MYOB Advanced Manufacturing

Manufacturing Terminology Dictionary

These terms and acronyms are commonly used throughout the manufacturing industry and MYOB Advanced Manufacturing.

Assemble to order (ATO)

Assemble-to-order (ATO) is a business production strategy where products that are ordered by customers are produced quickly and are customisable to a certain extent. This often requires that the basic parts of the product are already manufactured but not yet assembled.

Available-to-Promise (ATP)

ATP is a business function that provides a response to customer order inquiries, based on resource availability. It generates available quantities of the requested product, and delivery due dates. Therefore, ATP supports order promising and fulfillment, aiming to manage demand and match it to production plans.

Backflushing

The concept of updating component inventory balances automatically when finished goods are in the process of production.

Bill-of-Materials (BOM)

Bill of Materials (BoM) – the complete list of all the materials and parts that a manufacturer needs to create a certain product.

Configure-to-order (CTO)

Configure-to-Order (CTO) is a manufacturing process based on design selection at the time of order. A CTO process uses customer requirements, picked from a set of product features with pre-defined possible values, to select a combination of parts and assemblies to make a specific pre-defined, pre-engineered, pre-validated variant of a product.

Cumulative Lead Time

The longest planned length of time to accomplish the activity in question. It is found by reviewing the lead time for each bill of material path below the finished item; whichever path adds up to the greatest number defines cumulative lead time.

Discrete Manufacturing

Discrete manufacturing is an industry term for the manufacturing of finished products that are distinct items capable of being easily counted, touched, or seen. Discrete manufacturing involves parts and systems like nuts and bolts, brackets, wires, assemblies, and individual products. Examples of products made from discrete manufacturing include automobiles, furniture, airplanes, toys, smartphones and defence systems. In theory, a discrete product can be broken down at the end of its lifecycle so its basic components can be recycled.

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Engineer Change Order/Request (ECO/ECR)

Engineer Change Orders (ECO’s) are a revision to a drawing or design released by engineering to modify or correct a part via a Bill of Material (BoM). Engineer Change Requests (ECR’s) for change can be initiated by the customer, from production, quality control or any other department.

Make-to-order (MTO)

Make to order (MTO), or made to order, is a manufacturing production strategy that typically allows consumers to purchase products that are customised to their specifications. It’s a manufacturing process in which the production of an item begins only after a confirmed customer order is received.

Make-to-stock (MTS)

Make-to-stock (MTS) is a manufacturing strategy in which production planning and production scheduling are based on forecasted product demand. Products made during one production period are used to fulfill orders made in the next production period. This means that in make-to-stock production planning, production is triggered prior to and independent of specific customer orders.

Master Production Scheduling (MPS)

The Master Production Schedule (MPS) is the disaggregated version of the sales and operations plan. That is, it states which end items or product options manufacturing will build in the future.

Phantom Bill of Material

A Bill-of-Material (BoM) structuring technique used primarily for transient (non-stocked) subassemblies. A phantom BoM represents an item that is physically built but rarely stocked before being used in the next step or operation in manufacturing a finished good.

Process Manufacturing

Process manufacturing is a production method that uses formulas or recipes to produce goods by combining ingredients or raw materials. It’s commonly used in industries that produce bulk quantities of goods, such as food, beverage, chemical, and pharmaceutical.

Production Planning

A process to develop tactical plans based on setting the overall level of manufacturing output and other activities to best satisfy the current planned levels of sales while meeting the general business objectives of profitability, productivity, competitive customer lead times etc. expressed in the overall business plan.

Project based Manufacturing

Delivered within a project framework it’s a process used for large, often unique items or structures that require a custom design capability (engineer-to-order (ETO) ) and a process that is highly flexible and caters for a high degree of product changes and product designs.

Work Centre

A specific production area consisting of one or more people and/or machines with similar capabilities that can be considered one unit for the purpose of capacity requirements planning and detailed scheduling.