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| E/I transducer |
A device that linearly converts a voltage signal into a current signal. |
| earliest start date |
The earliest date an operation or project task can begin due to process constraints or material availability dictated by a previous task or operation. |
| earned hours |
Labor or machine hours calculated by multiplying standard hourly rates by actual production for a given period. Earned hours are compared to actual hours to identify efficiency variances. |
| earnings before interest, taxes, depreciation and amortization (EBITDA) |
A cash flow measurement that excludes interest, taxes, depreciation and amortization, often used in buyout or public offering instances as opposed to ongoing financial business performance. |
| EC |
European Community |
| e-commerce |
A general term for conducting business and consumer marketing, product information, ordering and payment functions over the Internet instead of using traditional methods. Product delivery still requires physical capabilities unless the product or service can be fulfilled using strictly electronic means (as in the download of software code). |
| economic order quantity (EOQ) |
A lot size model that attempts to balance the costs associated with placing individual orders with the costs of carrying inventory. Defined as the square root of: 2 X annual demand X ordering cost divided by inventory carrying cost (as a %) x unit cost. |
| economic value added (EVA)® |
A financial performance measurement developed by Stern Stewart & Company that gauges the creation of shareholder wealth, and evaluates tradeoffs in opportunity costs, by determining net operating profit after taxes minus (capital times the cost of capital). |
| economies of scale |
Cost savings in production, purchasing or support functions realized by combining organizations and achieving higher volumes. |
| effect |
That which was produced by a cause. |
| effectiveness |
The level to which an activity or product is able to satisfy perceived requirements, which compares benefits derived to costs incurred. |
| effectivity date |
The planned date for component changes to be made to a bill of material or operation changes to a routing. Planning, scheduling and costing systems consider effectivity dates when projecting material requirements, loading plant work centers or performing cost rolls. |
| efficacy |
(see effectiveness) |
| efficiency |
Relationship between the result achieved and the resources used. A performance measurement that tracks actual vs. expected resource usage for a given volume or output. If labor costs for a given period are higher than expected, it could be due to: 1) a labor efficiency variance caused by using more labor hours for the amount of units produced than the standard or expected hours, or 2) a labor rate variance caused by using a more highly-paid group of workers than the standard. |
| EFTA |
European Free Trade Association |
| elapsed time |
The actual time between starting and ending an activity. Labor and machine time entries are typically made either by directly entering an elapsed time, or by entering the start and end times and having the system calculate the elapsed time. |
| electronic data interchange (EDI) |
The electronic transfer of order and transfer information between trading partners on the same system, that uses a predefined, standard message format for order receipt, order release, advanced shipping notifications, invoices and other transactions. |
| electronic data interchange for administration, commerce, transport (EDIFACT) |
United Nations-sponsored syntax rules for EDI message exchange. |
| electronic design automation (EDA) |
Software and hardware systems specifically created to enable the automatic design of electronic products. |
| electronic funds transfer (EFT) |
Electronic systems that transmit standardized financial data, payments and other transactions between connected parties and do not use paper documents to increment or decrement accounts. |
| elements of work |
The elements of work are 1) value-added work, 2) non value-added work, and 3) waste. Thoroughly understanding the elements of work is a key first step to lean thinking. |
| EN |
European Standard |
| end item |
A top level or finished item that is not a component of other items. |
| end user |
The final consumer of a product or service that ultimately determines its acceptability. |
| ending inventory |
The book or perpetual inventory at the end of an accounting period, often calculated as beginning inventory + receipts - issues ± adjustments. |
| endogenous variable |
A variable caused by one or more variables contained within the model being evaluated. |
| engineer to order (ETO) |
A manufacturing response to demand in which engineering analysis and design occurs for all materials and production activities designated for a specific customer order. ETO may involve the use of a few common raw materials, but requires constructing new bills of materials and routings to complete intermediate items and the end time required. |
| engineering change order (ECO) |
A formal document that has been signed off by the affected departments and authorizes product definition changes to a drawing, bill of material or routing. It often ties to system planning, scheduling and cost functions by specifying an effectivity date for the items included. |
| engineering change request |
A document requesting a revision or change to a product or process that optimally includes the reason, urgency level, items and processes affected, and cost/benefit of the change. Signoff by a review board is normally required before the change is enacted. |
| engineering change review board |
