Glossary

 

Overview

Welcome to our glossary page, providing concise explanations for key terms in the realms of supply chain management, forecasting, and analytics. Whether you're navigating the complexities of demand planning, exploring the intricacies of algorithms and machine learning, or delving into inventory optimization strategies, this glossary serves as a valuable resource.

Each term is presented alphabetically, offering not only definitions but also additional insights to enhance your understanding. From fundamental concepts like Aggregate Forecast and Algorithm to advanced definitions like WMAPE, our glossary offers additional insights to enhance your understanding. We'll present Intuendi terminology alongside more generic terms.

 

Glossary A

Aggregate Forecast

A demand or sales forecast for a group of products or customers. It provides an overview without specific details on individual items, offering insights into the overall volume for product families or customer segments.

Algorithm

A computational procedure used to solve problems or derive outcomes through a well-defined sequence of steps. Algorithms are fundamental in various fields, driving advancements in technology and problem-solving methodologies.

Analytics

A field of computer science utilizing mathematics, statistics, and machine learning to discern meaningful patterns in data. Analytics enables informed decision-making by extracting valuable insights from complex datasets.

Attribute

A feature, property or characteristic usually useful to group subsets of products, regions, locations or suppliers in Intuendi. 

Average Value

One of the most common measures of central tendency in a dataset, particularly the arithmetic mean. It provides a representative value that summarizes the overall distribution of data.

 

Glossary B

Benchmarking

A common practice where a company seeks to enhance internal processes by studying the best practices of other companies or industry standards. Benchmarking serves as a valuable tool for continuous improvement.

Bill of Materials (BOM)
A comprehensive list detailing the parts or components necessary for constructing or producing a product. The BOM is crucial for manufacturing and assembly processes, ensuring all required elements are accounted for.

Bottom-up Forecasting

A forecasting methodology that begins at lower levels, such as individual SKUs, and aggregates upward to higher levels like categories or brands. It offers a detailed perspective before forming an aggregate forecast.

Breakdown

Usually a division of something into smaller parts. You can use breakdowns in Intuendi to slice sales and forecast data into smaller aggregation levels. A breakdown could be the following one:

Category → Product → Region

This breakdown lets you navigate data through categories first, then through products, each belonging to a specific category and finally down to regions or channels.

Breakdown Path

A breakdown path is a specific path in a given breakdown. For instance, given the following breakdown:

Category → Product → Region

examples of breakdown paths could be the following:

• Category: Accessories
• Category: Accessories → Product: Belt
• Category: Accessories → Product: Belt → Region: US

As you can see, a breakdown path has the option to stop at an intermediate level, without extending to the final level (such as the Region in this example).

Budget Optimization

A technique determining the most effective allocation of a given budget among multiple options, prioritizing optimal performance. Budget optimization aids in resource management and achieving desired outcomes efficiently.

 

Glossary C

Causal Factor

A Causal Factor in demand forecasting refers to an external or internal variable that is believed to have a direct influence on the observed time series data. These factors are considered potential drivers that can impact the trend, seasonality, or overall behavior of the time series, providing valuable information for improving the accuracy of forecasts.

Confidence Level

The probability that the value of a parameter falls within a specified range. Confidence levels provide a statistical measure of the reliability of predictions or estimates like the forecasts you'll find in Intuendi.

Consumer Demand Driven

The demand propelled by end-consumers, often reflected in Point-of-Sale (POS) data. Understanding consumer demand is vital for tailoring strategies to meet market needs.

Consumer Promotions

Marketing strategies aimed at increasing sales or enhancing brand awareness. Consumer promotions involve various tactics to attract and engage customers, fostering brand loyalty.

Container Optimization

An optimization technique determining the optimal inventory quantity and types to maximize container fulfillment while minimizing freight costs. Container optimization is crucial for efficient logistics and cost-effective shipping.

Cost Performance

A metric evaluating project effectiveness relative to its cost. Cost performance metrics assess the efficiency and value derived from investments in various initiatives.

Coverage (or Target Coverage)

Stock coverage is a logistics metric that shows the period — usually expressed in days — during which a company can meet customer demand with the available inventory in its warehouse. Intuendi's coverage is usually the target days of stock you would like in your warehouses for your products.

 

Glossary D

Dashboard

A software interface providing instant snapshots of key performance indicators (KPIs) and real-time trends. Dashboards facilitate data-driven decision-making by presenting crucial information in a visually accessible format.

Demand Forecasting

A projection of requests for a product or service, distinct from sales forecasts as it considers all potential demand. Accurate demand forecasting supports inventory management and production planning.

Demand Planning

An essential aspect of supply chain planning, offering forecasts for product or service demand. Effective demand planning enhances production and distribution efficiency.

