Tact Time:
See: Takt Time
Tactical Planning:
The process of systematic determination and scheduling of immediate or short-term activities required to achieve the objectives of the organizations strategic plan.
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:
It can be defined as the maximum time per unit to produce a product in order to meet demand. It is derived from the German word “Taktzeit” (cycle time). Takt time sets the pace for industrial manufacturing lines. For example, in automobile manufacturing, cars are assembled on a line and are moved on to the next station after a certain time—the takt time. Therefore, the time needed to complete work on each station has to be less than the takt time in order for the product to be completed within the allotted time.Example: if you have a total of 8 hours (or 480 minutes) in a shift (gross time) less 30 minutes lunch, 30 minutes for breaks (2 x 15 mins), 10 minutes for a team briefing and 10 minutes for basic maintenance checks, then the net Available Time to Work = 480 - 30 - 30 - 10 - 10 = 400 minutes. If customer demand was, say, 400 units a day and you were running one shift, then your line would be required to spend a maximum of one minute to make a part in order to be able to keep up with Customer Demand.
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.
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:
Tare weight, sometimes called unladen weight, is the weight of an empty vehicle or container. By subtracting it from the gross weight (laden weight), the weight of the goods carried (the net weight) may be determined.
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
A tax assessed by a government on goods entering or leaving a country. The term is also used in transportation in reference to the fees and rules applied by a carrier for its services.
The breakdown of the work in an activity into smaller elements.
Task Interleaving:
A method of combining warehouse picking and putaway. Warehouse Management Systems (WMS) use logic to direct (typically with an RF terminal) a lift truck operator to put away a pallet en route to the next pick. The idea is to reduce “deadheading” or driving empty material handling equipment around the warehouse.
The practice and science of classification. Taxonomy may represent a particular classification arranged in a hierarchical structure.
T’s & C’s:
See: Terms and Conditions
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 (of material handling):
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, which serve as a starting point to identifying potential problems and assessing need, are:1. Planning2. Standardization3. Work4. Ergonomic5. Unit Load6. Space Utilization7. System8. Automation9. Environment10. Life Cycle Cost
The document which a business transaction to be performed.
Tenets of 5S:
See: 5S Program
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 (T’s & C’s):
All the provisions and agreements of a contract.
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 (TOC):
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 (3PL):
Outsourcing all or much of a company’s logistics operations to a specialized company. The term "3PL" was first used in the early 1970s to identify intermodal marketing companies (IMCs) in transportation contracts. Up to that point, contracts for transportation had featured only two parties, the shipper and the carrier. When IMCs entered the picture—as intermediaries that accepted shipments from the shippers and tendered them to the rail carriers—they became the third party to the contract, the 3PL. But over the years, that definition has broadened to the point where these days, every company that offers some kind of logistics service for hire calls itself a 3PL. Preferably, these services are integrated, or “bundled,” together by the provider. Among the services which they provide are transportation, warehousing, cross-docking, inventory management, packaging, and freight forwarding. In 2008 the US Congress passed legislation declaring that the legal definition of a 3PL is “A person who solely receives, holds, or otherwise transports a consumer product in the ordinary course of business but who does not take title to the product.”
Third Party Logistics Provider:
A firm which provides multiple logistics services for use by customers. Preferably, these services are integrated, or "bundled" together by the provider. These firms facilitate the movement of parts and materials from suppliers to manufacturers, and finished products from manufacturers to distributors and retailers. Among the services which they provide are transportation, warehousing, cross-docking, inventory management, packaging, and freight forwarding.
Third Party Service Provider (3PSP):
See: Third Party Logistics (3PL)
Third-Party Warehousing:
The act of using a contractor to provide warehousing services, and the name of the industry which is involved in providing contract warehousing operations for hire.
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.
A measure of volume through a process such as warehousing output volume (weight, number of units). Also, the total amount of units received plus the total amount of units shipped, divided by two.
Time Based Order System:
See: Fixed Reorder Cycle Inventory Model
Time Bucket:
A defined period, typically 7 days, wherein data is summarized for presentation in an MRP system. Data in the bucket is usually divided into groups showing inventory beginning balance, anticipated supply and demand, and available ending balance.
Time Fence:
A specific reference date used as a boundary for policy changes in a planning or other system. A policy that seeks to stabilize the master production schedule may prohibit changes to the existing schedule inside the time fence (which is based on lead time) and allow changes under certain circumstances after that date. Another example is the reaction to demand based on customer orders only inside the lead time fence, and based on forecast thereafter.
Time-Definite Services:
Delivery is guaranteed on a specific day or at a certain time of the day.
Time/Service Rate:
A rail rate that is based upon transit time.
The time interval between product concept development and introduction to the marketplace. It includes specification development, product development and release to production.
Time Utility:
A value created in a product by having the product available at the time desired. Transportation and warehousing create time utility.
Time schedules of departures and arrivals by origin and destination; typically used for passenger transportation by air, bus, and rail.
See: Truckload Carrier
See: Transportation Management System.
See: Theory of Constraints
See: Trailer-on-Flat Car, Piggyback
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:
A curve that graphically represents the relation between the total cost incurred by a firm in the short-run production of a good or service and the quantity produced. The total cost curve is a cornerstone upon which the analysis of short-run production is built. It combines all opportunity cost of production into a single curve, which can then be used with the total revenue curve to determine profit.
