of transporters.

Transportation Planning Systems
‘The systems used in optimizing of assignments from plants to distribution centers, and from distribution centers to stores. The systems combine ”moves” to ensure the most economical means are employed. ‘

Transportation Requirements Pplanning
Utilizing computer technology and information already available in MRP and DRP databases to plan transportation needs based on field demand.

Transportation Research Board
A division of the National Academy of Sciences which pertains to transportation research.

Transportation Research Forum
A professional association that provides a forum for the discussion of transportation ideas and research techniques.

Transshipment problem
A variation of the transportation method of linear programming that considers consolidating shipments to one destination and reshipping from that destination.

Travel agent
A firm that provides passenger travel information, air, rail, and steamship ticketing, and hotel reservations. The travel agent is paid a commission by the carrier and hotel.

Trend
General upward or downward movement of a variable over time such as demand for a product. Trends are used in forecasting to help anticipate changes in consumption over time.

Trend Forecasting Models
Methods for forecasting sales data when a definite upward or downward pattern exists. Models include double exponential smoothing, regression, and triple smoothing.

TRP
see Transportation requirements planning

Truckload
A shipment of freight that is loaded to a trailers maximum capacity either by bulk or maximum weight.

Truckload Lot
A truck shipment that qualifies for a lower freight rate because it meets a minimum weight and/or volume.

Trunk lines
Oil pipelines that are used for the long-distance movement of crude oil, refined oil, or other liquid products.

T’s & C’s
see Terms and conditions

Turnaround
In water transportation, the time it takes between the arrival of a vessel and its departure.

Turnaround Time
The length of time for completing a process usually expressed as an average but can be determined for individual items (i.e. time from placing requisition to issue of goods or time from requisition to issuance of a P.O.).

Turnover
(1) Typically refers to Inventory Turnover.(2) In the United Kingdom and certain other countries, turnover refers to annual sales volume. Also see: Inventory Turns

Twenty-foot Equivalent Unit
Standard unit for counting containers of various capacities and for describing the capacities of container ships or terminals. One 20 Foot ISO container equals 1 TEU. One 40 Foot ISO container equals two TEU.

Two-bin system
An inventory ordering system in which the time to place an order for an item is indicated when the first bin is empty. The second bin contains sufficient supply until the order is received.

Two-Level Master Schedule
A master scheduling approach in which a planning bill of material is used to master schedule an end product or family, along with selected key features (options and accessories). Also see: Production Forecast

Time compression
In its most bsaic form it relates to the reduction of time consumed by business processes through the elimination of non-value-adding process time.

TC
See Time Compression