Distribution Center (DC)

A warehouse receiving merchandise from various suppliers and distributing it to multiple locations. Distribution centers play a pivotal role in supply chain logistics.

Distribution Channel

The path goods or services traverse from production to the final consumer or buyer. Proper understanding of distribution channels is critical for effective supply chain management.

 

Glossary E

Enterprise Resource Planning (ERP)

The integrated management of core business processes, facilitated by software. ERP systems collect, store, and interpret data in real-time, aiding organizations in decision-making and resource allocation.

 

Glossary I

Inventory

The complete set of items, goods, merchandise, and materials held by a company for selling in the market. Inventory management is crucial for maintaining optimal stock levels.

Inventory Analysis

The Intuendi process that computes the status of products in each warehouse and the analysis for future replenishment suggestions or stock movements. 

Inventory Performance

An indicator evaluating the effectiveness of actual inventory levels in relation to their costs. Monitoring inventory performance ensures efficient resource utilization.

Inventory Turnover

A quantitative indicator that measures inventory movement by calculating the number of inventory turns. Typically expressed as the ratio between sales and average inventory, inventory turnover offers insights into the efficiency of inventory management.

 

Glossary K

Key Performance Indicators (KPIs)

Metrics used to monitor and control process performance. In forecasting and supply chain management, KPIs include MAPE, WMAPE, customer service level, cost performance, and inventory performance.

 

Glossary L

Latency Time

The interval between initiating and concluding a process. In the supply chain refers to the total duration it takes for a product or material to move from the initiation of the production or procurement process to its availability for use or sale. It encompasses the time required for order placement, processing, manufacturing (if applicable), transportation, and receiving, offering a comprehensive perspective on the temporal aspects of the supply chain.

Lead Time

It is often used interchangeably with Latency Time. It refers to the duration of time required for shipping. It may or may not include the production time, but it can be used as a latency time when no other specific time window (such as production times) is specified in Intuendi.

Location

The Intuendi terminology that refers to warehouses and any other physical or logical place where the stock is kept. It can refer to logical and physical warehouses but also stores.

 

Glossary M

Machine Learning

A branch of artificial intelligence focused on building predictive or prescriptive models based on learning from available data. Machine learning enables systems to improve performance without explicit programming.

MAE (Mean Absolute Error)

A measure of accuracy expressed as a number. It is calculated as the average of absolute errors for each predicted and actual value for demand and sales.

MAPE (Mean Absolute Percentage Error)

A measure of accuracy expressed as a percentage. In forecasting, MAPE assesses the degree of deviation between predicted and actual values.

Minimum Coverage

Minimum coverage acts as a buffer against uncertainties such as supply chain disruptions, supplier delays, or unexpected spikes in demand. It serves as a risk mitigation strategy, safeguarding the supply chain against unforeseen challenges. It can be expressed in days or as a percentage of the target coverage.

Moving Average

The Moving Average Algorithm is a statistical technique used for smoothing time-series data by calculating the average of a set of consecutive data points within a specified window or interval. 

A moving average algorithm can be used with time series data (like sales or demand) to smooth out short-term fluctuations.

 

Glossary N

Numerical Optimization

The field where mathematical techniques are used to minimize or maximize a measure while considering multiple design constraints. Numerical optimization is crucial for efficient resource allocation.

 

Glossary O

Order Lines

Order Lines refer to individual items or products listed within a sales order. A sales order is a document generated by a customer to request the purchase of goods or services from a seller. Each line in the sales order represents a specific product or service along with relevant details such as quantity, price, and specifications.

Out-Of-Stock

The term "Out of Stock" denotes the temporary unavailability of a product due to inventory depletion, with causes ranging from high demand to supply chain disruptions. Effective inventory management and proactive measures are crucial for preventing and mitigating out-of-stock scenarios in retail and distribution channels.

Overstock Risk

Overstock risk refers to the potential negative consequences of maintaining excessive levels of inventory beyond the actual demand or demand forecast within a business or retail setting. These consequences include obsolescence, difficulty in managing warehouse space, and financial liabilities such as potential markdowns or disposal costs. In Intuendi, a product is considered overstocked when the stock held can fulfill more demand than expected in the target coverage period. 

 

Glossary P

Parameter

A physical property whose values determine the characteristics or behavior of something. Parameters play a fundamental role in defining and understanding various systems.

Predictive Analytics

Statistical techniques, including modeling, machine learning, and data mining, analyzing current and historical data to produce accurate forecasts. Predictive analytics aids in anticipating future trends and outcomes.