Total Cost of Acquisition:
See: Acquisition Cost
Total Cost of Ownership (TCO):
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 Cost of Quality:
A measure that sums all costs associated with poor quality or product failure, including rework, scrap, warranty costs and other costs incurred in preventing or resolving quality problems. Costs associated with maintenance and quality training are not included.
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 # of units in WIP] / [Average daily output in units] – WIP days of supply
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 Landed Costs:
Usually referred to as the total cost of a landed shipment, it includes purchase price, freight, insurance, and other costs up to the port of destination. In some instances, it may also include the customs duties and other taxes levied on the shipment.
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 # of units in active manufacturing] / [Average daily output in units]
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 # of units in packaging and labeling WIP] / [Average daily output in units]
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. Recognizes 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 (TPM):
Team based maintenance process designed to maximize machine availability and performance and product quality.
Total Quality Management (TQM):
A management approach in which managers constantly communicate with organizational stakeholders to emphasize the importance of continuous quality improvement.
Total Sourcing Lead Time (95% of Raw Material Dollar Value):
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 Management Cost (5 elements):
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 actual 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 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 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 # of units in test and release] / [Average daily output in units]
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.
The number of times a labor action is taken during a manufacturing or assembly process. Touches are typically used to measure efficiency or for costing and pricing purposes
See: Total Productive Maintenance
See: Total Quality Management
Determining where a shipment is during the course of a move.
  1. The ability to track the location of a shipment as it moves through the shipping process to the customer.
  2. The ability to determine the source of individual lot numbered or serial numbered products.
  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:
A statistic that reveals instances where parameter estimates in a forecasting model are not optimal. For example, a tracking signal might be based on a graph of the ratio of the cumulative sum of the differences between the actual and forecast values to the mean absolute deviation. If the tracking signal exceeds a certain value, the series can then be flagged for examination. This concept has been used successfully in quality control. It seems sensible also for forecasting, although little research supports its use. An alternative is to use successive re-estimation.
The tractor is the driver compartment and engine of the truck. It has two or three axles.
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.
A department responsible for the process of determining timely and economic delivery methods, arranging internal or external transportation, and tracking shipment status and logistics network issues.
Traffic Management:
The management and controlling of transportation modes, carriers and services.
The part of the truck that carries the goods.Trailer Drops: When a driver drops off a full truck at a warehouse and picks up an empty one
Trailer on a Flatcar (TOFC):
Transport of truck trailers with their loads on specially designed rail cars. Synonym: Piggyback.
Training Plan:
An outline of the training process an instructor will use in a training program.
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.
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:
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 between a shipment's pickup and delivery.
Translation Software:
Software the converts or "translates" business application data into EDI standard formats, and vice versa.
Transload Facility:
A Facility used for transferring shipments from truck to rail and vice versa. Operations where inbound ocean containers (or other cargo) are unloaded, palletized and then reloaded (typically into 53-foot over-the-road trailers), for railway or road transport to a final destination.
Transmission Acknowledgment:
Acknowledgment that a total transmission was received with no errors detected
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. Also see: Visibility
Transportation Association of America:
An association that represents the entire U.S. Transportation system, carriers, users, and the public; now defunct.
Transportation Cycle Time:
A performance measure of the Logistics service provider / transporter. The lead time taken by the product to reach the final destination, The difference between the day it leaves the warehouse and the day it reaches its destination
Transportation Management System (TMS):
A computer system designed to provide optimized transportation management in various modes along with associated activities, including managing shipping units, labor planning and building, ship­ment scheduling through inbound, out­bound, intra-company shipments, docu­mentation management (especially when international shipping is involved), and third party logistics management.
Transportation Mode:
The method of transportation: land, sea, or air shipment.
Transportation Planning:
The process of defining an integrated supply chain transportation plan and maintaining the information which characterizes total supply chain transportation requirements, and the management of transporters both inter and intra company.
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 Planning (TRP):
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 Security Administration (TSA):
TSA was created in response to the attacks of September 11th and signed into law in November 2001. TSA was originally in the Department of Transportation but was moved to the Department of Homeland Security in March 2003. TSA's mission is to protect the nation’s transportation systems by ensuring the freedom of movement for people and commerce.
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.
Transportation Association of America:
An association that represents the entire U.S. transportation system—carriers, users, and the public; now defunct.
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 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.
Refers to a factor used in forecasting where there is general upward or downward movement of a variable over time such as demand for a product.
Trend Forecasting Models:
Methods for forecasting sales data when analysis of data exhibits an ongoing upward or downward pattern that is not due to seasonality or random noise.
Tribal Knowledge:
A person's in-depth knowledge about a specific project or process because he or she has been working on the project or process since its inception. It can also be any unwritten information that is not commonly known by others in the department, functional area or company.
Triple Bottom Line Metrics:
Metrics that measure ecological and social performance in addition to financial performance. Triple Bottom Line is also known as People, Planet, Profit.
See: Transportation Requirements Planning
Truckload Carriers (TL):
Trucking companies, which move full truckloads of freight directly from the point of origin to destination.
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.
See: Transportation Security Administration
  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 (TEU):
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. A 20 foot container is typically 8.5 feet tall and 8 feet wide outside and has an internal capacity of 1170 square feet.
Two-Level Master Schedule:
An approach to master scheduling in an environment that uses product family plans with a variety of options at the end item level. The first level creates a master schedule at the family level for general planning purposes. The second level uses customer specific option choices to provide improved master schedules at the option level. Also see: Production Forecast
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-way Scorecards:
A scorecard that allows a supplier to provide feedback on how well a buyer is providing it with information, paying on time, and managing other key elements of bilateral performance.