A cross-functional team that analyzes proposed engineering changes for approval or rejection. It normally includes representation from engineering, operations, purchasing, planning, cost accounting and vendors or customers as required and its members are able to evaluate timing and cost/benefit considerations. |
| enterprise resource planning (ERP) |
An enterprise-wide system that extends manufacturing resource planning (MRP II) by incorporating all system and organizational functions required to plan and support manufacturing, finance, distribution/logistics and additional areas such as engineering, maintenance, etc. It serves as the base repository for cross-functional data and defines a common usage of technology. |
| enterprise system |
A system that supports enterprise-wide or cross-functional requirements, rather than a single department or group within the organization. |
| EQS |
European Committee for Quality System Assessment and Certification |
| equivalent units |
1) The conversion to a base unit for items with multiple units of measure (ex.- the conversion to units of an item also specified in dollars, cases, pounds, pallets or other measurements). 2) The conversion of partially-completed units into an equivalent number of finished units. |
| ETSI |
European Telecommunications Standards Institute |
| European Article Number (EAN) |
A superset of the Universal Product Code that includes the base UPC code and two or three additional characters that indicate the country that issued the number (not necessarily the country of origin for that product). |
| evaporating cloud |
A conflict resolution tool used in the theory of constraints to identify assumptions related to a problem, create actions to solve or invalidate the assumptions and as a result resolve, or evaporate, the problem. Same as Conflict Resolution. |
| event management |
The process in a supply chain or other system used to define, prevent or detect, identify and communicate with partners, propose resolution and follow-up situations that threaten to disrupt the flow of data, goods or services. Considered a proactive approach based on prediction and prevention, as compared to standard exception reporting systems. |
| every part every |
Measured in terms of time (hours, days, weeks, months, etc.) “Every Product Every X” indicates the level of flexibility to produce whatever the customer needs. For instance, Every Product Every day would indicate that changeovers for all products required can be performed each day and the products can be supplied to the customer. |
| exception message |
A system-generated notification of an order, inventory or other condition that violates defined parameters and requires a response. Messages include indications for past due, cancellation, order quantity changes, order date changes, inventory below safety stock level, and many other conditions. Systems that use auto-rescheduling use exception messages to initiate automatic action, without manual review and intervention by a planner. |
| excess inventory |
Any inventory above the minimum manually-specified or system-calculated level required to support production and distribution operations. Excess inventory definitions may include any inventory above zero, above a defined safety stock level, or over a defined number of days supply. |
| execution sequence number |
The order in which the controller executes function blocks. |
| execution |
The systems and functions that fulfill planned activities, such as production against work orders or the shipment of requirements to supply chain partners. The 'actual' that measures the success of the plan. |
| executive sponsor |
An executive-level manager who interacts with the project team leader and acts as liaison with other executive staff members in taking high-level responsibility to champion, guide, and monitor a given project. |
| exogenous variable |
A variable caused by one or more variables not contained within the given model. |
| expedite |
To raise the priority level on a production or purchase order due to a past due condition or a change in the requirement date that necessitates compressing the normal lead time. |
| experiment |
A test under defined conditions to determine an unknown effect; to illustrate or verify a known law; to test or establish a hypothesis. |
| experimental error |
Variation in observations made under identical test conditions. Also called residual error. The amount of variation which cannot be attributed to the variables included in the experiment. |
| exponential smoothing |
A technique used in forecasting models that assigns different weights to past demand periods, instead of considering each one equally. A simple moving average technique takes the total demand for the last 'X' number of demand periods and divides by 'X' to get the average period demand- each period is treated the same. By contrast, in exponential smoothing a smoothing (alpha) factor (ex.- 0.1) is multiplied by the demand from the last period, and 0.9 is multiplied by the calculated average period demand for periods prior to the last, thus assigning a different weight to the last period. Raising the alpha factor gives more weight or emphasis to demand from the most recent period. |
| external setup |
Activities that setup or prepare production equipment for the next job while the equipment is still processing the current job. External activities avoid setup downtime, as opposed to internal setup activities that require the equipment to be idle. Moving set-up activities from internal to external in order to reduce machine down time is a central activity of set-up reduction and SMED. Also called OED - "outer exchange of die" |
| extrinsic forecast |
A forecast tied to a linked indicator outside the company instead of using internal past product demand history. It normally uses a leading indicator such as housing starts or weather pattern changes that have been demonstrated in the past to have a predictive effect on the company's demand. |
