CSCP (WorldatWork Rewards Certifications) key terms

The percentage of orders delivered complete, on time, damage-free, and with correct documentation. It is a composite service metric that multiplies or jointly counts each condition, so a single failure disqualifies the entire order.

The number of days between paying suppliers for inventory and collecting cash from customers. Calculated as days inventory outstanding plus days sales outstanding minus days payable outstanding, it measures how long working capital stays tied up.

A purchasing view that sums every cost incurred across a good's life, including price, freight, duties, inspection, storage, maintenance, downtime, and disposal. It reveals that a low unit price can still produce the highest overall cost.

A performance framework that tracks objectives across financial, customer, internal process, and learning perspectives. Supply chain scorecards typically add a sustainability lens and cascade targets from corporate strategy to operational teams.

A capability that customers value, is difficult for competitors to imitate, and can be extended to multiple products or markets. Strategy work uses it to decide which activities to keep in-house and which to outsource.

Delaying final product configuration, labeling, or packaging until customer demand is known. It lets a firm hold generic inventory longer, reducing forecast risk while still offering variety with short lead times.

The progressive amplification of demand variability as orders move upstream from retailer to wholesaler to manufacturer to supplier. Causes include batch ordering, price promotions, rationing games, and long lead times with poor information sharing.

A recurring cross-functional process where sales, marketing, operations, and finance agree on one demand plan and one supply plan, reconcile gaps, and commit to a single operating plan for the coming horizon.

Extra inventory held to buffer against forecast error and lead-time variability. It rises with target service level and variability, and falls when lead times shorten or demand becomes more predictable.

The inventory position at which a replenishment order is triggered. It equals expected demand during the lead time plus safety stock, so ordering at this level should cover demand until the next delivery arrives.

The order size that minimizes the sum of ordering cost and holding cost. It increases with demand and ordering cost, and decreases with holding cost per unit, ignoring quantity discounts and variability.

Using near-real-time downstream signals such as point-of-sale data, warehouse withdrawals, or retailer inventory to detect demand shifts before they appear in formal orders. It shortens reaction time in volatile markets.

A single demand plan built by reconciling statistical forecasts with input from sales, marketing, and finance. It replaces competing departmental numbers so that supply, budget, and capacity are planned against one set of assumptions.

The analysis of whether to produce a good or service internally or purchase it from an external provider. It weighs total cost, capacity, quality capability, intellectual property risk, and strategic importance of the activity.

A structured process of analyzing spend, segmenting suppliers, evaluating total cost, negotiating, and managing contracts to align the supply base with long-term business needs rather than reacting to individual requisitions.

Grouping suppliers by criteria such as spend, risk, and strategic importance to apply differentiated management. A common model separates strategic, leverage, bottleneck, and routine categories, each needing a distinct sourcing approach.

The full cost of a purchased item once it reaches the buyer's door, including unit price, freight, insurance, duties, tariffs, brokerage, and handling. It is the correct basis for comparing suppliers across countries.

Standard international trade rules published by the International Chamber of Commerce that define which party arranges and pays for freight, insurance, export clearance, and import clearance at each stage of a shipment.

A structured list of all components, subassemblies, and quantities required to build one unit of a finished product. It drives material requirements planning, costing, and engineering change control.

A time-phased plan stating which end items will be produced and in what quantities during each period. It disaggregates the aggregate plan and feeds material requirements planning.

A calculation that explodes the master schedule through the bill of materials, nets on-hand and scheduled receipts against gross requirements, and offsets by lead time to produce planned orders.

The process of testing whether planned orders from material requirements planning can be produced with available work-center hours. It compares load against capacity by period and highlights overloads requiring rescheduling or added capacity.

A management approach holding that throughput is limited by the system's bottleneck. Improvement focuses on identifying the constraint, exploiting it fully, subordinating other resources to it, then elevating and re-evaluating it.

A scheduling method that paces production to the bottleneck resource, called the drum, protects it with a time buffer, and releases material only at the rate the drum can absorb, using the rope as the release signal.

A production philosophy aimed at eliminating waste in all forms while creating value from the customer's perspective. It relies on pull scheduling, small batches, standard work, and continuous improvement.

A visual signal that authorizes production or replenishment of a container of material in a pull system. Its quantity limits work-in-process and makes demand visible directly to the supplying operation.

An operating approach that delivers materials and produces goods only as needed, in the right quantity and quality. It reduces inventory and lead time but requires reliable suppliers and stable processes to avoid stockouts.

A distribution technique where inbound shipments are unloaded, sorted, and reloaded onto outbound vehicles with little or no storage. It cuts handling cost and inventory but demands tight timing and shipment visibility.

The choice of how many warehouses to operate, where to locate them, and which customers each serves. It trades facility and inventory cost against delivery speed and service level.

A formal document inviting suppliers to submit detailed technical and commercial offers against stated requirements. It is used when needs are complex and solution design, not just price, must be evaluated.

A structured program for managing interactions with suppliers by tier of importance, covering performance reviews, joint improvement, contract governance, and collaborative innovation with key partners.

A periodic report rating a supplier on agreed measures such as quality, delivery, cost, responsiveness, and compliance. Scores support business reviews, award decisions, and corrective action plans.

A contract clause or document specifying measurable performance obligations, such as delivery windows or uptime, plus remedies when targets are missed. It converts service expectations into enforceable commitments.

A living log of identified risks, each rated for likelihood and impact, with an owner, mitigation plan, and review date. It turns scattered concerns into a managed portfolio tied to business continuity priorities.

Exposure created when a purchased item or service is available from only one supplier or site. Mitigation includes qualifying alternates, holding strategic stock, dual tooling, and contractual continuity obligations.

Deliberately splitting volume for the same item between two qualified suppliers. It reduces dependence on one source and creates competitive tension, at the cost of lower volume leverage and some added complexity.

Documented procedures for keeping critical operations running, or restoring them within a target time, after a disruption. It defines recovery priorities, alternate sites, communication paths, and periodic test requirements.

The process of declaring imported goods to customs authorities, paying applicable duties and taxes, and obtaining release to enter the country. Delays here can strand inventory and break delivery promises.

A transport document issued by a carrier that serves as a receipt for goods, evidence of the contract of carriage, and, when negotiable, a document of title controlling release of the shipment.