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Operations Management Terms (G-N)


Gantt Charts – A chart in which a series of horizontal lines shows the amount of work done or production completed in a certain period of time in relation to the amount planned for those period.

Graphic linear programming – Provides a quick insight into the nature of linear programming.

Group Technology (Cellular) Layout – Groups dissimilar machines into work centers (or cells) to work on products that have similar shapes and processing requirements.


High and Low Degree of Customer Contact – The physical presence of the customer in the system and the percentage of time the customer must be in the system relative to the total time it takes to perform the service.

House of Quality – A matrix that help’s product design team translate customer requirement into operating and engineering goals.

Hybrid Process – Combines the features of both make-to-order and make-to-stock.


Independent Demand – Demand that cannot be directly derived from the demand for other products.

Individual Learning – Improvement that results when people repeat a process and gain skill or efficiency from their own experience.

Infinite Loading – Work is assigned to work center based on what is needed over time.

Intermediate-Range Planning – Activity that usually covers a period from 3 to 18 months with weekly, monthly, or quarterly time increments.

Innovative Products – Products such as fashionable clothes and personal computers that typically have a life cycle of just a few months.

Inventory – The Stock of any item or resource used in an organization.

Inventory Position – The amount on-hand plus on-order minus backordered quantities.

Inventory On Hand – Unused inventory carried from a previous period.

Inventory Turnover and Weeks of Supply — Measures of supply chain efficiency that are mathematically the inverse of one another.

ISO 9000 – Formal standards used for quality certification, developed by the International Organization for Standardization.


Job Design – The function of specifying the work activities of an individual or group in an organizational setting.

Job Enrichment – Specialized work is made more interesting by giving the worker a greater variety of tasks or by getting a worker involved in planning, organization and inspection.

Job Shop – A process structure suited for low- volume production of a great variety of nonstandard products.

Johnson’s Rule – A sequencing rule used for scheduling any number of jobs on two machines.

Just in Time (JIT) – A highly coordinated processing system in which goods move through the system and services are performed, just as they are needed.


Kanban and the Kanban Pull System – An inventory or production control system that uses a signaling device to regulate flows.


Labor Limited Process – People are the key resource that is scheduled.

Late Start Schedule – A project Schedule that lists all activities by their late start time.

Learning Curve – A line displaying the relationship between unit production time and the cumulative number of units produced.

Level Schedule – A schedule that pulls material into final assembly at a constant rate.

Linear programming – Refers to several related mathematical techniques use to allocate limited resources among competing demands in an optimal way.

Linear Regression Forecasting — A forecasting technique that assumes that past data and future projections fall around a straight line.

Lean Production – Integrated activities designed to achieve high-volume, high-quality production using minimal inventories of raw materials, work-in-process and finished goods.

Little’s Law – States a mathematical relationship between throughput rate, throughput time and amount of work.

Lot – A quantity of items that are processed together.

Long-Range Planning – Activity typically done annually and focusing on a horizon of a year or more.


Mass Customization — The ability of a company to deliver highly customized products and services to different customers around the world.

Make-to-order – A process that is activated only in response to an actual order.

Make-to-stock – a process that produces standard products that are stored in finished good inventory.

Manufacturing Resource Planning – An expanded version of MPR that integrates finance, accounting, accounts payable, and other business processes into the production scheduling and inventory control functions that are part of a basis MRP system.

Material Requirement Planning – A procedure that generates specific schedules for component parts and subassemblies.

Master Production Schedule – A schedule of the amount and times when specific items will be manufactured, typically using weekly increments of time.

Matrix Project – A structure that blends the functional and pure project structure.

Mean Absolute Deviation (MAD) – The average forecast error using absolute values of the error of each past forecast.

Mixed Strategy – A plan that combines option available for meeting demand.

Machine Limited Process – Equipment is the critical resource that is scheduled.


Non-bottleneck – Any resource whose capacity is greater than the demand placed on it.

Net Change System – An MPR system that calculates the impact of a change in the MRP data (the inventory status, BOM, or master schedule) immediately.

Normal Time – The time that a normal operator would be expected to take to complete a job without the consideration of allowances.

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