Prescriptive Analytics

A statistical process utilizing data to determine the most optimal course of action. Prescriptive analytics goes beyond predicting outcomes, providing actionable recommendations.

Production Orders

Production Orders are essential documents in the supply chain that guide and formalize the manufacturing process. They provide a structured framework for producing goods, incorporating details about product specifications, quantities, timelines, and resource requirements.

Purchase Orders

Purchase Orders, also known as POs, are official documents issued by a buyer to a seller, which serve as a legal agreement outlining the specific details of a purchase transaction. In Intuendi, orders issued by the user to the suppliers are referred to as Purchase Orders. These are different from sales orders or order lines, which represent what the user sells to its customers or distributors.

Purchase Price

It's the cost incurred by a business or entity when acquiring goods or services from external suppliers or vendors. This cost encompasses the actual price paid for the products, materials, or services.

 

Glossary R

Rebalancing

In the distribution network, it involves the strategic reallocation of inventory among various locations to optimize stock levels, meet demand effectively, and enhance overall operational efficiency. It is a proactive approach to ensuring the right products are available at the right places, contributing to improved customer service and cost optimization. In Intuendi it refers specifically to stock movement suggestions among locations that are not typically structured hierarchically unlike Transfer Orders.

Region

Intuendi terminology to identify a sales channel, a subset of final customers or a geographical area whose sales are aggregated to gain insights and focus on less granular data.

 

Glossary S

Sales Channel

See Region and Distribution Channel.

Safety Lead Time

An additional time element incorporated into normal lead time to guard against fluctuations. Safety lead time mitigates uncertainties in planning and execution.

Safety Stock

A minimum required level of stock maintained to safeguard against unforeseen variations in demand or lead time. Safety stock acts as a buffer to ensure uninterrupted supply.

Seasonality

A recurring pattern or trend that manifests during different time periods. Recognizing seasonality is crucial for adjusting strategies based on temporal fluctuations.

Selling Price

It represents the monetary value at which a product or service is offered for sale.

Service Level

It represents the probability of meeting customer demand without stockouts or delays, expressed as a percentage. High service levels require larger safety stocks, raising costs, while low levels risk lost sales and dissatisfied customers. Balancing service levels involves analysing demand, lead times, and cost trade-offs to optimise inventory strategy. It reflects a company’s reliability in fulfilling orders, impacting customer satisfaction and brand loyalty.

SKU (Stock Keeping Unit)

An acronym for "Stock Keeping Unit," uniquely identifying individual items in a company's inventory. SKUs facilitate precise inventory tracking and management.

Standard Deviation

A statistical measure expressing the amount of variation or dispersion of a set of values from the mean. Standard deviation provides insights into the spread of data points.

Stock Evolution

The dynamic of changes in the inventory levels over time. It involves fluctuations in stock levels, including additions through purchases and production, as well as deductions through transfers, sales and consumption. 

Supply Chain Planning

A process aiding businesses in ensuring they possess the right amount of goods and services to meet customer demand. Supply chain planning involves forecasting, production organization, and inventory management.

 

Glossary T

Top-Down Forecasting

A forecasting methodology where an aggregate forecast is initially computed and then disaggregated into lower levels. It provides a high-level overview before detailed forecasting at lower levels.

Transfer Orders

Transfer orders refer to instructions or documentation that authorize the movement of goods or materials from one location to another within the distribution network. They typically involve the transfer of inventory between different warehouses, distribution centers, or other internal facilities.

Transferring Time

Transferring times refer to the duration or elapsed time required to move goods, materials, or products from one location to another. 

Trend

The long-term pattern observed in a time series dataset. Trends can exhibit upward, downward, or stable movements, providing valuable insights into the overall behavior of the data and enabling more accurate predictions in time series analysis.

 

Glossary U

Understock Risk

Understock risk in the supply chain arises when inventory levels are insufficient to meet demand, leading to potential operational challenges, customer dissatisfaction, and reputational damage. This risk manifests when inventory falls below optimal levels, leading to out-of-stock events, missed sales opportunities, and potential damage to customer satisfaction and business reputation.

Effective risk mitigation strategies involve proactive demand forecasting, safety stock measures, agile supply chain practices, and collaborative relationships with suppliers.

 

Glossary W

Widget

A widget is typically a graphical element that can be added to or removed from a larger application or interface. Intuendi features dashboard widgets that present key performance indicators (KPIs) or analytics in a visually appealing and accessible manner.

WMAPE (Weighted Mean Absolute Percentage Error)

An acronym for "Weighted Mean Absolute Percentage Error," measuring forecasting accuracy as a percentage with applied weights. WMAPE provides a nuanced evaluation of forecast performance.

Work Orders

See Production Orders.